Fred DeLuca, founder and president of the Subway sandwich chain, doubts he would have made it in today’s business environment [Washington Free Beacon]:
It’s continuously gotten worse, because there’s more and more regulations. It’s tougher for people to get into business. Especially a small business. I tell you, if I started Subway today, Subway would not exist, because I had an easy time of it in the ’60s when I started. I just see a continuous increase in regulation.
What Paul Krugman likes about the unprecedented structure of the Consumer Finance Protection Bureau is what fans of constitutional government should dislike about it, writes Ira Stoll [SmarterTimes].
Who if anyone should be entrusted with the job? [NewTalk symposium with Stuart Taylor, Jr., James Maxeiner, Ron Faucheux. E. Donald Elliott, Mary Kiffmeyer]
P.S. Or how about a Regulatory Reduction Commission? [Wayne Crews and Ryan Young, Washington Times]
Kerri Smith came up with a new design for a maternity support pillow and decided to sell it online. Then came the unpleasant surprise: 15 states require “law tags” on pillows and each charges its own fee, ranging from $5 to $720 a year. First year cost of complying with those state laws in order to start taking orders from anywhere in the country: $4,660. And that’s before more states join the 15 that currently exact fees. [Becket Adams, The Blaze/WTAM] As for a pillow intended for the actual baby, don’t even ask.
The uproar continues, and quite properly so (earlier here and here), over the threats of Boston Mayor Thomas Menino and Chicago alderman Proco (“Joe”) Moreno to exclude the Chick-Fil-A fast-food chain because they disagree (as do I) with some of the views of its owner. Among the latest commentary, the impeccably liberal Boston Globe has sided with the company in an editorial (“which part of the First Amendment does Menino not understand?…A city in which business owners must pass a political litmus test is the antithesis of what the Freedom Trail represents”), as has my libertarian colleague Tom Palmer at Cato (“Mayor Menino is no friend of human rights.”)
The spectacle of a national business being threatened with denial of local licenses because of its views on a national controversy is bad enough. But “don’t offend well-organized groups” is only Rule #2 for a business that regularly needs licenses, approvals and permissions. Rule #1 is “don’t criticize the officials in charge of granting the permissions.” Can you imagine if Mr. Dan Cathy had been quoted in an interview as saying “Boston has a mediocre if not incompetent Mayor, and the Chicago Board of Aldermen is an ethics scandal in continuous session.” How long do you think it would take for his construction permits to get approved then?
Thus it is that relatively few businesses are willing to criticize the agencies that regulate them in any outspoken way (see, e.g.: FDA and pharmaceutical industry, the), or to side with pro-business groups that seriously antagonize many wielders of political power (see, e.g., the recent exodus of corporate members from the American Legislative Exchange Council).
A few weeks ago I noted the case of Maryland’s South Mountain Creamery, which contends through an attorney (though the U.S. Attorney for Maryland denies it) that it was offered less favorable terms in a plea deal because it had talked to the press in statements that wound up garnering bad publicity for the prosecutors. After that item, reader Robert V. wrote in as follows:
Your recent article about the [U.S. Attorney for Maryland] going after the dairy farmers reminded me a case in New York state where the Health Department closed down a nursing home in Rochester. They claim is was because of poor care, the owner claims it was because he spoke out against the DOH.
The state just lost a lawsuit where the jury found the DOH targeted the nursing home operator because he spoke out against them.
According to Democrat and Chronicle reporters Gary Craig and Steve Orr, the jury found state health officials had engaged in a “vendetta” against the nursing home owner:
Beechwood attorneys maintained that an email and document trail showed that Department of Health officials singled out Chambery for retribution because he had sparred with them in the past over regulatory issues. The lawsuit hinged on a Constitutional argument — namely that the state violated Chambery’s First Amendment rights by targeting him for his challenges to their operation.
The Second Circuit panel opinion in 2006 permitting Chambery/ Beechwood’s retaliation claim to go forward is here. It took an extremely long time for the nursing home operators to get their case to a jury; the state closed them down in 1999 and the facility was sold at public auction in 2002.
A year ago the D.C. Circuit told the Transportation Security Administration (TSA) that it needed to go through notice-and-comment rulemaking for its controversial program of full-body scanners at airports. The rulemaking process is intended to ensure that the agency lays out clearly the factual, legal and policy basis for its actions, with a chance for opponents to lodge objections and establish a basis for judicial review. As my colleague Jim Harper points out, the agency has dragged its heels about doing this — a sort of passive resistance it would probably not tolerate from the hapless citizens stuck in its lines. TSA screening is one of the most widely resented governmental intrusions on the individual citizen of our era. Shouldn’t we all demand that the federal government demonstrate adequate justification for imposing it? [Cato at Liberty and Ars Technica; Consumerist; Constitutional Law Prof, 2011] (& welcome National Review “Web Briefing” readers; John LaPlante, Detroit News “Water Cooler”)