Oiling The Regulatory Machine

As if the Gulf oil spill wasn’t bad enough, we now learn that the EPA is thwarting the cleanup activity. I’m sure political pundits have already started questioning the motives and competence of the Obama administration, or at least the EPA. I have no special insight into that. But I do know that large complex bureaucracies tend to be rigid and inflexible, often do stupid things, and often work against their own goals. That’s the nature of the beast, a variation of Hayek’s “distributed knowledge” problem. That’s why we see such wasteful activity as one unit of government taking another another unit of government to court, all paid for with taxpayer dollars.

I understand the desire for a regulatory technocracy to address common problems such as pollution. But there are limits on what such an approach can accomplish. When we try to push past these limits, we make matters worse rather than better. We can’t achieve Woodrow Wilson’s dream.

I’m no organizational theorist, but it seems to me that the regulatory activity we need should be pushed down and distributed. The federal role should be decreased and the state (or even county) role increased. Centralized planning, command, and control simply doesn’t work very well (except for the military – but that’s another story).

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