The United States: The Destruction of the Regulatory State

In short, a regulatory state is one in which private actors are allowed to pursue their goals until these actors cause pain and disruption to the state and its population.  The state then moves in and regulates whatever activities caused the disruption so that it will not happen again.  Legislation is often required to impose appropriate constraints on private activities.  Consider a market failure that has led to a monopoly situation in which one provider of a service or product controls prices and service availability and is using its advantage to restrict competition and charge exorbitant prices for its contribution to the economy.  The state will require a team of experts to understand how this situation developed and what type of legislation and regulation might be needed to correct the situation.  Legislation tends to be general in an attempt to capture a range of possible threats to the state, regulation tends to be specific, making it difficult to incorporate all possible cases into the legislation.  This team of state experts must remain available over time to evaluate other circumstances as they arrive from continued variations in activities presented by the private actors.  Some team of experts within the state must judge whether the specific activities encountered fall under the purview of the legislation and if a regulatory response is necessary and legally appropriate.

One can produce a short version of the economic history of the United States.  It would describe a series of events in which private actors discovered a means to make a lot of money in such a way that they benefited but society in general suffered.  In other words, the rich got richer and the poor got poorer.  The state intervened to provide more balance and limit the power private entities could accrue, and society moved on.  Inevitably, subsequent episodes would occur and the process was repeated.

Private actors have never liked being regulated and have long tried to weaken or eliminate this function of the state.  This, in spite of wealth in millions transitioning to wealth in billions. The attack has followed two paths, one judicial and one political.

 The judicial approach was to argue that if a given law contained ambiguities relative to a given case, the interpretation should be made by courts rather than the state agencies involved.  In 1984, in Chevron v. Natural Resources Defense Council, the Supreme Court ruled that if the agency’s interpretation seemed reasonable it should be upheld.  This became known as the “Chevron doctrine.”  Last year, 2024, the Supreme Court voided the Chevron doctrine and placed responsibility for interpretations on the courts.  The wealthy and the powerful took this as a win.

The political approach was to take control of the Presidency and Congress and make the agencies provide politically correct rulings.  Until Trump and Musk, this approach had not been very successful.  Civil Service rules made wholescale firings of federal employees difficult.  Musk and Trump came along planning to do whatever they wanted and dare anyone to try and stop them.

Their approach has been to fire people who are easy to fire and terrorize the remainder hoping that they will resign and go away.  This is not an approach designed to provide functional governmental agencies.  It is an approach designed to eliminate such agencies and replace them with something.  But what?  Given that Musk is driving the process, it will have something to do with technology.  Will each agency be replaced by an AIbot trained on libertarian principles?

Best bet: before the collapse of the federal workforce is complete, the public will notice that government agencies provide useful services and raise enough of a stink that even Republican politicians will fear for their careers and put a halt to it.

You can learn a little about a lot of things or you can learn a lot about a very few things. Guess which is the most fun.