The Big Business Dilemma: What Could Happen When Government Is Gone

by Rena Steinzor

July 14, 2011

The nation’s capital is all but intolerable these days, even for those of us who have lived here for decades and are used to excessive histrionics and gross summer weather. A pall of bad, hot, wet air has settled over the place, and serves as a backdrop to the slow-motion car wreck that is the debt ceiling negotiations—in every sense a crisis of political creation. In the midst of this misery, a small spark of comic relief was provided yesterday by the spectacle of hundreds of top-level business executives, led by the Business Roundtable and the Chamber of Commerce, pleading with their Tea Party allies not to run the economy into a ditch by provoking a default on the country’s financial obligations to institutions and governments across the globe. Having hitched its political wagon to a team of wild horses, big business has gone to the whip now that right-wing irrationality has impinged on its financial interests.

In fact, for years, big business has ridden quietly along while various brands of fiercely ideological conservatives drove the political wagon for the Republican party. Happily for them, the big business agenda—corporate welfare and the decimation of regulations that would rein in financial institutions; help blue-collar workers, and protect the environmental—fit neatly into the anti-“big government” mantra of their allies. When the Tea Party emerged, it seemed like the dance would never end. Dozens of newly elected Republicans were only too happy to make regulation the whipping boy for every problem that ails the economy, if only as a distraction from the real causes of the recession, which, let’s face it, have a lot to do with Republican anti-regulatory policies. Even better, the new Republican majority scheduled dozens of hearings aimed at brow-beating dozens of Administration officials from a cross-section of federal regulatory agencies. From Elizabeth Warren at the Consumer Financial Protection Bureau, to Lisa Jackson at the Environmental Protection Agency, to David Michaels at the Occupational Health and Safety Administration, the Republicans are eager to blame the Obama Administration for the length and depth of the recession that began on the GOP’s  watch. 

The agencies’ sense of trying to survive in a bunker with 24/7 incoming fire was not helped by President Obama and the White House staff, who made a decision several months ago to try to get out in front of anti-regulatory rhetoric, thus heaving the agencies under the bus. Things are so bad at this point that a number of major regulatory initiatives, no matter how long in the pipeline, are frozen in place, waiting until after the election.  Elizabeth Warren is unlikely to ever get a permanent appointment, and implementation of financial reforms crafted in the wake of the 2008 crash has slowed to a crawl. EPA probably won’t control coal ash dumps—one of which burst three days before Christmas in 2008, flooding Kingston, Tennessee with 1 billion gallons of inky, toxic sludge—at least for the foreseeable future. OSHA is so cowed that it could not cough up a minor change in a reporting form that would have tracked ergonomic injuries of workers in such physically punishing industries as poultry processing and warehouse operation.

Here’s just one small window on the madness. A House Science Subcommittee chaired by Rep. Paul Broun (R-GA)—he’s the guy who used a July 4 picnic in his district to compare progressives like me to Al Qaeda—will hold a hearing today to try to discredit the EPA program for writing toxicological profiles for such genuinely dangerous chemicals as dioxin, formaldehyde, and arsenic. I’m scheduled to testify. The profiles establish the level of exposure that is considered dangerous for human beings, and are thus the foundation of EPA’s efforts to control hazardous chemicals. But the chemical industry, relying on its GOP champions, hopes to put in place a freeze on all funds for producing future assessments until EPA has gone back and re-done the hundreds of profiles already in the data base. We need to reassess dioxin? Formaldehyde? Arsenic? Really?

So here’s a prediction suggested by the dilemma business leaders find themselves in as time to raise the debt ceiling runs out. The slash-and-burn party they are having won’t last forever—it could even be over after next year’s elections. But the agencies themselves—especially those that watch out for public health, worker safety, and the environment—will remain walking wounded, with scant budgets, demoralized staff, and a pattern of keeping their heads down that could take years to get over. In the absence of credible regulatory controls, we’ll see more and worse disasters like the Deepwater Horizon spill, the Big Branch mine collapse, or the Texas City refinery explosion. For industries engaged in hazardous operations, including the chemical industry, a sort of Wild West mentality will sink in, as disasters mount, which will give rise to a sense of panic among business leaders not altogether unlike what they’re feeling now at the prospect of a debt default. If they gut the government, and all its essential functions, one day they’ll get what they wish for, to their long-term shock and acute distress.

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Rena Steinzor is a Professor of Law at the University of Maryland Francis King Carey School of Law, and a past president of the Center for Progressive Reform. She is the author of Why Not Jail? Industrial Catastrophes, Corporate Malfeasance, and Government Inaction.

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