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Commentary: Unintended Consequences

By Merrie Spaeth

Dallas, TX –

Congress considers at least hundred of bills each session, so it's possible for some details to slip through the cracks. But commentator Merrie Spaeth says those details can come back to haunt you.

You've heard of Murphy's law: Everything that can go wrong, probably will. I'd like to tweak that for the upcoming political season: whatever the stated purpose of a law or regulation, it won't work the way it's advertised. This is because there are always unintended consequences. And just because they're "unintended" doesn't mean they are inconsequential.

Let's take a look at some examples: last session, Congress passed a bill which was advertised as preventing credit card companies from exploiting poor people or students. The Federal Reserve wrote the rules to implement the bill and required that cards could only be issued to people with a paycheck or a big savings account. What about stay-at-home Moms? Oops. Mom wants to go get a credit card from JCPenney or Kmart. Go ask Poppa. Chains like Sears, The Limited and others with women customers say customers are furious. The bill also aimed to impose fee limits on debit card transactions. Retailers loved that section of the bill. But now, a coalition of banks and groups which represent educators, low income groups and minorities are trying to get it repealed. One of the unintended consequences is less available credit for the people they represent.

Congress passed the Consumer Product Safety Improvement Act in 2007 after products from China were found to contain lead and other substances. It requires third party testing and labels for every product - every product - used by children 12 and under. The idea was to protect children. But one of the consequences is that it has put out of business hundreds of small companies that made hand crafted toys or clothes as well as small scale organic food producers. Not that they use or have lead. They can't afford the testing. A group of entrepreneurs have formed the Handmade Toy Alliance and their initial study finds that a number of toy manufacturers who closed their shops and let their U.S. employees go have outsourced their production to China! Thus the law has eliminated small businesses, and jobs, increased costs and sent business to China which caused the problem in the first place.

Let's talk about harsher DWI laws here in Texas. Because we wanted to be tough, we take away the licenses of offenders who won't take an alcohol test. People who advised against that were attacked as weak and providing a "free pass" to criminals. Well, the unintended consequences are that people who are arrested appeal the suspensions of their licenses. This clogs the courts and actually makes it harder to get a conviction, plus it diverts the focus from repeat, hard core offenders.

What should we be doing? Well, I've got a three point plan. First, be honest. This means allowing hearings and debate on a proposal. Engage the public about the unintended consequences that might occur. People are pretty smart and will understand the trade-offs involved in the issues we mention above - and others. Second, do not overpromise what a law or regulation can achieve. The bigger the promises and the longer and more complex the regulation or legislation, the more unintended consequences there will be, and the more expensive and disruptive they will be. The Congressional Budget Office analyzes proposed legislation for what it will cost. I'm generally in favor of shrinking government, but my third recommendation is to create a similar office, like the CBO, which would comment on unintended consequences. This will provide fodder for the hearings recommended as step one.

So as the candidates of both parties parade before you, ask them what they plan to do about intended consequences. Will they support our three point plan? Again, remember that just because consequences are unintended, they are very real.

Merrie Spaeth is a communications specialist based in Dallas.

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