If Only Senator Hawley Could Legislate Away Unintended Consequences

Scott LincicomeSeeking to prove theold adage about roads and good intentions, Missouri Senator Josh Hawley has recently introduced legislation,The Slave ‐​Free Business Certification Act of 2020, that would impose steep fines and other penalties on large companies doing business in the United States, unless they regularly audited their global supply chains and certified that theyand their suppliers did not utilize “forced labor.” The bill’s presumed intent is to discourage slave labor around the world – a goal that ’s both laudable and, given troubling reports out of China and elsewhere, still quite important. Unfortunately, good intentions don’tusuallynecessarily make good policy, and in this case recent history shows how Hawley ’s bill would likely make thingsworse, not better, for the world ’s most vulnerable people.The Mercatus Center ’s Tyler Cowen helpfully summarized the bill’s theoretical flaws in a recentBloomberg column, noting that the onerous supply chain regulations would most likely cause companies – worried about high compliance costs, bad publicity, and scary penalties – simply to move their supply chains “from the poorest and neediest” countries to wealthier places clearly free of “forced labor” (which, as Cowen helpfullyadds, the Hawley bill defines more broadly than slavery). Sadly, forced labor remains somewhat common around the world, but an exodus of multinational capital and business practices from these pla...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs