The visible cost of regulation is paperwork and compliance hours. However, the hidden, far greater cost comes from lost productivity, deterred investment, and stifled innovation. The rule of thumb is that for every dollar spent on compliance, seven dollars of GDP are lost.

As insurers exit New York due to the 'Scaffold Law,' remaining carriers dictate terms. This has caused a massive spike in deductibles for contractors, from around $25,000 in the past to as high as $750,000 per occurrence today, forcing firms to self-insure a huge portion of risk.

Beyond zoning debates, the complexity and outdated requirements of building codes massively inflate construction costs. Drew Warshaw proposes a novel approach: auditing the building code itself to create a streamlined, model version that could strip 15% from project costs, making it a powerful tool for affordability.

To manage excavator blind spots, construction sites employ people to stand dangerously close and give verbal directions to the operator. This "human camera" system is a primary cause of accidents and fatalities, representing a significant, unaddressed safety and efficiency problem.

Insurers like Zurich now require AI-powered cameras on NYC job sites. The AI analyzes daily footage to identify dangerous movements and near-misses, not for live surveillance, but to provide data for correcting worker behavior, improving safety protocols, and reducing future incidents.

Construction projects have limited upside (e.g., 10-15% under budget) but massive downside (100-300%+ over budget). This skewed risk profile rationally incentivizes builders to stick with predictable, traditional methods rather than adopt new technologies that could lead to catastrophic overruns.

New York's absolute liability standard holds contractors 100% at fault for height-related injuries, regardless of worker negligence. This drives insurance to 10% of project costs, compared to just 2% elsewhere, as insurers flee the state or charge exorbitant premiums.

Without clear government standards for AI safety, there is no "safe harbor" from lawsuits. This makes it likely courts will apply strict liability, where a company is at fault even if not negligent. This legal uncertainty makes risk unquantifiable for insurers, forcing them to exit the market.

The term 'Scaffold Law' is misleading. It's an absolute liability law for any height-related injury. A worker falling six inches from a secured ladder in a trench can trigger a claim where the contractor is 100% liable, drastically expanding its scope beyond high-rise work.