PUBLIC POLICY AND REGULATION

A few years ago, it was unlikely anyone would write a paper on public policy and regulation. The field was reasonably welldeveloped, the issues well-defined, and the consequences of policy alternatives agreed-upon. It was generally agreed that the purpose of government regulation of business was to cure competitive imperfections in the marketplace. Most scholars agreed the regulatory agencies were largely captured by the regulated interests, and there was a comfortable and cooperative relationship between the regulator and-the regulated. Most of the agencies were organized on an industry-by-industry basis, i.e., Interstate Commerce Commission, Civil Aeronautics Board, and the Federal Communications Commission. The Congressional Acts creating the regulatory agencies were general statements which conferred extremely broad powers to the agencies, and provided little specific policy guidance except to tell the agency to act in the public interest. Most students of the politics of regulation described the political relationships as an "iron triangle" that is, a coalition made up of the regulated industry, the regulatory agency, and the congressional subcommittees with jurisdiction over the agency. Business had the power to gain a dominant position in the triangle, but had to operate within the discipline and constraint of the "iron triangle." The net result was that the regulatory agencies did not serve the public interest, but promoted special interest at the expense of the public. Businessmen would complain about regulations, but. did not strongly oppose them. Argument existed in academic quarters as to whether the whole process of regulation was truly concerned with remedying imperfections in the marketplace or was a technique firms used to escape the competitive forces of the marketplace. Recently, new and different phenomenon have appeared on the regulation scene. Horror stories of regulation by new agencies and new regulations by old agencies are coming to the fore. An example was given at the 1976 Public Policy Education Conference by William Allewelt, who is president of the Tri/Valley Growers, a cooperative canning enterprise in California. Allewelt tells the story of the Tri/Valley Growers, Food and Drug Administration (FDA), and a mold with the name of geotrichum, viewed as totally harmless by the industry. Wherever fruit is grown, the mold exists in the summertime. Thus, it is impossible to avoid it in the summer season fruit canning operations, as well as in household kitchens. The applicable regulations of the FDA contained no tolerance for this mold. Thus, in effect, the agency mandated a zero tolerance when it decided to be concerned about the mold. Tri/Valley Growers was forced to move from three seven-hour shifts to two shifts working nine to ten hours each, in order to achieve proper sanitation to reduce the level of the mold. This led to an estimated loss of 1800 seasonal jobs in the communities where the fruit canning plants