How Predictable Are Laws? - by Brian Potter

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How Predictable Are Laws?<br>Brian Potter<br>Jul 16, 2026

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An enormous amount of ink has been spilled (some of it by me) on the trials and tribulations of complying with the National Environmental Policy Act, better known as NEPA. NEPA is what requires projects to perform years-long, thousand-plus page environmental impact studies before construction can begin, and suing a project for an insufficiently detailed environmental study is one of the chief ways environmental groups are able to slow down or stop projects they don’t like. And NEPA’s influence goes beyond federally funded projects: NEPA also influenced the creation of many similar laws, both at the state level (such as California’s CEQA) and in countries around the world.<br>None of these effects of NEPA, however, were envisioned when the law was written. NEPA was seen primarily as an (aspirational) statement of US environmental policy, which was to “encourage productive and enjoyable harmony between man and his environment, to promote efforts which will prevent or eliminate damage to the environment and biosphere and stimulate the health and welfare of man; [and] to enrich the understanding of the ecological systems and natural resources important to the Nation.” The provision that requires environmental impact statements was added last minute as a way to try to give some teeth to these high-minded but somewhat abstract ideals, and received virtually no attention at the time. As Alec Stapp and I noted:<br>[The provision] was not covered in any major media publication. In Congress, it received “neither debate, nor opposition, nor affirmative endorsement.” Caldwell would later state that “most [members] had never really understood the bill and only agreed to it because it was from Jackson; it was about the environment which was a very ‘hot’ issue at the time; and it was almost Christmas and they wanted to get home.”<br>Not until several months after NEPA was passed did environmental groups realize what a potent weapon they’d been handed.

It’s not hard to find other examples of laws whose effect was far different than what the authors anticipated. The 401(k) retirement account, now used by tens of millions of Americans as the primary vehicle for retirement savings, was originally considered an insignificant provision of the 1978 Revenue Act. Per a Bloomberg piece about the Act:<br>…The initial provision was estimated to have a “negligible effect upon budget receipts.” Now, defined contribution plans are the fifth-biggest tax break for individuals, with an estimated revenue loss to the government of $61.4 billion in fiscal 2014.<br>“There was absolutely no discussion in ’78 that if you do this, the world is going to change,” said Daniel Halperin, then a senior Treasury official and now a Harvard Law School professor.<br>The tale of Richard Stanger [a primary author of the Act], who said he hadn’t been interviewed previously about his role, is also a story about accidental actors at historic moments. As Stanger himself says, if anyone had known how important 401(k) would become, the Joint Committee on Taxation never would have let him, a 28-year-old junior lawyer, write it.

In the other direction, laws aimed at stimulating the construction of housing in California have proven much less effective than predicted:<br>One California law was supposed to flip defunct strip malls across California into apartment-lined corridors. Another was designed to turn under-used church parking lots into fonts of new affordable housing. A third would, according to supporters and opponents alike, “end single-family zoning as we know it.”<br>Fast-forward to 2025 and this spate of recent California laws, and others like it intended to supercharge the construction of desperately needed housing, have had “limited to no impact on the state’s housing supply.”<br>That damning conclusion comes from a surprising source: A new report by YIMBY Law, a pro-development nonprofit that would very much like to see these laws work.

I wanted to better understand how common this was: how often do laws do more or less what they’re designed to do? How often do their effects diverge widely, either by having unanticipated effects or by failing to do what the authors predicted? So I used AI to analyze the effects of several hundred federal laws passed over the last 50 years.<br>Overall, I found that federal laws mostly do what they’re expected to do. But a substantial fraction of them — around 11% — diverge significantly, having either much smaller or much larger effects than originally predicted.<br>Method

To do this analysis, I first chose five random federal laws passed each year from 1976 to 2023, filtering out any laws that were less than 10 pages in length, which were mostly insignificant things like post office renamings. This yielded 240 laws total, but for one law the AI was unable to find any information, so the actual analysis was done on 239 laws....