War on regulation is trickle-down economics
BERKELEY — When Donald Trump isn’t blaming foreigners for everything that ails America, he’s blaming regulations.
Last week he even blamed regulations for the wildfires now ravaging California. They’re “made so much worse,” he tweeted, “by the bad environmental laws which aren’t allowing massive amounts of readily available water to be properly utilized.”
I have news for Trump. California’s tough environmental laws are among America’s (and the world’s) last bulwarks against climate change. And it’s climate change, not regulation, that’s wreaking havoc across California as well as much of the rest of the world.
Oh, and Californians are using water very carefully.
Yet Trump is pushing in the opposite direction. He’s now proposing to let cars pollute more and to strip California of its right to set higher air-quality rules.
Trump is also gutting other regulations that protect consumers, workers, investors, students and children.
The Trump regime is now contemplating a loophole through which companies can apply to use asbestos — a known carcinogen banned by most developed countries — in making adhesives, roofing material, floor tile and other products.
What’s the justification for all of this? “The Administration’s agenda of deregulation is unleashing the … true potential of American businesses,” trumpets Trump’s Council of Economic Advisers in its 2018 economic report.
Translated: Cutting regulations means more corporate profits. More profits satisfies Trump’s donor class.
Don’t get me wrong. Some regulations should be eliminated because they’re just too costly relative to the protections they provide. But many regulations protect you and me from being harmed, fleeced, shafted, injured or sickened by corporate products and services. And they’re worth it.
Yet Trump is taking a meat axe to all regulations. In so doing he’s creating a new form of trickle-down economics — where the benefits go to corporate executives and major investors, while the costs and risks land on the rest of us.
Trump’s Education Department under Betsy DeVos intends to repeal a regulation limiting the amount of debt that students attending career programs at for-profit colleges can pile up. It has already stopped investigating for-profit colleges.
These moves will result in more profits for the for-profits. But they will leave many young people and their parents more vulnerable to fraud.
After heavy lobbying by the chemical industry, Trump’s EPA is scaling back the way the government decides whether some of the most dangerous chemicals on the market pose health and safety risks.
This may increase the profits of the chemical industry. But it will leave the rest of us less protected from toxins that can make their way into dry-cleaning solvents, paint strippers, shampoos and cosmetics.
Trump’s Labor Department is reducing the number of workers who are eligible for overtime pay. And it’s proposing to allow teenagers to work long hours in dangerous jobs that child labor laws used to protect them from.
Again, more profits for business. But more cost and risk for the rest of us.
Trump is weakening banking regulations put in place after the financial crisis of 2008, even rolling back the so-called Volcker Rule that prevented banks from gambling with commercial deposits.
The result: More profits for the banks, more risk for you and me.
It would be one thing if corporations were plowing all these extra profits into higher pay for average workers. Maybe that would help make up for some of the extra costs and risks borne by average Americans.
But they’re not. They’re using most of the profits to buy back their own shares of stock — thereby boosting share prices.
That’s good for the richest 1 percent of Americans, who own 40 percent of the stock market, and the top 10 percent, who own 80 percent of the market. But, like trickle-down tax cuts, this does nothing for most Americans.
Trump’s gang of industry lobbyists and executives who are busy deregulating the same industries they once represented will no doubt do very well when they head back into the private sector.
The rest of us won’t do well. We may not know for years the extent to which we’re unprotected — until the next financial collapse, next public health crisis, next surge in fraud, or next floods or droughts because the EPA failed to do what it could to slow and reverse climate change.
Make no mistake: Trump’s attack on regulation is just another form of trickle-down economics — where the gains go the top, and the risks and losses trickle down.
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Robert Reich’s latest book is “The Common Good,” and his newest documentary is “Saving Capitalism.”