Why Government Regulation has Developed

The extent of regulatory activity prompts us to ask what other factors account for its development. One way to explain it is a scenario of deliberate decisions by bureaucrats and their political allies to expand their sphere of influence over private-sector activities. This explanation, often heard from conservatives to criticize regulations which they oppose, is not a generally applicable explanation.

Motives of compassion have led to rules and regulations aimed at protecting people from each other-governing relations between buyers and sellers, employers and employees, or lenders and borrowers. The broader use of regulations also stems from efforts to increase public representativeness in government decision-making processes as one way to maintain popular control and equitable treatment. Provisions of the Administrative Procedure Act of 1946 require procedural fairness in administrative agency operations (including detailed guidelines for public participation in many aspects of administrative decision making). A maze of rules is designed to minimize dishonesty and corruption in public affairs.

Regulation has been fostered by a willingness to have government protect individuals, groups, and society at large from many ills and evils. In virtually all cases, no intent to create red tape has existed, but it has inevitably accompanied each effort. Past administrations streamlined many aspects of the national government’s regulatory activity. Although a large part of this focus on regulatory restructuring was directed toward cutting internal agency regulations, past administrations have been concerned about regulations that affect private citizens and organizations.

The National Performance Review (NPR) signaled a clear intent to cut back unnecessary regulation in all respects.