Washington has, as we’ve noted, a “mixed reputation” for regulation. In our foundation report, we acknowledge some business concern with the state’s regulatory environment.
In its latest survey of manufacturing companies, the tax and consulting rm McGladrey found that 73 percent of Washington employers cited state regulations as negatively impacting growth, higher than any other state…
In terms of regulatory content, Washington regulations routinely exceed the minimums required by federal law.
And we conclude,
While regulations ultimately re ect Washingtonians’ policy preferences, they should be regularly reviewed to see if, for example, the benefits justify the added costs of compliance.
In several areas, the discussions are gaining momentum again. For example, the editor and publisher of the Daily Sun writes a highly critical editorial challenging the state’s the new carbon regulations. We wrote about the new rules here and here.
The measure, slated to go into effect Oct. 17, will hit natural gas utilities, fuel producers and distributors, power plants and metal manufacturers the hardest. The state estimates this policy will cut emissions in our state by 1.7 percent next year…
Washington ranks 27th in the nation, with businesses putting out only 1.35 percent of the country. The U.S. ranks second in the world, putting out 14.95 percent of emissions. So, instituting a cap and trade policy here will, at best, reduce carbon emissions world wide by slightly more than 3 one-thousandths of a percent.
In last week’s Friday Roundup we linked to a Lens story on the rule, which reported,
In addition, the economic impact would be dramatic, according to the state’s largest association of employers, the Association of Washington Business (AWB).
In formal comments by AWB, the association stated in July that the carbon cap framework “will cost Washington state over 34,000 jobs, and $7.3 billion in sales by year 2035” with 46 percent of the lost jobs and $3.1 billion of reduced sales falling on small businesses. The figures were developed for AWB by the firm Energy Strategies…
In a required “Concise Explanatory Statement” (CES) issued last week responding to submitted public comments, Ecology does concede for the first time that based on how calculations are made, the costs of the carbon cap rule to employer stakeholders could exceed societal benefits.
There will doubtless more on this as the October 17 date gets closer. Also up for regulatory reconsideration is the state Growth Management Act. The Lens reports,
Representatives of Washington cities, counties, schools and citizens groups packed a committee meeting room in Olympia this week to urge that lawmakers amend the controversial Growth Management Act (GMA). Their suggestions included restricting the powers of the state growth hearings board, requiring more investment in roads where high-density development occurs, better facilitating conversion of fallow agricultural lands into jobs centers, and letting school districts meet growth needs with more flexibility.
The GMA, originally enacted in 1991, is seen by a widening array of stakeholders as an impediment to affordable housing in Central Puget Sound, and rural economic development. In certain locales statewide, GMA is seen as preventing the building of new schools needed to meet population growth, state classroom and subject matter mandates.
The article, which presents a balanced pro/con, should be read in its entirety. For additional context, see the Washington Research Council report we discussed and this op-ed in the Seattle Times.
Also slated for review – this time by the voters – is the state’s minimum wage, which Initiative 1433 would boost to $13.50. The measure also adds a paid leave requirement. For the editorial board of The News Tribune, it’s a step too far.
Unfortunately, it pushes a seemingly arbitrary threshold too fast and too far for many Washington communities to bear…Ours is an 80-percent service-sector economy; it depends on consumers with spendable incomes. But if employers cut back or go out of business because of an arbitrarily high wage floor, it’s the workers who ultimately will have nothing to stand on.
The paper thinks $12 might be a better number. That’s what Tacoma did. We’ve written about the minimum wage issue many times, including this discussion of the budget office’s analysis of I-1433
As Washington wrestles with regulatory policy, Texas provides a contrasting approach. Without endorsing Longhorn State policies, we find this special issue of City Journal worth reading. In particular we recommend the article on urbanism, Texas style, which introduced us to the phrase “opportunity urbanism.” This surprised us:
In fact, despite assertions that dense coastal cities are the natural incubators of innovative tech firms, an analysis of the last decade and a half shows that Texas’s sprawling metropoles are growing Science, Technology, Engineering, and Math (STEM) jobs more rapidly than the Bay Area—and far faster than New York, Los Angeles, and Chicago. Since 2001, STEM employment in Austin is up 35 percent, while Houston has increased these desirable positions by 22 percent and Dallas by 17 percent. STEM jobs have increased 6 percent in San Jose and 2 percent in New York over this same period. L.A. has seen no STEM growth; Chicago has lost 3 percent of such positions.
From the GMA to the workplace to cap-and-trade, the coming months will feature extended discussion of how best to regulate without curbing growth. Part of that discussion should also acknowledge as The News Tribune editorial did, that the state economy is not simply the metro economy. Finding the balance will be critical to preserving and extending prosperity statewide.