When government is too much and not enough, all at the same time

If you ask most right-leaning folks what they want from government regulators, they’ll usually just tell you, “less.” If you ask most left-leaning folks, they will argue for regulators to have more power over our lives, unless it affects them personally in any sort of negative way, and then they’ll also tell you they want “less.” (I have yet to meet the small business owner of any political persuasion who wants more legal red tape.)

I don’t want to chill this undercurrent of bipartisan agreement, but the “more/less” debate on government regulation is too often wrongly framed. It’s not a two-dimensional lever like a volume controller where it’s relatively easy to find the Goldilocks zone by tweaking the total number of regs to just the right amount. It’s about who is holding the levers, the quality of the regulations, their purpose (real and putative, which occasionally are the same) and their execution. 

Take the marijuana industry, where I have often argued there should be less regulation. There should be a net reduction in the number of rules regarding pot sales and cultivation, of course, but the really offensive thing about marijuana licensing is how arbitrary and capricious it is allowed to be. When requirements are cost-prohibitive to most start-ups and qualified applicants can be denied because “better” applicants have more personal or political connections, the goal of those laws is nothing more than to act as a protectionist racket. In other words, it’s not the fact that pot is regulated, it is the way the regulations are written and enforced that makes corruption so inviting — and breeds so much well-justified suspicion into the levelness of the playing field.

Ultimately, the more heavy-handed regulators get in any industry, the more likely that industry will corrupt itself by co-opting the regulators. And those without the right connections will take their businesses underground, won’t do business at all or will find some other workaround. And those workarounds can be even worse than the over-regulation was.

In Storey County, for instance, the fear of over-burdensome utility regulations led developers to side-step and form a public water district. This allowed the Tahoe-Reno Industrial Center to blossom quickly, diversifying the small county’s economy during some rough economic times. But the private entities and individuals running the water district are so entwined with the developers themselves that it is impossible not to raise one’s eyebrows at the potential conflicts of interest there. And whether or not everything in Storey County is strictly above-board, the opportunities, such a melding of private and public interests create for graft and corruption, are endless. 

It’s the same problem as the marijuana over-regulation, but arrived at from the other direction. At least the county is finally taking some steps to clean up this tangled web. (Storey County is uniquely susceptible to problems like this just because it’s so small. One wonders if it might not be worth thinking about re-drawing some of our county boundaries, but that’s a column for a different day…)

The regulation of any private industry should be as minimal as possible, but not less than that. Any regulations should be narrowly tailored to serve an identifiable and significant public interest, such as safety or the ability to correctly and fairly assess a tax burden. 

If and when regulators are needed, they should be full-time workers (or paid that way) to prevent the dual loyalty problem that can weaken faith in our government with even the appearance of impropriety. 

From distributing alcohol to selling cars to permitting taxi cabs to keeping the alleged riff-raff out of gaming, Nevada gets this wrong time and again. I’d say we need to restore a better balance, but I don’t think as a state we’ve ever had it right. That balance should be the goal of every lawmaker, every legislative session.

Orrin Johnson has been writing and commenting on Nevada and national politics since 2007. He started with an independent blog, First Principles, and was a regular columnist for the Reno Gazette-Journal from 2015-2016. By day, he is a criminal defense attorney in Reno. Follow him on Twitter @orrinjohnson, or contact him at orrin@orrinjohnson.com.