WASHINGTON (June 20, 2017) – With an economic relationship that is already the most extensive and successful in the modern world, the United States and Canada should do more to improve regulatory harmonization between the two countries and reduce what are unnecessary and counterproductive regulatory differences, according to a new R Street Institute policy study by Associate Fellow Sean Speer.

“It is essential that the two countries continue to work together, particularly on issues of mutual interest like border security, energy and climate change,” writes Speer. “Superfluous policy differences have imposed undue economic costs with little benefit to improved health and safety or to consumer protection.”

As Speer notes, some of these differences reflect deeply held political views or unique domestic conditions, but too many others are driven by complacency and inertia by politicians, officials and businesses. The resultant information, adjustment and conformity costs are borne by entrepreneurs, investors and workers.

Speer identifies four specific institutional changes that should be adopted in order to ensure more meaningful progress: full adoption of “mutual recognition” to expedite regulatory convergence; a basic commitment by both governments that all new or amended federal regulations meet a convergence test; establishment of a joint review process; and incorporation of regulatory convergence into the incentives inherent in the regulatory budgeting model.

“The Trump administration, with a unified Republican Congress, now has the opportunity to enact a proverbial ‘win-win’ entirely consistent with a conservative message that focuses on bolstering economic growth and job creation,” writes Speer.

R Street is a nonprofit, nonpartisan public policy research organization whose mission is to promote free markets and limited, effective government. It has headquarters in Washington, D.C. and five regional offices across the country. Its website is www.rstreet.org.

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