Bush’s Regulatory Crackdown on Business Has Harmed the Economy.
In a major speech on July 9, 2002, in the wake of the Enron and WorldCom scandals, President Bush announced a series of regulatory initiatives to “expose and root out corruption” in American business. Stressing that “the vast majority of businessmen and women are honest,” and that reforms “should demand integrity, without stifling innovation and economic growth,” Bush said that his proposals “should be welcomed by every honest company in America.”
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Businessmen are, in the words of Jack Welch, “hunkering down"; they are investing less money in new technologies, new manufacturing plants, research and development; they are reluctant to enter mergers, to formulate new strategies, *to take risks*–and our economy is suffering as a result.
The cause of the business stagnation is that Bush has done the opposite of what he promised: his administration has persecuted the honest, productive businessmen who drive the economy.
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The essence of the new environment is that now, more than ever, businessmen *cannot know what is legal or illegal until after the fact*. They have no means of knowing in advance whether their accounting methods will get them thrown in jail, whether they will be bankrupted by a class-action lawsuit for “defrauding shareholders” if their new product does not sell as well as expected, or whether a strategic merger that takes years of planning will be thwarted by some ambitious bureaucrat. The result is that honest businessmen have been paralyzed when it comes to steering their companies.
