Regulation Size

The next time a politician talks about returning power to the states at the same time they talk about relieving the regulatory burden on American businesses, consider this:

The Federal minimum wage is $7.25 per hour.  In Arizona, it is $7.65.  In California, it is $8.00 and the state calculates overtime pay rates differently than federal law.  San Francisco, which is in California, has a $10.24 minimum wage.  Minnesota has a $6.15 minimum wage that is lower than the federal minimum but only small businesses grossing under $500,000 a year that do not engage in interstate commerce may pay their employees this lower rate.

In all, 23 states follow the federal minimum.  5 states do not have a minimum wage, so follow the feds by default.  22 states, plus the District have different guidelines.  All this is before we consider the various state statutes, ordinances, and proclamations on the definition of mandatory break time after shift work, rules for the payment of final wages, and the definition of an “employee”.  In 50 states plus the District, it’s all different.

Keeping track of all of these sometimes contradictory laws and keeping a company within legal compliance falls to poor slobs like me.  I can tell you from experience that these regulations are a burden, often necessary, usually well-intentioned, and sometimes a pain in my behind. 

 

I can also tell you one more thing: the more that the regulatory burden at the federal level is minimized and that power turned over to the states, the more confusing the patchwork of rules will become and potentially, the more burdensome on businesses, most of whom today conduct business across state lines.

State by state variations in the speed limit make sense.  Gun laws by state make sense.  That does not mean that state by state control of regulations always simplifies business processes or reduces business costs.  It doesn’t.

So the next time a politician talks about returning power to the states at the same time they talk about relieving the regulatory burden on American businesses, consider this.