According to the US Chamber of Commerce Foundation, federal regulations cost the US economy approximately $1.9 trillion every year in “direct costs, lost productivity, and higher prices.” In 2016, one of the issues that then-Republican presidential candidate Donald Trump ran on was reducing burdensome red tape on businesses. While in office, Trump ordered the government to eliminate two regulations for every new one a federal agency created.
Under President Joe Biden, heavy constraints made a comeback in his first year in office. That’s despite federal judges ruling he didn’t have the legislative authority to create many of the rules. On March 21, the Securities and Exchange Commission (SEC) announced a new proposal requiring businesses to report their carbon footprint to the agency. Some say America’s farmers are now under siege by the SEC.
Are America’s Farmers Under Siege by the Government?
The SEC is proposing new rules referred to as the “Enhanced and Standardization of Climate-Related Disclosures for Investors.” If finalized, new federal regulations would require publicly-traded companies to report their greenhouse-gas emissions and any risks the business could face due to climate change.
That’s not all; the SEC proposal also requires large businesses to report on the estimated emissions of their suppliers and consumers. Farm groups say the rule would disproportionately harm small private farmers, resulting in increased food costs. The government would correspondingly force them to assign unreasonable resources and time to track the data.
Some say the government could end up prohibiting farmers from working with public companies as they don’t have the financial means to fall into compliance the way larger companies do.
Bipartisan House Members Forward Letter to the SEC
Over 100 bipartisan members of the House sent a letter to SEC Chairman Gary Gensler. They stated he exercised authority Congress did not grant him and warned the impending regulation would significantly harm US farmers. The lawmakers warned the added red tape would be nearly impossible for many public companies to comply with the rule.
In addition, the bipartisan group said the proposed rule wouldn’t be used to help capital markets flourish but to “smear” businesses. They accused the SEC of wrapping climate activism with financial regulations, which they said would make the energy crisis in America worse. Additionally, the lawmakers noted the SEC was stepping out of line with its mission by engaging in environmental policy and said it was Congress’ responsibility to set climate policy, not a federal agency.