Paying more attention to state and local politics
This month we saw the beginning of a new Congress, one where Democrats regained control of the U.S. House of Representatives, while Republicans modestly increased their majority in the Senate. This means that we have returned to a period of divided government in Washington — a point only underscored by the ongoing federal shutdown.
And if recent history is any guide, we cannot expect much in the way of major legislation from Congress in the coming years — not unless the parties are able to compromise on key issues on which they are deeply entrenched. But while much of the transition coverage has understandably focused on our reshaped political landscape at the federal level, the reality is that we should be paying more attention than ever to state-level politics because that is where we are most likely to see regulatory changes.
Republicans held a majority in two-thirds of state legislative bodies going into November’s election. But Democrats managed to flip six of those legislative chambers while winnowing away at the GOP’s control in states like Pennsylvania, North Carolina and Arizona. Democrats also wrestled control from Republicans in at least seven gubernatorial races. And while it is tempting to look at these developments from a federal perspective — perhaps speculating on what this means for the 2020 presidential election — that sort of thinking overlooks the stark reality that state and local politics matter.
The fact is that state and local authorities are responsible for much of the red tape that we all deal with, especially for small business owners who spend excessive time, energy and money in sorting out regulatory requirements daily. That is not to downplay the burdens of federal regulation. But with so much gridlock in Congress, we’ve seen more and more regulatory action at the state and local level over the past few decades, with legislators and regulators piling-on on top of already complicated federal requirements.
And that trend has only picked-up momentum as municipalities have increasingly balkanized regulatory requirements — imposing even more demanding standards than are required in the bluest of blue states.
For small business owners, it is especially daunting to keep pace with a perpetually changing regulatory landscape. But the tendency is for the regulatory thicket to grow. Legislators pile-on incrementally with various impositions that are usually well-intended, but which demand more time, energy and or money to navigate.