Wednesday, October 05, 2011

Issue Analysis Urges Reforms to Roll Back Regulation's Heavy, Hidden Tax

CEI has just released the latest in its Issue Analysis series that draws important parallels between runaway growth in federal spending and runaway growth in federal agency regulation. In "The Other National Debt Crisis: How and Why Congress Must Quatify Federal Regulation," CEI Vice President for Policy Wayne Crews takes the starting point that "[i]n order to restrain the impulse to regulate everything, Washington must measure regulation as it measures spending." This Issue Analysis provides an overview of the continuing staggering growth of federal regulations and the enormous compliance costs that those rules impose. (In an study from earlier this year, "Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State," Crews cited an estimate that 2008 regulatory compliance costs were more than $1.7 trillion). "Reforms must become a priority for the administration and Congress," writes Crews, "because no viable mechanism exists for measuring or disciplining regulation comparable to even the limited control applied to spending."

Here are some of the reforms recommended by Crews:

  • The President should extend his January 2011 Executive Order to all regulations – not just ones described as "out-dated."
  • The President should issue new executive orders lowering the threshold at which a rule qualifies as “economically significant” from $100 million in annual costs to perhaps $25 million annually in order to "increase the number of rules brought to public attention each year."
  • Congress should require that "summary regulatory data— classified by type of regulation and by agency—be published in the annual federal budget, the Economic Report of the President, a stand-alone document, or some other accessible venue."
  • Congress should establish an Office of Regulatory Analysis to examine and analyze rules in detail, similar to how Congressional Budget Office examines and analyzes fiscal and budgetary matters.
  • Congress should enact the Regulations from the Executive In Need of Scrutiny (REINS) Act or similar legislation that make Congress directly accountable for "economically significant" regulations by requiring congressional approval of new rules.

CEI is at the forefront in fighting the runaway regulatory state on both the policy and legal fronts. So it's no surprise that this latest issue analysis is a worthy read on a timely topic deserving of much more attention. Particularly, in an economy so desperate for job growth, curbing the rising tide of federal regulation is as important as putting responsible limits on out-of-control federal spending. As Crews reminds us, "[r]egulation does not control itself, and agencies will not apply the brakes. We have to do it, through our elected representatives."