Build back better from bottom-up

The Biden administration is pushing a $1.75 trillion “reconciliation” bill supposedly to revitalize our economy. But it won’t work.

Not only is the bill larded with wasteful spending and special interest giveaways, but there is a fundamental flaw: It fails to fix outdated regulations making it costly and inefficient to produce the goods and services it aims to expand. Instead of throwing trillions from the top-down, policymakers should modernize regulations and ease burdens holding people back.

As Washington logrolls, opposition is growing.

A poll of West Virginia and Arizona—home of Sens. Joe Manchin and Krysten Sinema, skeptics of the plan—found only about one-third of people there favor the bill. Nationwide, a majority of Americans say Washington is doing too much.

The concerns are well-placed. The bill exacerbates inflation and requires tax-hikes impacting middle-class Americans.

Despite the costs, the bill does not address the root causes of the problems. Consider three key provisions for housing, healthcare, and energy.

The bill includes $150 billion in housing subsidies, such as rent assistance.

But Vox warns it does not fix barriers to housing construction (like excessive zoning laws) and leaves a shortage of 2.8 million homes.

Housing researcher Paul Williams notes, “What you really need if you want to lower those new home prices, is you need to build more homes and there’s not that much of that in this bill.”

The bill spends $130 billion on Obamacare subsidies but access to care will remain restricted.

For example, more spending does not address overly restrictive licensing laws preventing qualified nurse practitioners from serving in roles they trained for— contributing to the national healthcare workers shortage.

The bill provides $320 billion for electric vehicles and energy subsidies.

One problem is that electric vehicle subsidies mainly benefit the wealthy and do little for the environment. Moreover, the bill would steer the subsidies to unionized producers. Workers can decide for themselves if they want to unionize but paying them to unionize doesn’t help the environment and risks making U.S. producers less competitive with rivals abroad.

Our country needs a better way.

There are many practical reforms that can reduce the cost of goods and services while spurring job creation by streamlining regulations.

There’s common ground for this approach.

New York Times columnist Ezra Klein recently observed more left-leaning Americans recognizing the need to simplify regulations.

“Progressives are often uninterested in the creation of the goods and services they want everyone to have…The problem is that if you subsidize the cost of something that there isn’t enough of, you’ll raise prices or force rationing.”

“But look closely and you can see something new and overdue emerging in American politics: supply-side progressivism,” Klein writes.

For example, local groups in Seattle and San Francisco are urging zoning-law reform to build more housing and bring down costs.

Clearly, these ideas have not reached many policymakers, but it’s a starting point.

What reforms are needed? One major area of federal redtape is the National Environmental Policy Act (NEPA).

NEPA was enacted in 1970 to account for environmental impacts during construction.

But now reviews can run to nearly 1,000 pages, drag on for a decade, increase costs by millions, and be weaponized to block everything from housing to wind turbines (one reason renewable energy advocates are among many who favor NEPA reform).

The Biden administration even rescinded NEPA reforms adopted in 2020 which had broad support.

Despite political roadblocks, the solution is straightforward. NEPA can be streamlined by appointing a single lead agency to manage reviews—rather than several today—setting a twoyear deadline and focusing on measurable, significant environmental impacts. This reform could reduce some permitting delays by 75 percent.

Furthermore, Congress can make temporary healthcare reforms enacted during COVID-19 permanent.

For instance, Congress should allow nurse practitioners to practice outside their home state without requiring redundant licenses. Expanding access to nurses can reduce primary care costs by nearly 25 percent while improving outcomes.

Other reforms, like importing more prescription drugs from countries we trust, can also improve care.

These are just a few of the options to revitalize our economy without more wasteful spending, tax hikes, and inflation.

Congress should reject the reconciliation bill and focus on reforms that give people the flexibility to create solutions.

James Davis