Will Trump’s Deregulatory Push Save Lives? | Stock News & Stock Market Analysis

Regulations: By all accounts, President Trump is moving aggressively to lighten the regulatory burden on the economy. While the discussion has focused on saving businesses money, could the effort also be a lifesaver?

For decades, free-market conservatives have pointed out that federal regulations can easily backfire, costing lives rather than saving them.

The auto fuel economy mandate, for example, forced automakers to build smaller cars, which led to more highway deaths from crashes because smaller cars provide less protection.

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The FDA’s cumbersome and costly approval process for new drugs can cause needless deaths from people denied new treatments that could have been on the market sooner.

Increasing airport security can be deadly if, by making air travel more inconvenient, it prompts people to drive instead of fly.

Other safety regulations can induce people to take greater risks, on the assumption that the new safety features will protect them. Drivers in cars with anti-lock brakes, for example, tend to drive more aggressively. Skiers wearing helmets tend to go faster.

A new study published by the Mercatus Center at George Mason University shows that there’s another way that regulations can cost lives — if they cost too much.

The basic premise is that there is a clear connection between prosperity and longevity. Something that reduces prosperity will have an impact on lives. So, if a regulation promises to save 100 lives, but costs a king’s ransom to implement, the net result could be that more people die from lower income than are saved by the rules. (Remember, these are all statistical lives lost and saved, not actual lives.)

XThe idea that there’s a tipping point for regulations has been around for a while, but the new analysis, by Vanderbilt University’s Kip Viscusi and Mercatus Center research fellow James Broughel, applies new statistical techniques to come up with what they say is a more precise cutoff point.

What they found is that if a regulation costs $99 million a year, it will cause one extra death in the country. So if the proposed regulation doesn’t save more than one life for each $99 million in costs, it will result in a net loss of life.

By this calculation, expansions to Medicaid made before ObamaCare cost up to $867,000 per life saved — well below the cutoff point.

On the other hand, several air quality regulations from the EPA impose costs that are well above that threshold.

As the authors note, this way of measuring things can help lawmakers “screen out ineffective policies.”

More important, it’s a reminder that there are always two sides to any coin — a commonsense notion that always gets forgotten when big-government types are pushing for more federal regulations.

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Originally posted 2019-09-19 23:35:08.


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