Tooth and Claw versus Law

By Thackray, John | Management Today, May 1989 | Go to article overview

Tooth and Claw versus Law


Thackray, John, Management Today


TOOTH AND CLAW VERSUS LAW In politics perceived realities and half truths often triumph over the facts. Which is why Ronald Reagan quit the White House to a media fanfare that he'd got Big Government to stop interfering with the rights and freedoms of business, and essentially unravelled the New Deal. But most deregulatory gains were the result of executive, fiat, and/or indifference to law enforcement by Reagan's regulatory appointees. Rarely did he try to stimulate legislative support for his deregulatory ideology. Which is perhaps why half-way through his second term Congress began to manifest backlash symptoms. In 1986 Representative Chalmers Wylie of Ohio, senior Republican on the House Banking Committee, said: 'The mood of Congress is not to push for deregulation. In fact, the growing perception here is that deregulation caused many of the problems. The pressure at this stage is to regulate.'

The ensuing two years saw the fires die down further on deregulation; which Reagan partly recognised by appointing fewer deregulatory hardliners and fait neants to key agencies. The successors to the likes of William Isaac of the Federal Deposit Insurance Commission and C. Todd Conover, Comptroller of the Currency, or William Miller at the Federal Trade Commission, Mark Fowler at the Federal Communications Commission (FCC), James Watt at Interior and Rita Lavelle at the Environmental Protection Agency, were less hostile to their regulatory missions; much of this regulation is beneficial to business in any case. But when Congress then took the re-regulatory initiative, Reagan seemed to remember the simple maxims of his prompt cards. Last year, for instance, both houses passed, with huge majorities, laws to reintroduce curbs on advertising during children's TV shows -- regulations that FCC chairman Mark Fowler unilaterally demolished in 1984. This victory, declared the bill's sponsor, Representative Edward J. Markey, a Massachusetts Democrat, 'signals an end to the deregulatory excesses of the Reagan era'. However, Markey was a little premature. Just as he was leaving Reagan vetoed the bill -- on the grounds that it violated advertisers' freedom of speech.

So much for background to the issues that Bush must contend with on the regulatory scene. Although he headed Reagan's deregulatory task force, he has the ill-luck to come to power when a host of regulated industries are irritating the commonweal: like airlines (deregulated under Carter), the bankrupt savings and loan associations, telecommunications, Wall Street and toxic wastes. 'There is nobody who has not suffered from airline deregulation. You can see that it doesn't work. Only the intractable right sees no wrong in Eastern's confrontational chairman Frank Lorenzo,' notes Kathryn Morrison of the Washington office of the Conference Board, a business research organisation. Moreover, there are an increasing number of right-wing Congressmen now urging selective re-regulation. These include New York Senator Alfonse D'Amato, who is fighting hard for appropriations for the Consumer Product Safety Commission, which was gutted under Reagan.

Reagan's popularity permitted him certain immunities from pressure; his anti-environmentalism, for example, flew right in the face of all public opinion. …

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