February 21, 2017

Regulation and Anti-Regulation

[Hi, Freedom to Tinker readers. I’m back at Princeton, having completed my tour of duty as Deputy U.S. CTO, so I can resume writing here. I’ll start with some posts on specific topics, like the one below. As time goes on, I’ll have a lot more to say about what I learned.  –Ed Felten]

Politicians often talk about regulation as hindering business and economic development. Witness President Trump’s executive order  that tries to reduce the number of Federal regulations. Sometimes regulation inhibits innovation and limits freedom of action. But often regulation acts to open up new opportunities.

A good example is the FAA’s “Part 107” rule that was announced last summer. This rule established requirements for commercial flights of drones up to 55 pounds. For the first time, commercial flights became possible without requiring special permission from the FAA, as long as certain restrictions were followed: fly below 400 feet; avoid airports and other special facilities; don’t fly at night; don’t fly over people; and maintain visual line of sight to the drone.

Because flying aircraft in the national airspace is forbidden by default, for obvious safety reasons, regulation that permits flight, within limits, has the effect of expanding rather than reducing what companies and individuals can do. Part 107 made more types of drone flights legal.  This has already been an important enabler of beneficial innovation and use of drones.

But the FAA’s work is not done. The agency had been planning a series of follow-on rules designed to relax the boundaries of Part 107, to allow flight over people, beyond visual line of sight, and so on, as it became clear how to do so safely.  

Will the new executive order make this more difficult?  It’s hard to tell, because many aspects of the order are unclear or await further clarification from the Office of Management and Budget.  But a policy that creates new barriers to the FAA responsibly loosening the restrictions on drone flights will not increase freedom and will not benefit the American people.

I hope the interpretation and implementation of the new executive order accounts for the full range of regulatory actions.  A policy that starts out assuming that regulation limits action too much, and thereby inhibits innovation and economic growth, may or may not be correct. But a policy that tries to prevent all action by regulatory agencies cannot be the right approach for the American people, especially if the goal is to reduce the burden imposed by regulation.



  1. Sami Liedes says:

    This is semantic nitpicking, but I don’t think flying aircraft is forbidden “by default”, but because there’s a regulation generally forbidding flying aircraft unless one of various exceptions apply. Since the basic state is generally permissive, I think it makes most sense to say that regulations only subtract from the set of allowed things; if an exception is carved out for drones (or airlines, military, whatever), it makes the set of allowed things larger and therefore in fact deregulates something.

    So, for example, if moving your fingers is permitted in general, but specifically forbidden in a way which would trigger a weapon to shoot another people, except in certain cases of self-defence, I think the most formally sensible way to think is that the law forbids shooting people except in self defence, which means it forbids a slightly smaller set of behaviors than shooting people.

    • Fair enough. But still, Part 107, despite being a new regulatory rule, serves to expand the scope of actions allowed by law and regulation.

  2. I stopped doing anything with drones last year because this passed. Now if I don’t register and put some ID on my “toy” drones in just the right way, some FAA bureaucrat will fine me thousands of dollars and try to imprison me. (See the IRS, BLM, or EPA here out west).

    How about making people liable for their results of bad behavior instead of trying to make rules that try to fit both in the urban canyons of New York, and here out west where there might not be another person for 20 miles in any direction?

    How about anything under 55 pounds you can fly wherever you want in non-urban areas (away from airports or such) if you don’t do anything stupid without registering?

    I’d rather have the right to fly my drone wherever I have permission rather than have the privilege of flying a drone wherever you happen to think it might be okay with lots of paperwork, picayune rules, and threats of massive fines and criminal prosecution – not if I actually hurt anyone but my ID number is a millimeter too small.

    If the Computer industry was so regulated, we’d still be using FORTRAN and COBOL. Or if Crypto wasn’t completely deregulated, we’d still be using 40 bits and the bitcoin farms would be cracking bank SSL transactions.

    Why are you scared of ZERO regulation, and simply enforcing torts and property rights (attain around airports), and leaving it to the common sense of yourself, myself and anyone else instead of relying on the “common sense” of some regulator who might have never even built or flown a drone and doesn’t know which side of a soldering iron to hold?

  3. > How about making people liable for their results of bad behavior instead of trying to make rules that try to fit both in the urban canyons of New York, and here out west where there might not be another person for 20 miles in any direction?

    I’ll bite (and hypothesize).

    How specifically do we make people liable for their bad behavior? How about an insurance requirement. Let’s say that, because there *are* idiots out there that will fly drones near airports etc, the liability coverage should be enough for a severely damaged commercial turbofan. Or the lives of the passengers riding in the airframe it is (or was, if the ingested drone messes it up *just* the right way) attached to.

    Of course, since you’re not one of them, you should be able to access the insurance market, convince the insurance company that you only fly where “there might not be another person for 20 miles in any direction”, and get a non-crazy premium. Right?

    Oh and let’s see what kind of surveillance requirements (with data sharing/brokering as the gravy) the Holy Private Insurance Market puts on your drone in that case. May I at this point also draw your attention to the developing “we’ll track your driving for lower premiums” trend that’s been developing in the auto insurance market.

    There, no/minimal regulation and all’s great!

    Of course this is all hypothetical, you could even say strawman. The problem with the “we don’t need no regulations” dogma is that the alternatives are either significantly higher transaction costs (enjoy negotiating with insurance companies when they insist tracking your drone flights more than the FAA would) or cost/risk externality (your drone is sucked into a 737 engine, your bankruptcy following lawsuits somehow fails to bring anyone back from the dead).

    And thus, often, regulations *enhance* innovation.

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