Regulations

When regulations for safety and effectiveness are written, distinctions in accountability of the self-employed producer and corporations must be taken into account. Regulations that would be too costly or burdensome for the self-employed producer should not be applied to this sector of the economy when the judgment of the consumer and the integrity of the self-employed are society’s own best protection.

Innovation has been the hallmark of America’s economic engine. Dating back to Benjamin Franklin, the notion of the common man doing uncommon things and being rewarded for it is well established in our culture. While regulations for product safety and product effectiveness are necessary for large corporations, these same regulations can be devastating to the self-employed because these types of regulations are often too expensive or too time consuming for the self-employed producer to comply with. Representatives of corporations, rather than consumers or small producers, in fact often set “government” standards. Consequently, innovation is stifled because the relative cost in time and money for most regulatory compliance is much higher for the self-employed than for large corporate enterprises. Regulations regularly drive small producers out of business, or keep producers from entering the market at all. Product safety scares are often used as an excuse and means to drive small competitors out of business through the creation of costly regulations that only large corporations can afford, even if injuries occur only through the practices of these same large corporations.

Regulatory burdens for the self-employed include, but are not limited to, mandates for processing, handling, equipment, paper trails, inspection, testing, licensing and insurance. When the self-employed and small producers go out of business because they can’t afford to comply with regulations, rather than because they offer a useless product or are a proven danger, neither the consumer nor the economy is served. Barriers to market entry are always barriers to innovation, and usually to service.

It is a nearly iron law of modern democracy that when a regulator is created, a target of influence is created, and when a target of influence is created, those in the best position to influence will throw their efforts upon that target. The self-employed and small producers are usually unorganized, and seldom have the time or resources to influence regulatory outcomes. They must abide by the law, but seldom make it.

Under the law, sole proprietors are liable for damages their products or services may cause. Corporations are liable for damages as well, but, as legal entities, it is corporations and not executives of corporations that are usually held responsible. To escape personal liability is in fact one of the primary reasons both large and small businesses incorporate.

When regulations for safety and effectiveness are written, distinctions in accountability of the self-employed producer and corporations must be taken into account. Regulations that would be too costly or burdensome for the self-employed producer should not be applied to this sector of the economy when the judgment of the consumer and the integrity of the self-employed are society’s own best protection.

The Tester–Hagan Amendment to the Food Safety Modernization Act is a powerful example of a politician, Senator Tester, stepping forward to protect small producers from unnecessary regulations, in this case small farmers with less than $500,000 in direct sales, many of whom would have been unduly burdened by FDA regulation of irrigation water. We need more politicians like Senator Tester to step up to the plate for the self-employed when the problem that needs addressing through regulation is the wrongdoing of large producers, not the small.

The right to be one’s own boss is as fundamental to American freedom as the right to privacy or free speech.