May 22 2018
Chairman Erik Paulsen delivered his opening statement for the Joint Economic Committee's hearing on "Breaking Through the Regulatory Barrier: What Red Tape Means for the Innovation Economy." In his remarks, Chairman Paulsen emphasized the importance of maintaining a dynamic approach to regulation that matches the dynamism of American innovators. The full text as prepared for delivery appears below. The livestream appears here.
Good afternoon and welcome to today’s hearing on “Breaking Through The Regulatory Barrier: What Red Tape Means For The Innovation Economy”
Bloomberg recently reported that the U.S. dropped out of the top 10 in the 2018 Bloomberg Innovation Index for the first time in six years.
We were at 9, and now we are at 11.
Such news is a call to action. America’s tradition of invention has been at the heart of our economic strength.
As lawmakers, we must recognize that the only way forward is to place our trust in the American people, and to get out of the way.
The private sector knows all too well how needless red tape imposes costs on businesses, increases prices for consumers, and reduces consumer choice.
For innovation, however, the impact can be worse.
In Washington, regulators can put an idea to death before it is ever tried, foreclosing a future of opportunity and progress.
We should know better. Americans enjoy a better quality of life today than decades ago, thanks to technological innovation.
U.S. leadership in the world has been based largely on technological prowess, and for it to continue, our regulations must foster innovation rather than inhibit it.
We will hear examples from our witnesses today of regulation hindering advances and, perhaps worse, even driving it away to other countries.
Not all regulation is bad. After all, some is important for giving job creators necessary guidance and stability in their work. When done well, sound regulation can make up for where markets fail to appreciate important public benefits or costs.
That’s why we’re holding this hearing: How should we approach regulation so that it’s as dynamic as America’s tinkerers and inventors? In other words, how can we stop hurting, and start helping?
Our regulations should always serve the public interest with minimum collateral damage to the economy. Where innovations are concerned, regulators shouldn’t slam the door in the face of new ideas.
Our economy—in particular, the American people themselves—should be given the opportunity to integrate these innovations in their lives.
An advance that can improve lives and raise productivity generally leads to higher wages—and many Americans are in dire need of that kind of prosperity.
After all, technological progress is what ultimately brings us better living standards.
It makes little sense to thwart promising innovations that can make our lives easier, improve our health, provide new products and services, and help U.S. firms compete internationally.
Consider that the majority of start-up firms are in the tech sector. We should encourage the dynamism they contribute to the economy.
If we fail to make improvements, fast-moving technology will be moving offshore even faster.
As we will hear today, sound regulation is aware of and anticipates technological change.
I like the concept of “permissionless” innovation. Our inventors and entrepreneurs should not have to ask for permission to make things better.
The U.S. technological edge and competitive advantage in a variety of sectors is narrowing, and to some extent through unforced, self-inflicted regulatory wounds.
I am keenly interested to hear what our expert witnesses have to say today, especially how we might improve our regulatory regimes.