In this chaotic campaign season, if you are looking for political optimism, look no further than the Supreme Court’s recent 6-3 decision to overturn the Chevron doctrine. It may be one of the most consequential economic reforms of the millennia. Oddly, the most significant victors are portrayed as the biggest victims. Let’s correct the record.
The Chevron doctrine is Supreme Court precedent based on a 1984 decision in Chevron v. Natural Resources Defense Council, which ruled that in litigation involving regulations enacted by the executive branch, the courts should defer to the federal agencies’ interpretation. There is no need for those pesky judges to arbitrate independently when disputes arise!
The ruling undermined the principle of checks and balances in the Constitution. Our system is designed for power to be shared among the three branches of government, not for unelected bureaucrats to write ever-changing rules with no oversight. Chevron’s deference enabled federal agencies to craft overly vague rules, imposing significant costs on the economy without ever receiving a vote in Congress. It created a complex and unpredictable landscape for businesses, as interpretations could shift with any new administration. Regulations shouldn’t have constantly evolving meanings.
Who can thrive in this challenging regulatory terrain? Unsurprisingly, large companies are best positioned. Unlike their smaller competitors, they have the resources to handle the compliance costs from ever-shifting regulatory goalposts. It’s no secret that Big Business has used regulations to its advantage by stifling competition. Might this be why it takes 10 years for a new drug to get approved by the FDA?
In recent years, tech companies have succeeded in using FCC authority to enact price controls on broadband service under the guise of “net neutrality” — an obvious gift to themselves to ensure their operating costs don’t rise. Meanwhile, Americans are potentially on the hook for new taxes to supplant diminished private-sector investment resulting from broadband now being regulated as a public utility. Let’s hope repealing net neutrality is the first legal challenge that emerges in the post-Chevron era.
We’ve also seen attempts at regulatory capture emerge from Congress with the debate over the Kids’ Online Safety Act. Notably, Big Tech companies were divided on this legislation. The belief here is some of the largest tech players are willing to stomach more draconian regulation as a way to impede competition.
Rules and laws are often given high-sounding moral justifications to gain public support. However, regulations must be assessed for their effect on competition.
Layers upon layers of red tape inevitably stifle innovation across all parts of the economy, from technology to finance to healthcare. It’s precisely because of this stifling effect that overturning the Chevron doctrine is a game-changer for entrepreneurs willing to challenge the dominant market players in any of those industries.
Welcome to a brighter future, courtesy of the Supreme Court.
Jon Decker is a senior fellow at the Parkview Institute He wrote this for InsideSources.com.
Reprinted with permission from DC Journal – By Jon Decker
The opinions expressed by columnists are their own and do not necessarily represent the views of AMAC or AMAC Action.