Are Companies Under-Regulated or Over-Regulated?
Market economies have always struggled to achieve the proper balance of business regulation. On the one hand, regulations are necessary to promote public safety, protect workers, prevent fraud, safeguard the environment and create fair rules for business competition. On the other hand, regulations can hamper economic growth, drive up costs or have other unintended consequences.
In Washington, D.C., and in state capitals, debate over the amount and type of government regulation continues to divide the nation. Americans are split nearly evenly in their views on the effectiveness of government oversight, states the 2015 Public Affairs Pulse survey.
Mixed Views on Regulation
Forty-seven percent believe government regulation of business is necessary to protect the public interest, while 49 percent say regulation usually does more harm than good. This finding is consistent with Americans’ opinions last year but represents a shift from just two years ago when 44 percent were pro-regulation and 52 percent were anti-regulation.
Party identification and ideology are strong indicators of support for or opposition to government regulation of business. A robust majority of Democrats back regulation as necessary to protect the public interest (65% necessary vs. 31% more harm than good). On the opposite side of the political spectrum, Republicans stand firmly against government oversight (28% necessary vs. 69% more harm than good).
In 2014 self-identified independents were more evenly divided than the party faithful, but as a group, they were more likely to think regulation does more harm than good (43% necessary vs. 54% harmful). This year, independents mirror the general public more closely, with almost equal numbers taking each side. Forty-six percent favor government regulation of business to protect the public interest, while 48 percent are opposed.
Americans are similarly split by ideological beliefs. Liberals favor regulation (63% necessary, 34% harmful), and conservatives tend to be against government oversight (31%, 64%). True to their name, moderates are more divided but still lean strongly toward the view that regulation is necessary to protect the public interest (53%, 43%).
Race and educational attainment are also related to views about regulation. Majorities of black Americans (56% necessary, 40% harmful) and Hispanic Americans (58%, 39%) favor regulation of business, while majorities of white Americans oppose government regulation (41%, 54%). College graduates back government oversight 56 percent to 40 percent, compared with those with a high school diploma or less (45% necessary, 51% harmful).
Further, attitudes about regulation are sharply defined when explored in relation to attitudes about the federal government. Sixty-four percent of Americans with a favorable opinion of the federal government support regulation, while 65 percent of those with an unfavorable view of Washington oppose government oversight.
|Table 2: Attitudes on Regulation Related to Views on Government and Business|
|Government regulation is necessary to protect the public interest.||Government regulation usually does more harm than good.|
|People with favorable opinion of major companies||45%||51%|
|People with unfavorable opinion of major companies||52%||43%|
|People with favorable opinion of federal government||64%||31%|
|People with unfavorable opinion of federal government||30%||65%|
Government Regulation of Specific Industries
Another way to assess attitudes toward regulation is to take a closer look at industries Americans think are over-regulated and under-regulated.
According to the 2015 Pulse survey, the industries considered most under-regulated are, in order, pharmaceutical companies, banks and other financial institutions, energy companies and health insurance companies. Since last year, support for further regulating pharmaceutical firms has risen while support for further regulating health insurance firms has declined.
On the other side of the spectrum, only 25 percent say technology companies are under-regulated and only 27 percent say large retail companies and automobile companies face too few government rules. However, since last year all three sectors have experienced a drop in the percentage of Americans believing these companies are over-regulated.
It’s worth noting, however, that Americans are more likely to think these three sectors receive the right amount of government oversight than to consider them either under- or over-regulated.
The Public Affairs Pulse survey, conducted July 6–20, 2015, by Princeton Survey Research Associates International, is based on telephone interviews with 1,601 adults nationwide.