It’s unfortunately par for the course in recent history for American presidents to pursue unilateral executive action instead of the more difficult, yet constitutionally preferable, business of working with Congress to pass legislation. Intended to “establish a whole-of-government effort to promote competition in the American economy,” President Biden’s latest sweeping executive orders are just the latest example.
The vast set of orders contains 72 different initiatives involving more than a dozen different federal agencies. It starts at least from an agreeable, if vague, premise: promoting competition in the economy. Left-leaning economists and free-market economists alike would agree that, generally speaking, competition in markets fosters more innovation, lower prices, and better outcomes compared to monopolies or markets otherwise dominated by a select few industry giants.
But the details of Biden’s sweeping orders warrant a more mixed reaction. Some admittedly admirable pro-competition and pro-free-market measures are jammed into a lengthy list of bureaucratic expansions and calls for big government intervention. I went through the vast orders and pulled out the highlights—and lowlights—so you don’t have to.
First, let’s start with the good.
3 Promising Reforms in Biden’s Orders
1. Reducing licensing barriers to work and entrepreneurship. The White House laid out its ambitions to ban or limit “unnecessary, cumbersome occupational licensing requirements that impede economic mobility.”
This is an area of reform that free-marketeers have long promoted. Unwarranted licensing laws lock would-be hair-braiders, florists, and many other entrepreneurs (even down to lemonade-stand vendors) from entering into business unless they pay vast sums and jump through various hoops to get expensive, unnecessary certifications. These laws serve only to stifle labor force participation and protect crony established interests from competition. One study found that onerous occupational licensing blocks 2.8 million jobs and costs consumers $203 billion a year in artificially high prices.
2. Lower prescription drug costs by importing from Canada. The executive orders encourage federal agencies to support the importation of safe and effective medications from Canada, which is currently largely restricted. This would allow for lower prices and more options for American consumers who have been needlessly locked out of buying the same medications available for cheaper just across the border.
3. Reducing costs by making hearing aids available over-the-counter. Right now, it’s unlawful for hearing aids to be sold without visiting a specialist or doctor, even though experts say this is often unnecessary. The White House orders decry this “red tape” as a needless “barrier to more companies selling hearing aids,” and call for federal rules allowing low-cost options to be sold over the counter. This would be a pro-free-market reform and help millions of hearing-impaired Americans afford the care they need.
3 Alarming Plans Included in the Biden Orders
1. The restoration of Obama-era “Net Neutrality” internet regulations. The White House orders push the federal government to reinstate unnecessary regulations on Internet Service Providers. It does so even though none—genuinely none—of the alarmist predictions about the supposed slowdowns that would happen after the Trump administration repealed the rules ever came true.
If— Senate Democrats (@SenateDems) February 27, 2018
time.#savethenet #savetheinternet #netneutrality #onemorevote
Instead, internet speeds have increased and investment into expanding broadband access has risen with the costly, cumbersome, and archaic rules out of the way. Biden’s stated plan to reverse this reform would be a massive mistake.
2. Massively expanding union power with the “PRO Act.” Included in the executive orders is another call for the passage of sweeping legislation that would vastly boost the control corrupt unions have over the economy at workers’ expense. It would also reclassify independent contractors and freelancers under federal law, potentially endangering the livelihoods of everyone from Uber drivers to freelance journalists. This bill is a threat to competition, not a boon to it.
3. Big expansions of antitrust enforcement. The White House plans call for increased anti-trust action against Big Tech and many other industries, as well as the blocking of many more mergers and acquisitions, all in the name of promoting competition. However, just as we’ve seen with recent antitrust bills in Congress, these actions would have little real benefit. Many would only end up hurting consumers and blocking companies from giving away free services and promoting affordable products, imposing billions in regulatory costs in the meantime.
The Bigger Problem with Biden’s Approach
As outlined above, there are good and bad elements alike in the president’s sweeping plan. But the entire premise of the White House taking such unilateral action via executive order, rather than through constitutionally-mandated collaboration with Congress (or even better, leaving it to the states), is a threat to the separation of powers that keeps government abuse in check.
“The size and scope of this order is a complete affront to the Constitution,” Patrick Hedger of the Taxpayers Protection Alliance explained. “A policy agenda like this should be introduced as legislation in Congress, not phoned in by an executive to unaccountable bureaucrats.”
We should indeed give the Biden administration credit for good policy where it’s due and criticism where warranted. But all Americans who value the constraints in our system of government that keep us free should be concerned by the approach the president is taking in pursuit of these reforms.
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