Regulations cost Americans $840 billion per year

The U.S. Office of Management and Budget (OMB)has estimated that health, safety and environmental regulations cost up to $229 billion annually. But professors Thomas Hopkins of the Rochester Institute of Technology and Mark Crain of George Mason University say regulatory costs are more like $840 billion if economic regulations and paperwork costs are included.

U.S. Federal regulatory agencies have gathered immense legislative powers unto themselves, critics warn – powers their Constitution grants only to Congress. Legislators on Capitol Hill now have before them the "Congressional Responsibility Act" which would require congressional approval of significant agency rules. This would mean that every elected representative be on record for significantly costly regulations.

That would probably hold down costs and improve accountability. Another suggestion is to introduce an annual "regulatory report card."

  • This could include a breakdown of the number of costly rules, as well as the total number of rules produced by each agency, the top rule-making agencies, numbers of rules facing statutory or judicial deadlines, and the numbers of rules impacting small businesses and state and local governments.

  • Much regulatory data already exists, but is scattered across government agencies; 4,509 rules were at various stages in the pipeline in 2001, of which 149 cost more than $100 million – but how many policymakers knew that, observers ask.

  • It would expose where cost estimates do and don't exist and say with certainty whether the regulation would do more harm than good.

  • Agencies would concentrate on assessing and fully presenting the costs of their initiatives.

    Congress could ask the OMB and agencies to propose rules to cut each year. More formal review and establishing sunset dates for regulations to expire are also options.

    Source: Clyde Wayne Crews Jr. (Cato Institute), Regulatory Overhaul Report Card, Washington Times, June 10, 2002.

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    FMF Policy Bulletin\11 June 2002

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