Nixon
Is YIMBYism the first step towards regulatory reform?
The Intellectual Roots of YIMBYism
Only Nixon could go to China.
‘At the Democratic National Convention former President Obama came out strongly in favor of housing deregulation saying “we need to build more homes and clear away some of the outdated laws and regulations that make it harder to build homes”. Robert Kwasny asks on X, “What are the intellectual roots of present-day YIMBYism?”’
Hallelujah, a Transplant Test Reversal
Tests designed to detect early organ rejection in transplant patients survives a near-death threat of cancelation payment restrictions from CMS. Apparently, people revolted.
‘It’s one small step for a bureaucracy, one giant leap for organ-transplant patients. We’re referring to the Centers for Medicare and Medicaid Services’ (CMS) Friday announcement that it is canceling a planned restriction on a blood test that can help save lives. Count it a rare victory for best practices over the rationing instincts of the healthcare bureaucracy.
‘CMS said in a press release that the Medicare Administrative Contractors have “carefully considered all the feedback received from interested parties” since the proposed restriction was announced and “upon further review of the evidence, the MACs are not finalizing the proposed LCD [local coverage determination].”
‘Feedback is an understatement. Since the rules were changed, doctors and patients across the country have expressed dismay and panic at losing the tests that keep organ-transplant patients alive. CMS says it recognizes the “importance of identifying solid organ allograft rejection early”—that is, transplant rejection—and will issue a new draft coverage policy in the next few months.’
Lina Khan’s Noncompete Ban Goes Down in Court
The FTC can always prosecute companies who use noncompete bans to compete unfairly. However, that is expensive and does not scale. So, of course, the agency was impatient and decided to promulgate a 570-page rule, citing the “tacit permission” of Congress. And, of course, there are states like California who have already made their own laws.
Mommy didn’t say I couldn’t drive the car and she did leave the keys on the counter, so I guess she really wanted me to go driving.
Impatient regulation is bad regulation.
‘The FTC argued that Congress’s failure to forbid rule-makings against alleged “unfair methods of competition” confers tacit permission. Judge Brown shot down this reasoning: “The role of an administrative agency is to do as told by Congress, not to do what the agency thinks it should do.”’
Schumer Optimistic About Passing Federal AI Regulation This Year
Schumer seems confident of getting something “great” through the Senate before the end of the year.
Former Palantir data scientist and now Congressman suggests one approach to AI regulation, given the lack of AI expertise in Congress.
‘“To take a very old-timey reference…the standard in most states is, you’re the dynamite operator. You know how to make it safe. If you blow up a rock and it destroys someone’s house, you’re liable. We don’t care if you’re like, ‘No, I took the right precautions.’ You’re the expert. You should figure it out,” Bores said.
‘“We could think about that with AI—you’re the experts. If something goes wrong, we’re not going to come in later and say, ‘Oh, was it reasonable or not?’ You’re going to be liable,” said Bores, who has a master’s degree in computer science from Georgia Tech and has worked as a data scientist at Palantir Technologies.’
Patents, Property Rights, and Regulation
If patents are “government-granted privileges,” then the government can take them away.
Are ideas a public good in that they are non-rivalrous and non-exclusive? There is a public policy benefit to granting these privileges: increased innovation. If the patent system is nothing more than a “regulatory framework” vulnerable to “rent-seeking” and “manipulation,” then the door to patent reform is open, with the ideal objective of increasing innovation that improves general welfare, while removing the methods for distortionary behavior.
Once you open the door, will it be too tempting to just remove patent protection altogether with the partial-equilibrium assumption that innovation will continue unabated?
‘Long viewed as a cornerstone of innovation policy, the U.S. patent system is designed to encourage invention and promote technological progress. Over time, many have come to view patents as property rights akin to those arising from tangible, physical property. However, a closer examination reveals that patent rights are fundamentally different from physical property rights and that the patent system functions more as a regulatory framework that defines and grants market exclusivities. And like any regulatory structure, the patent system is subject to rent-seeking and special-interest politics.’
A System for Effective Rule Design
A common sense framework for understanding regulation is a good place for regulatory reform to start.
‘Coglianese argues that the relationship between regulators and those they regulate is fundamental to “the regulatory endeavor,” and that the design of rules must consider this relationship. Coglianese advances a framework aimed at providing clarity to both regulators and “regulatees” about rule design, and thus improving the effectiveness of regulation broadly.
‘He argues that regulation is fundamentally a relational enterprise. This is because regulation is about shaping behavior. Regulators seek to influence the behavior of those they regulate, and regulatees often seek to shape the behavior of regulators. The effectiveness of a rule, therefore, often depends on whether it is designed with the nature of this relationship in mind.’
Quantifying the monetary value of the regulatory tax.
Also, regulations can be highly regressive, apparently.
‘Under President Barack Obama, the U.S. government’s regulatory activity in areas like health care, the Internet, environment, and transportation was unprecedented. The hundreds of new regulations that resulted cost the average household roughly $26,000 over a lifetime, according to my new study for Unleash Prosperity, which uses a database of more than 5,000 federal rules. By contrast, the deregulatory focus of Obama’s successor, Donald Trump, wound up saving the average family about $11,000 in lifetime cost burdens. The regulatory pendulum swung back, though, with Joe Biden’s administration. To some extent, this was to be expected, as Democrats are more inclined to regulatory mandates than Republicans. But who would have expected the Biden administration to regulate with such a vengeance? I calculate a lifetime per family burden of $47,000 from Biden’s new regulations.
‘The Biden regulations are also highly regressive, with low-income households bearing a large cost as a share of their income. The poor pay seven times more when adjusting for their ability to pay.’
US Chips Act scale bigger than China Big Fund II, but manufacturing reshoring remains slow
Oh.
‘Despite US$52.7 billion from the CHIPS Act, US chip production may only increase by 1% in 2025’