Monday, July 26, 2010

Saving Big Business

One of the ironies of the elites' supposed dislike of big business is that all their attempts to rein it in result in damage to small business. We've seen it with requirements that toy manufacturers submit their products for rigorous testing. The big toymakers are allowed to do it in their own in-house labs; small companies must fork over big bucks to have it done. This has virtually eliminated small companies and individuals from the toy market.

The new health care plan was welcomed by big companies like Wal-Mart -- they can afford it. Their mom-and-pop competition, on the other hand, may well be wiped out or have to eliminate health care insurance for their employees. Starbucks can pay the bucks the regulations San Francisco has placed on restaurants demand -- the small guys can't.

The latest example? Small oil drilling companies.

One of the biggest of the big oil companies may be responsible for the worst environmental disaster in U.S. history, but Washington's response to the BP PLC spill would give an advantage to such major oil companies while threatening to put their small competitors out of business.

Energy legislation that Senate leaders said they may take up this week would sharply raise or eliminate a $75 million cap on oil company liability for economic damage from spills — a change that poses no great threat to giants like BP, which is setting aside $10 billion out of its huge profits and assets to pay for claims related to the spill and has already paid out billions.

But opening up smaller companies to large or unlimited liability would make it prohibitively expensive for them to get the insurance they need to drill and would force many of them out of the deep-water drilling business, analysts say.

It has finally seeped into the public consciousness that it is small business that drives the economy and creates most new jobs; but every attempt by Congress to make us safer and more has the effect of hurting those same small businesses. We're in danger of becoming a a country where working for yourself is too expensive and the regulations too onerous to bother.

It's an unintended consequence of the zeal to regulate, but you'd think the current administration would be more sensitive to its effects. Wouldn't you?

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