HY 357 Lecture Notes - Lecture 57: Prescription Drug, Aarp, Aid To Families With Dependent Children
6 Jun 2018
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Policymaking in Action
There are three broad areas of public policy: domestic, economic, and foreign. Some political
scientists would include defense policy as a fourth. In domestic affairs, there are two major
categories: regulatory policy and social welfare policy
Regulatory policy
Through regulatory policy, the federal government supervises the actions of
individuals, businesses, and government institutions. Historically, the desire for
regulation grew out of widespread unhappiness with the actions of profit-making
businesses. For example, railroads in the late 19th century often charged more for
shipping over short distances than over long ones. This pricing made sense for their
business needs, but it was politically unacceptable because the nation's numerous
small farmers were more likely to send goods a short distance, and the pricing was
perceived as discriminatory. This and other discriminatory rate practices led to the
creation of the Interstate Commerce Commission (1887) and rate regulation. During the
Progressive Era, exposés about the way the food and drug industries operated resulted
in Congress's passing the Pure Food and Drug Act (1906), which created the Food and
Drug Administration (FDA).
Regulatory activities include setting fair prices for goods and services; granting licenses
and franchises; establishing safety standards for the workplace and transportation;
providing resources, such as hydroelectric power from federal dams, and setting rates;
monitoring and enforcing compliance with statutes relating to discrimination; and
protecting the environment.
The scope of regulatory policies can be seen in the array of independent commissions
and agencies responsible for their implementation. In addition, there are the Securities
and Exchange Commission (SEC), which watches over the stock markets and stock
transactions; the EPA, which safeguards the environment; the Federal Energy
Regulatory Commission (FERC); the Occupational Safety and Health Administration
(OSHA) and the Consumer Product Safety Commission (CPSC), both of which were
created in response to the failure of business to adequately protect its workers and
customers; and the National Transportation Safety Board (NTSB). Also, many federal
regulatory agencies have their counterparts at the state and even local levels.
Criticism of regulation and deregulation
Regulatory policy is usually criticized because of the costs it imposes on business.
American consumers and workers generally bear those costs: consumers through the
price of products; workers when their place of business must compete with unregulated
foreign concerns. Nevertheless, setting domestic policy through regulation is tempting to
federal legislators because it allows them to take action on a problem and command a
change of course without directly paying for anything they order. Another concern with
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Document Summary
There are three broad areas of public policy: domestic, economic, and foreign. Some political scientists would include defense policy as a fourth. In domestic affairs, there are two major categories: regulatory policy and social welfare policy. Through regulatory policy, the federal government supervises the actions of individuals, businesses, and government institutions. Historically, the desire for regulation grew out of widespread unhappiness with the actions of profit-making businesses. For example, railroads in the late 19th century often charged more for shipping over short distances than over long ones. This pricing made sense for their business needs, but it was politically unacceptable because the nation"s numerous small farmers were more likely to send goods a short distance, and the pricing was perceived as discriminatory. This and other discriminatory rate practices led to the creation of the interstate commerce commission (1887) and rate regulation.
