Don’t Be Duped by Corporate Spin: Regulation Protects Us All

High regulatory standards protect the air we breathe, the water we drink and the food we eat. They safeguard our homes, workplaces, wallets, health, environment and economy from corporate recklessness, greed and lawbreaking.

Yet every year, regulated industries, trade associations, corporate PR firms and industry-funded lobbying groups spend billions to turn lawmakers and the media against regulation. Much of their spending is aimed at making journalists unwitting accomplices in their decades-long campaign to dismantle the US’s system of public protections. That is why it is crucial for journalists to be aware of the vast amount of misinformation spread by regulated industries aimed at distorting the debate, and for news outlets to avoid editorial choices that carry water for big corporations and harm the public.

Consider that the financial crisis of 2008 was caused by weakening and repealing regulations, leading to the Great Recession, which cost Americans up to $14 trillion, destroyed 8.7 million jobs and caused pension funds for workers to lose nearly a third of their value.

Meanwhile, weak drilling safety standards resulted in the 2010 BP oil spill in the Gulf of Mexico that killed 11 workers, cost nearly $62 billion and disrupted small businesses, working families and ecosystems all along the Gulf Coast.

About 63 million Americans — including the residents of Flint, Michigan — have been exposed to unsafe drinking water in the past 10 years.

And more recently, the absence of strong regulation for big tech companies and social media platforms such as Facebook began to endanger our privacy and allow content to be throttled by internet service providers.

Amid a wave of corporate crime and wrongdoing fueled by deregulation and weak enforcement, it has never been more important for the media to serve as the public’s watchdog and voice on regulatory issues.

Bad Coverage

It shouldn’t come as a surprise that the most biased anti-regulatory coverage of all is found in overtly right-wing media outlets like Fox News and The Washington Examiner, as well as the business press. In addition, mainstream media outlets run hostile editorials and thinly sourced, fact-free anti-regulatory screeds by conservative contributors and columnists far more often than they should. But the crux of the problem is that the anti-regulatory cheerleading creeps into the mainstream media’s straight reporting.

It’s not unusual for mainstream news outlets to print preposterous claims about the cost of regulation uncritically, or to bury criticism of the claims deep in an article. Consider this April 2016 headline in The Hill that parroted the findings of a study by a corporate-funded right-wing front group: “Study: Federal regs cost economy $4 trillion in one year.” On its face, this figure is misleading because it leaves out the staggering costs of deregulation and not regulating. Buried at the bottom of the article is a quote from Public Citizen’s Amit Narang noting that the 2008 Wall Street crash cost $14 trillion.

You might think that after the financial crisis and Great Recession, the press would show a bit of skepticism toward the push by Wall Street to dismantle the Dodd-Frank Wall Street Reform and Consumer Protection Act, which set in motion hundreds of new banking safeguards, increased oversight of US financial institutions to prevent another meltdown, and established several new financial agencies, including the US Consumer Financial Protection Bureau. But in this 1,400-word Politico story about a series of Wall Street deregulatory proposals, only four brief sentences raise even the slightest of doubts about whether it’s a good idea. What’s good for big corporations is assumed to be good for the US, and Politico used the industry’s loaded terminology without questioning it.

Sometimes the pro-corporate bias is apparent in the framing. This article in The Hill, like many similar stories, wholeheartedly embraces industry’s preferred label for a regulation protecting employees of federal contractors from wage theft, discrimination and workplace safety hazards — calling it the “blacklisting rule.” In reality, the rule would have rewarded contractors who play by the rules and treat their employees fairly — but that perspective was not represented in much of the media’s coverage.

Or consider this story on Donald Trump’s deregulatory push in The New York Times that even the Times’s own Paul Krugman singled out for condemnation:

But in the administration and across the business community, there is a perception that years of increased environmental, financial and other regulatory oversight by the Obama administration dampened investment and job creation — and that Mr. Trump’s more hands-off approach has unleashed the “animal spirits” of companies that had hoarded cash after the recession of 2008. Some businesses will essentially be able to get away with shortcuts that they could not have under a continuation of Obama-era policies. The coal industry, for instance, will not have to worry about a regulation, overturned by Congress and Mr. Trump, that would have protected streams from mining runoff.

In that piece, the Times didn’t consider the impacts of deregulation on nearby families whose kids will get sick from the toxic runoff. That’s to say, nothing about the impacts on nearby ecosystems, fish and wildlife. Those are the animal spirits that are truly at stake.

Another Times article about the effect of regulations on nonindustrial farms has a sidebar decrying the “10,400 Words to Regulate Pesticide Spraying” — as if it’s a torturous burden to ask someone in charge of spraying dangerous and potentially life-threatening chemicals to read and follow the rules in a 17-page document comparable in length to the Book of Proverbs. Word counts and page counts are no way to judge the merits of regulatory protections.

Some other examples of bad coverage: ABC News repeated Trump’s “job-killing regulations” claim without so much as a word of question or criticism. CNN apparently couldn’t help but marvel at a series of GIFs from Trump’s red-tape cutting ceremony. NPR even aired an ostensibly cute song about it, caricaturing regulations that save lives and hold corporations accountable for brazen scams as Trump’s “nemesis.”

To be fair, not all coverage of regulation is as distorted as this. But the problem is pervasive enough that many journalists covering regulatory issues need to learn the basics about the subject they are covering and question not only the terminology fed to them by industry but learn what industry is not telling them.

Covering and Framing the Debate

Deregulation usually reflects the corrupting influence of big money — and it’s as insidious as the revolving door, dark money and gerrymandering. When lawmakers block or repeal specific rules, deregulate entire industries or sabotage the rulemaking process, these actions are paybacks to corporate and billionaire donors and ideological extremists for campaign contributions and political support — and they should be covered as such. It may be cliché, but it’s true: Follow the money. That’s almost always what’s behind the escalating war on regulation.

Attacks on regulation frequently are a smokescreen for corporations with something to hide. As with the tobacco and fossil fuel industries, behind closed doors, many big businesses are fully aware of the immense damage they are inflicting on society. But instead of pursuing innovations that would minimize these harms, they protect their profits by attacking public safeguards. These acts of public deception and distraction are the real story, and they are of interest to audiences everywhere.

Faced with dwindling resources, many local media outlets have chosen to focus exclusively on local issues, but national regulatory policies have major ramifications that are of great interest to local audiences. The clearest illustration of this came in the spring of 2017, when Congress used the Congressional Review Act to repeal broadband privacy protections. The corporate press all but ignored the story until after the key vote on March 28, 2017. By the time it received widespread coverage, it was too late for the thunderous, universal and bipartisan public outrage to make any difference. It was a reminder that late coverage and lack of coverage of regulatory issues only helps those who are trying to dismantle public protections.

As with broadband privacy protections, many of the rules under threat have identifiable beneficiaries and discrete local impacts all across the country. The Clean Water Rule, for example, protects the drinking water of one in three Americans; the US Consumer Financial Protection Bureau’s forced arbitration rule would have protected anyone with a bank account, credit card or loan from financial rip-offs; net neutrality would have affected anyone with an internet connection.

Not only is there an endless supply of compelling stories about regulation for enterprising journalists to uncover and cover; journalists should strive to put a human face on stories that illustrate the benefits of regulatory protections to the public and the harms of deregulation to ordinary Americans, our environment and our economy.

False Claims

Like Chicken Little, opponents of regulation always say the sky is falling, and they’ve always been wrong. Predictions of doom and gloom in the face of new rules and higher standards never pan out. The truth is that the benefits of regulation to the public vastly outweigh the costs to industry. In fact, regulation is one of the best investments we can make, with returns that would make Fortune 500 companies jealous. The US Office of Management and Budget’s latest report showed up to $833 billion in net benefits from regulation over the past decade, with the benefits reaching up to 10 times the costs.

Both The Washington Post’s fact-checker and PolitiFact have debunked the outlandish claims conservative lawmakers and industry lobbyists routinely make about regulatory costs. These numbers, which typically reach into the trillions, are based on fake, industry-funded studies that completely omit the benefits side of the ledger, aren’t even remotely scientific and greatly exaggerate the costs to industry. When quoting lawmakers or lobbyists who use them, reporters have a journalistic responsibility to note that these figures are completely bogus, paid for by industry and in some cases, have been disavowed by the very people who came up with them.

In addition to fake studies, regulated industries often try to bamboozle reporters with misleading polls. Fair and honest polling consistently has found overwhelming bipartisan support for strong regulation and tough regulatory enforcement, whether voters are asked about regulation in general terms or questioned about specific safeguards. From holding big banks, big polluters and big tech companies accountable, to securing our health and safety, to protecting our environment, three out of four Democrats, Republicans and Independents favor tough regulation and enforcement — even after hearing arguments against it.

Blaming regulation for job losses or harming our economy is another recurring red herring. There is strong evidence refuting the claim that the cumulative impact of regulation puts a drag on our economy. But it is flatly false to describe regulations as “job killing.” When the US Bureau of Labor Statistics last collected data on the question, it found that only about 1 in 500 layoffs had anything at all to do with regulation.

What’s really going on is that corporations are blaming regulation for cost-cutting measures such as layoffs, lower wages and benefit reductions that they would have implemented anyway. Regulations are the unsung hero in US innovation. Industries have developed better products and services in response to rules they once fought, creating jobs, boosting their profits and improving their reputations in the process.

Moreover, regulation helps small businesses and startups. Many regulations aid small businesses directly, specifying when businesses are small enough to qualify for special loans, assistance programs and other targeted protections. Crucially, strong regulation can restrain, prevent and punish anti-competitive behavior from industry incumbents — keeping markets open to competition from startups. For example, many small businesses are deeply alarmed about the potential anti-competitive effects stemming from the repeal of net neutrality rules. In addition, regulation keeps the playing field more level for smaller players who are honest and responsible, and protects natural resources that small communities or entire regions of the country depend upon for their prosperity.

When griping about regulation that affects small businesses and startups, opponents frequently bring up occupational licensing, zoning rules and building codes to justify harmful changes to the federal rulemaking process and the repeal of federal rules. Whether or not their complaints have merit, these issues fall under the jurisdiction of state and municipal governments and would not be affected by regulatory process reforms at the federal level. Often, it is not clear whether those who conflate federal, state and local regulation are arguing in bad faith or genuinely don’t know any better. Either way, their arguments should be examined carefully by journalists as they consider how to cover them.

Misleading Complaints

Despite complaints about excessive “red tape” and too many rules, only a tiny fraction of the rules on the book are even contested. Most rules relate to administrative and other noncontroversial matters. For example, there are rules moving Tax Day to the next official business day in years when it falls on a weekend day, rules setting the timetables for the raising and lowering of drawbridges, and rules ensuring that trees and shrubs don’t block the runways at our airports.

It’s quite rare for industry to contest regulations that have been in place for more than a decade. Eventually, the newer, higher standards are embraced by consumers and businesses alike as the minimum essential standards. Recall that, once upon a time, the auto industry insisted that seat belt requirements would put them out of business. Today, we can’t imagine driving without seat belts.

Industry complaints about regulations being too long and complex are shockingly hypocritical. Arguments about the lengthening Federal Register and attempts to show excessive word and page counts are variations on this theme. In reality, most of the complexity in our regulatory system is the result of regulated industries insisting on it to regulators and the courts. It’s pretty rich for corporations to demand longer, more nuanced, more detailed rules full of loopholes and exceptions to boost their bottom lines, and then turn around and whine about how complicated the rules are. Ultimately, it’s the quality of the rules that matters, not the quantity or length.

A great deal of industry rhetoric is designed to foster the impression that regulation is arbitrary and capricious, but that is profoundly misleading. Agencies do not issue new regulations quickly or unilaterally. They must act pursuant to a statute passed by both chambers of Congress and signed by the president. That process — known as rulemaking — can take years or decades, even for noncontroversial rules that have industry’s full support.

Rulemaking is governed by a variety of laws and executive orders — including the Administrative Procedure Act — that require agencies to conduct exhaustive studies, perform rigorous analyses of the costs and benefits of proposed rules, seek input from the public and from regulated industries, hold review panels and coordinate with other government actors. In this process, regulated industries always get a prominent seat at the table.

Regulators know that if they act arbitrarily or capriciously, skip any of the required steps or do sloppy work, their years of hard work will get struck down in court — the last thing they want. That’s why calling regulators “unelected bureaucrats” is as insulting and offensive as calling serious journalism “fake news.” Regulators are scientists or technical experts tasked with making nonpolitical policy recommendations based on provable facts and evidence. They are professional public servants and subject to significant oversight by Congress, the courts and inspectors general. Just like serious journalists, regulators deserve respect.

Big Corporations vs. “We the People”

While the mainstream media are not assailants in the war on regulation, regulated industries are spending billions every year in an attempt to turn otherwise well-meaning reporters into unwitting cheerleaders for deregulation. That’s why it’s crucial for journalists to be wary of false claims and misinformation from regulated industries and their well-heeled lobbyists — and to proactively avoid lending them unearned credibility.

Americans from all walks of life want tough regulation and enforcement to stop big banks, big polluters and big tech companies from endangering our economy, our environment and our democracy. Instead of spreading false corporate narratives, media should strive to be champions of the people and the regulatory safeguards that protect us all.