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Red tape is like a teddy bear

Red tape is the unloved enemy of reason. At least, that is the orthodoxy... On the one hand, we publicly rail against it. But on the other, there are many who privately benefit from complex and excessive regulation. It supports an industry of regulatory consultants and can act as a convenient barrier to market entry…

I believe that it is neither possible nor desirable to control every risk. The law of diminishing returns suggests that the smaller a risk, the greater the cost of eradicating it. There is a point beyond which the costs to society outweigh any benefit. Regulation must control the exceptions without burdening the whole. Blanket rules represent a damaging race to the bottom...

Red tape is like an old teddy bear. We are reluctant to admit an attachment, but rather enjoy the reassurance it provides… There are real risks in giving up our teddy bear. By allowing entrepreneurs and public servants more freedom to create and innovate, we must also accept that they may make more mistakes. But the prize is a more vigorous society, a more dynamic economy and, just as important, the opportunity for greater individual fulfilment.

That was Rick Haythornthwaite, Chairman of the UK's Better Regulation Commission.

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