Smarter Regulation
Intelligent and strategic government regulation is an important organizational element in any social economy. It must be based on clearly articulated social and economic goals derived through open discussion and debate. The debate, however, should occur upstream in the political arena and, led appropriately, has the potential to derive consensus rather than chaos. Consensus then becomes articulate law.
The problem is what follows: interpretive adjudication leading to rules and precedents that are then codified and implemented case-by-case in regulatory decision-making. This is often followed by judicial appeal and review that may then alter the original rules and precedents. Business and non-profits are left with a quicksand of expensive and unpredictable process in which they must try and make strategic investment decisions.
Add to this, the destructive polarization of current political ideologies and the fact that it surfaces so far downstream in the regulatory process and regulation becomes the shambles it is today. It tries to accommodate the far right’s desire to regulate nothing that negatively affects their own ability to accrue additional wealth and the left’s 19th century shibboleth that all business is inherently bad, and, more recently, that business and the environment are incompatible. There is an intelligent middle ground.
Whether regulating a monopoly, a competitive marketplace, for-profits or not-for-profits, regulation is little more than planning to conform agreed-upon social and economic objectives. It must, however, be driven by these objectives, not by personal ideologies.
Vermont simply cannot afford our present system of adversarial regulation. The cost in time and resources is beyond our budget and that of many of the regulated businesses or non-profits. We don’t have the money for staff research and economic modeling or the time and resources to adjudicate conflict and predict the economic outcomes of increasingly complex issues. I was asked by a Bostonian what BISHCA stood for and when I explained that it was an agency that regulated banking, insurance, securities and healthcare, she smiled and said that is a lot of people under one umbrella and then asked how we could afford it? The truth is we can’t.
Nationally, the current administration has cast the bait of tax cuts on the water and we bit. The cuts will eventually choke off funding for some of the regulation that impedes the progress of free market capitalism. Unfortunately, they will also starve many social safety net programs. Why suffer the slings and arrows of execution, when one can simply malnourish? In Vermont, regulation is malnourished by necessity, not by design.
We do have control over our own destiny, however. With thoughtful leadership, we can convene people from diverse points of view and agree on what we are trying to achieve or at least agree to disagree on certain issues and stop squabbling.
The advent of second-generation wind power technologies brings us the opportunity to try something different in regulation. Why not think strategically and bring together advocates from all sides of the issue and seek common ground about the risks and opportunities inherent in wind power generation and scale. From this consensus, a clear regulatory pilot could be fashioned under which individual, commercial and non-profit entrepreneurs might proceed under clear guidelines. The advantage would simply be clarity on all sides. With clarity, one can invest in technology rather than compliance. After a defined period in which the “rules of the game” would be consistent, the pilot experience would be reviewed and a new regulatory framework could be structured with real data and experience. This is prospective regulation. Our current adversarial system is expensive, inhibitive, corrosive and time-consuming.
Strategic regulation is simply a higher form of management. It measures the regulated society against that society’s own goals and objectives. It partners cautiously with those it regulates to ensure their understanding of the goals and to assess their plans for both meeting their own institutional or business objectives while contributing positively to the goals and objectives of the society at large. The regulated can then be held accountable for their contribution to the larger mission of society. Regulation is really about conforming missions.
We cannot afford to regulate the way we have. We need more discussion of common goals and objectives and less ranting about why my way is the right way. We need smart people listening to one another. We have them. We need leadership to bring them together.
Bill Schubart
11:36:03 AM 
|
