Niello, a small businessman, past customer and a Republican assemblyman, presents a telling editorial in the Sacramento Bee today, Saturday, October 3, 2009. He writes about the conclusions of a Sacramento State study, headed by Sanjay Varshney, dean of the College of Business Administration, regarding the over-regulation of California businesses. The conclusion of the study $492.99 billion in lost economic output due to over regulation in California. That's five times the general fund budget and a third of the state's gross product. The impetus driving the over-regulation: "Crack down on corporate greed".
Some other pertinent facts in the article:
- 99.2 % of employer businesses are small businesses. Small business is defines as independently owned and operated, not dominant in its field of operation and has annual receipts not in excess of $500,000.00 and has fewer than 500 employees.
- It is small business that is bearing the regulatory brunt of the "Big Business" crusade.
- Even more regulations are headed small businesses way, like the recently enacted AB 32 carbon tax regulations.
- The intent of the regulations center on protecting consumers, workers and the environment: In efforts to protect labor, California is loosing 3.8 million jobs a year; Labor laws severely restrict the flexibility of the work week for all classifications of workers, not just the field workers and other labor groups they seek to protect.
- The Americans with Disability Act laws, well intended but too often used as the basis of law suits to cripple or terminate small businesses.
- Big business have the resources to adapt and stay one step ahead of the regulators. Small business do not and limit expansion, limit salaries, limit benefits to cope with the regulations.
Niello's recommendations for change:
- Support proposed legislation like Senate bill 356 that "would simply ask small business how proposed regulations would affect them".
- Provide a "sunset clause" in any new regulations that would allow the consideration of a cost-benefit balance of a particular protection.
- Set up a commission to oversee regulatory authorities.
- Remove the "bounty hunting" aspect from regulatory authorities by redirecting fines to the general fund and not to the agency in charge of levying the fines.
Niello's conclusion: "What's good for Small Business is good for California" so the legislative and regulatory authorities should start acting with this in mind.
My hat's off to Roger Niello but for the sake of brevity, I will provide my own views about this subject in another post.
Charles E. Cassani
