2. The Rise (and Fall?) of
Government Regulation
▪ Role of regulatory activities: limit
prices/practices OR promote commerce
▪ Regulatory history:
▫ Regulation of interstate commerce was
constitutional power granted to Congress
▫ But states initially had responsibility
3. The Rise (and Fall?) of
Government Regulation
▪ Post Civil War, national government assumes
more regulatory control
▪ Pressure increases to regulate abusive
industries (especially railroads)
▪ New Deal gives national government primary
economic responsibility/control
4. The Rise (and Fall?) of
Government Regulation
▪ But regulatory policy too detailed & complex
for legislatures
▫ Need dedicated regulatory bodies
▫ Need flexible decision makers
▫ Authority delegated to regulatory agencies
▫ Congress shifts to monitoring role
5. The Rise (and Fall?) of
Government Regulation
▪ Interstate Commerce Commission (1887)
▪ National leaders promote regulation
▪ Sherman Antitrust Act (1890)
▪ Federal Trade Commission (1914)
▫ Clayton Act
6. The Rise (and Fall?) of
Government Regulation
▪ Other regulatory agencies modeled after ICC
and FTC
▫ Federal Communication Commission
(1934)
▫ Securities and Exchange Commission
(1934)
▫ Civil Aeronautics Board (1938)
▫ Many state regulatory agencies
7. Other Major U.S. Regulatory Bodies
Consumer Product Safety Commission (CPSC)
Equal Employment Opportunity Commission (EEOC)
Environmental Protection Agency (EPA)
Federal Energy Regulatory Commission (FERC)
Food and Drug Administration (FDA)
U.S. International Trade Commission (ITC)
National Labor Relations Board (NLRB)
Nuclear Regulatory Commission (NRC)
Occupational Safety and Health Administration (OSHA)
8. The New Social Regulation
▪ Economic regulation focuses on markets,
rates and obligation to serve
▪ Social regulation affects conditions of
production and characteristics of
manufactured products
9. The New Social Regulation
OLD (economic)
Civil Aeronautics Board (1938–1985)
Federal Communications Commission
Federal Power Commission (until
1976)
Securities and Exchange Commission
(until 2002)
Federal Trade Commission
NEW (social)
Consumer Financial Protection Bureau
Consumer Product Safety Comm.
Equal Employment Opportunity Commission
Environmental Protection Agency
FCC
Financial Stability Oversight Council
Federal Energy Regulatory Commission (since
1977)
Food and Drug Administration
International Trade Commission
National Labor Relations Board
Nuclear Regulatory Commission
Occupational Safety and Health Administration
10. The New Social Regulation
▪ Shift in focus begins in early 1960s
▫ Growing environmental and consumer
movements
▫ New social regulatory initiatives
▫ Interest group mobilization
▫ Congress delegates authority for regulatory
activity but maintains oversight
▫ New regulatory conflicts emerge
11. Why Government Regulation Has Developed: Other
Perspectives
Other factors in regulatory rise:
Deliberate expansion of political control
Government response to public pressures about
unfair practices or alleviating distress
Ensuring fair and equal administration
Role in preventing economic or political
disruptions
Increasing public representation in government
12. Why Government Regulation Has Developed: Other
Perspectives
▪ Regulatory rise attributed to willingness to
have government protect individuals, groups
and society
▪ But many administrations attempt to
streamline “regulatory overkill”
13. Structures and Procedures of Regulatory Bodies
▪ Similarities among agencies:
▫ Authority delegated by Congress
▫ Some functional overlaps
▫ Political influence important in process
14. Structures and Procedures of Regulatory Bodies
Dependent regulatory agencies are housed within
existing departments
FDA (Dept. of Health and Human Services)
Independent regulatory commissions
Plural leadership not politically appointed
Collective decision-making process
Fixed terms for leaders (often long)
Abrupt policy shifts unlikely
15. Structures and Procedures of Regulatory Bodies
▪ Regulatory procedures: rule making and
adjudication
▫ Federal Register
▫ Code of Federal Regulations
▫ Administrative law judges
16. The Politics of Regulation
▪ Regulation involves politics of privilege and
patronage
▪ Issues involve distribution, quality and price
▫ Example: cable television industry
17. The Politics of Regulation
▪ Political environment of regulation
▫ Legislative oversight by Congress
▫ Expenditures (OMB, appropriations)
▫ Budget cuts and deficit reduction plans
▫ Clientele (such as industries it regulates)
▪ Protect or regulate industry?
18. The Politics of Regulation:
Role of the President
▪ President appoints cabinet-level department
heads, but career employees direct agency
work
▫ But presidents can have powerful
influence
▫ Usually allows industry leaders to have
informal voice in agency head selection
▫ Directs OMB
19. The Politics of Regulation:
Role of Congress
▪ Annual appropriations consideration
▪ Committee oversight of regulatory bodies
▪ Agencies respond to political pressures
transmitted thru Congress
20. The Politics of Regulation
▪ Criticisms of regulatory agencies:
▫ Too influenced by industries they are
supposed to regulate
▫ Regulators often return to industry
▫ Common Cause
▪ Regulators expected to be expert but
detached
21. The Politics of Regulation
▪ Rise of consumer movement caused increase
in government regulation
▫ Nader’s Raiders
▫ New political pressures
▫ Reliance on regulatory agencies
▪ But recent growing resentment toward
consumer-oriented regulation
