This article is about a concept that many people find obscure, but that in the real world is one of the most important causes of rising prices in the United States. That is something called ‘Regulatory Capture’.
Regulatory Capture occurs when a government regulation affecting consumers is based on information from lobbyists rather than good science. The replacement of Freon in air conditioners with r134 is a classic example of this. The official reason was that freon was damaging the ozone layer. What they didn’t tell you was that Freon could not possibly be damaging the ozone layer because the chemical composition of freon was such that it decomposed into harmless gases before it could reach high enough in the atmosphere to affect the ozone layer.
Environmental groups, who have never cared about science unless they can twist it to support their view, teamed with car and home air conditioning companies to get the regulations passed to ban freon. Air conditioning companies supported the regulation because it forced everyone in the country to buy new air conditioning systems. The only damage was to people’s wallets.
Why do I bring this up today? Well, the same suspects have teamed up again, once again using bad science, to make us all pay more for air conditioning. Again. https://trdsf.com/blogs/news/epa-refrigerant-regulation . The claim is that the coolants cause global warming, once again ignoring the fact that the gases break down into their components before it can possibly have an effect.
President Trump has recently signed an executive order requiring that new regulation be based on the best available, reproducible, science https://www.whitehouse.gov/presidential-actions/2025/05/restoring-gold-standard-science/. The order also requires that no one who is sitting on the board that approves the regulation can have a professional or monetary interest in the studies that the regulation is based on.
Normal people would think that requiring a disinterested third party is just common sense, but the Democrats are bitterly complaining that this regulation is ‘anti-science’. Evidently, it’s not anti-science if the same people writing the regulations are the people that make money from the regulations.
But that is not the whole story of regulatory capture in the EPA, the story goes back decades to the founding of the EPA. The first well known rule that the EPA wrote banned the use of DDT in the US. This was based on (we were told) studies that found that DDT was causing Bald Eagles to become nearly extinct because DDT was weakening their eggshells. What they didn’t tell you was that there were exactly two (disparate) studies, neither of which was reproducible (a requirement of good science), and neither of which actually indicated that DDT may be the cause. In this case, the regulatory capture was the environmental extremists who had read Silent Spring and believed it despite the horrible science in the book, along with the EPA administrator who wanted a big name win at the start of his term.
But DDT was banned, and in the US it is still cited as a success of the EPA. What they don’t tell you is that when the US stopped producing DDT, it cut off supplies to other countries that were using DDT, such as India, and subtropical Africa. Before the banning of DDT, these countries had been well on the way to eliminating serious mosquito born illnesses such as Malaria and sleeping sickness. After the ban, the numbers killed by these illnesses went up dramatically, resulting in tens of millions killed around the world because the US banned DDT. Are millions dead based on bad science a success?
Since that time, environmental groups have considered the EPA to be their personal stomping ground. Whether its rules about CO2 emissions, or mercury from Coal plants, those rules are not written using the best science. They are written using the science that environmental extremists approve of. And the result is rising prices with no actual improvement.
The single most important reason for this executive order is probably the EPA rules on pm 2.5 particles. The EPA has very tight emissions rules on pm 2.5 as the claim is that these particles cause hundreds of thousands of premature deaths each year. Yet the science behind the claim is based entirely on a study that has never been reproduced because the actual methodology used has been kept secret. https://junkscience.com/2023/03/pm2-5-mass-killer-or-mass-fraud/
More recently, we all remember COVID. And the federal requirements for vaccinations. What they don’t tell you is that the same people recommending that the federal government require covid vaccines were making millions from those companies making the vaccines, including Congress. In fact just a few minutes of research, and we discover that drug companies are the single largest donor to both parties in Congress.
Another example of regulatory capture is in the health care industry. For many years, It was very difficult for health care organizations to work as for-profit organizations. The rules were very strict, and patient care was required to be their number one concern. In 1973 the rules were lessened dramatically, and we ended up with the system today. Almost every non-profit and charitable organization and hospital has become for-profit, and we have ended up with the current system that is nearly unaffordable, every major health care expense must be pre-approved, and insurance companies make more money if it’s not approved.
Still on healthcare, did you know that the reimbursement rate of procedures for medicare is set by a committee of doctors that treat medicare patients? Its hard to find a more perfect example of regulatory capture. They not only set the reimbursement rate, but they set what procedures can be reimbursed.
Now admittedly, the president’s new rule that requires that the science be reproducible and unbiased won’t fix the problems with health care, but perhaps it can be used as a basis to make a decent attempt at a fix.
Regulatory capture is an obscure, but huge, problem in the US, and in the rest of the world.
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