IBD: Federal Regulations Cost Trillions


Federal Regulations Now Cost Almost $1.9 Trillion, Study Finds



 for Investor’s Business Daily
9:51 AM ET

Do we live in a democracy, or a regulatory dictatorship? It’s hard to tell sometimes, especially after reading the latest annual report on the regulatory state issued by the Competitive Enterprise Institute.

CEI’s latest “10,000 Commandments” adds up the total cost of federal rules and regulations, and should be required reading for anyone espousing still more government control over the economy. What it shows is that the country is increasingly being ruled not by elected representatives, but by unelected and largely unaccountable bureaucrats in Washington.

Just look at the balance between regulations and laws. For every bill passed through Congress and signed by the president last year, regulators imposed 30 new regulations.

And at $1.885 trillion, the cost of regulations now exceeds the cost of federal individual and corporate income taxes, which raised about $1.82 trillion last year.

The CEI report shows that economic regulations (such as market entry restrictions, price supports and the like) impose the biggest costs at $399 billion. That’s followed by environmental regulations at $386 billion, and — incredibly — the cost of complying with the tax code, which is expected to be $316 billion this year.

The problem is that these costs never show up in any federal budget as a cost of government. They just get hidden in higher prices, lower take home pay, more unemployment, less opportunity.

As a result, as author Clyde Wayne Crews explains: “Regulatory initiatives can enable federal commandeering of private sector resources with comparatively little public fuss, rendering regulation a form of off-budget taxation. Policymakers find it easier to impose regulatory costs than to embark on more government spending because of the former’s lack of disclosure and accountability for costs. Furthermore, where regulatory compliance costs prove burdensome, Congress can escape accountability by blaming an agency for issuing an unpopular rule.”

The impact on growth, however, can be profound. A separate report from the Mercatus Center at George Mason University found that the nation’s GDP would be 25% bigger today if no new federal rules had been issued since 1980.

President Obama recently claimed that it’s a “myth” that deregulation would spark economic growth. In fact, it’s an easily checkable truth.

Presidents Reagan and Clinton both deregulated big chunks of the economy and the growth flourished. Obama has imposed more expensive, and more intrusive, regulations — ObamaCare and Dodd-Frank are just two — than just about any president before him, and has produced the worst economic recovery since the Great Depression.

And while the last recession has been commonly blamed on deregulation under President Bush, he was hardly a deregulator. In fact, Bush imposed regulations at an average rate of 62 major rules a year, compared with 81 a year under Obama.

A return to freedom, growth and opportunity will require Washington to rein in the runaway regulatory state.

You can read the CEI report here.

See more: http://www.investors.com/politics/capital-hill/federal-regulations-now-cost-almost-1-9-trillion-study-finds/