The Effect of Regulation on Auto Repair

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It’s no secret that the Trump Administration has been focusing its efforts on reversing the direction the Obama Administration was steering in many different ways. One major area is reducing regulation. Trump began his presidency announcing that he would cut regulation by as much as 75 percent, noting that “some of that stuff makes it impossible to get anything built.” In the 20 months since he’s been in office, he’s followed through, including cutting the staff of EPA enforcement down 10 percent. How does this affect small businesses?

In February of 2017, the month after President Trump was inaugurated, the National Federation of Independent Business reported that half of the small business owners they surveyed reported that regulations were either a “somewhat serious” or “very serious” problem. NFIB President and CEO Juanita Duggan said, “Small business owners are drowning in regulations imposed by every level of government. It’s a major problem affecting millions of businesses, and the federal government is the biggest contributor.”

How exactly do these regulations affect small businesses? They add costs and confusion. Not only do businesses have to remain updated about new regulation, but they have to devise ways to work around it and train their employees on how to comply.  Larger companies can afford to hire employees who will specialize in dealing with the red tape regulation causes, but small businesses cannot. Often they don’t understand how complying with regulation even helps.

Most repair shop owners will tell you that EPA interference and their laundry list of what can and cannot be done creates a tremendous amount of hassle without a great deal of benefit. For instance, the rule that auto repair shops are not allowed to wash a car outside because the soap might run downhill? Is that necessary or even effective? Preventing pollution is a noble goal, but does more regulation do that?

In 2011, Rep. Bob Gibbs of Ohio wrote, “The jurisdiction of the Army Corps of Engineers and the EPA under the Clean Water Act is currently restricted to the ‘navigable waters of the United States.’ The term ‘navigable’ has been interpreted by the US Supreme Court in recent years in a series of court cases, yet the EPA is working on a new ‘guidance’ that would effectively change the meaning of ‘navigable waters’ to mean ‘anything that gets wet.’”

“This means that the EPA could potentially regulate anyone or anything that comes in contact with water, even a regular citizen washing their car in their driveway. This dramatic overreach of bureaucratic authority could result in a massive increase in regulations on not only the business community, but even individual citizens who could face dramatic compliance costs and even citizen lawsuits.

“The bottom line; the EPA has grown out of control in recent years. With billions of dollars in budget increases under the Obama administration, the agency has been given free rein to go after our businesses, small and large. Bureaucrats do not have to stand for election before the American people, and therefore feel a sense of invincibility in pursuing their own personal agendas, much like the EPA and their ‘guidance’ process.”

This is the reason for President Trump’s emphasis on deregulation. So far the result has been slashing the pages of the Federal Register from 95,894 pages in 2016, under Obama, to 61,308 pages last year. The Federal Register is now the same size as it was in 1993, and it’s expected to get even smaller in 2018 and 2019. Since all of this regulation acted as another tax on businesses and households, this explains why economic growth, employment, household income, and business and consumer confidence have bounced back finally from the bleak years of the Great Recession.

How has the move towards deregulation affected your auto repair shop? Have you seen a difference in your profits, time spent on paperwork, or stress levels? The Automotive Management Network would love to hear your side of the story, whether that supports deregulation or not. Please weigh in here to share your experience.

 

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