It is amazing that the public tolerates a Congress that is so adversarial to their interest. But it’s not so surprising when you consider that the majority of citizens are misinformed or uninformed.
So, it is time for industry leaders to take the lead. Let’s look at federal regulations and how much they cost U.S. citizens. Two university studies have estimated that 290,000 federal employees made or administered these rules in 2013, which is up from 57,109 in 1960, 146,139 in 1980 and 270,872 in 2000. This cost taxpayers $50.46 billion in 2013, a 76% increase (adjusted for inflation) in the past 13 years. Meanwhile, industry regulatory costs grew 7.6% annually over the last 15 years when industrial growth only mustered 0.4% annually over that same period. Since 1981, industrial regulations have grown to 2,302 in number, or 1.5 new regulations every week for the past 30 years.
Are these regulations worth the cost? This is an important question. But before looking at costs, let’s briefly acknowledge a General Accounting Office (GAO) report stating that 35% of “major” (costing $100 million or more annually) and 44% of “other” regulations were issued without public comment between 2003 and 2013. The Obama Administration has issued 2,605 regulations during its first term (2008-2012). The plurality of the major rules issued had no public review. In addition, studies by some agencies do not support the claimed savings and are therefore not validated. For example, the EPA does not acknowledge air quality standards – put into effect as Department of Transportation (National Highway Transportation Safety Administration) fuel economy standards – as a costly requirement. These regulations are projected to cost $10.8 billion annually, or $1,800 per new vehicle. The EPA and NHTSA concluded that consumers do not know what is in their own best interest.Multiple agencies failed during 2012 to provide quantified cost analyses for 10 of 25 major regulations issued. As another example, the U.S. Court of Appeals for the District of Columbia castigated the Securities and Exchange Commission’s (SEC) cost analysis on information dissemination by investment firms as “inconsistently and opportunistically framed.”
According to the Chamber of Commerce, “the average regulatory cost for each employee of small business exceeds $10,000 per year.” It adds, “businesses with fewer than 20 employees incur regulatory costs 42% higher than larger (500+) firms.”
Are these costs worth it and justified by those paying the bill – the business and individual taxpayers? Various studies have concluded that there is a lack of transparency and honesty by agency regulators regarding disclosure and bias toward regulation imposition. Both Chamber of Commerce and Heritage Foundation studies suggest: requiring Congressional approval of new major regulation issuance; developing a Congressional regulatory analysis capability; establishing a sunset date for all federal regulations; and subjecting “independent” agencies to external review of proposed issuances.
It is strongly recommended that readers visit the Congressional website (www.thomas.gov) and review H.R. 367 and S. 15. These are two versions of the REINS (Regulations from the Executive in Need of Scrutiny) Act. The first, with 164 co-sponsors, passed the House on Sept. 9, 2013, but received no Senate attention or action. The second bill, introduced by Senator Rand Paul with 24 co-sponsors, was referred to committee with no attention or action from Majority Leader Harry Reid. House Report 113-160 discusses the content and rationale on the need for this REINS law. This report provides insight into: excessive costs of regulation on industry with stifling of job creation and national economic growth; bias shown by agencies claiming regulation net benefits at 25 times more than costs; and claims, such as by the Bureau of Labor Statistics, that poor employment is due to business practices and unrelated to regulations.
Common sense screams that government is not being honest and does not deserve public trust when it comes to defining and imposing federal regulations. What readers need to understand and take action on is this matter of coercing Senate action on items that affect them and their businesses. The Senate’s stonewall refusal to discuss this matter of critical importance to U.S. taxpayers and industry cannot go uncontested. The life of every reader’s company is at risk without attention. Call your two Senators and instruct them to do their job. IH