President Obama’s regulatory burden crowding out growth
On Wednesday, The Heritage Foundation published a report on the President’s 2012 regulatory burdens, as well as an analysis of how much of a regulatory burden this Administration has put on the private sector. The results are not pretty. A few highlights:
• The total annual burden on the economy just from major regulations issued by President Obama in his first term is $70 billion – meaning, starting in 2013, the base burden this President has added to the already-oversized regulatory burden on the private sector of America is $70 billion.
• This will grow significantly as regulations for Obamacare and Dodd-Frank continue to be implemented.
• Agencies reported costs for only 40 percent of the major regulations they issued in 2012, meaning the actual cost of new regulations last year is much higher than the $23.5 billion analyzed by Heritage in the paper.
• Under Obama, the Environmental Protection Agency is responsible for the single largest proportion of new regulatory costs imposed on the private sector.
The report was issued by James L. Gattuso, the Senior Research Fellow in Regulatory Policy, and Diane Katz, Research Fellow in Regulatory Policy, in the Thomas Roe Institute at Heritage.
Dustin Siggins: What does this report show?
Diane Katz: Our report documents the unparalleled increase in regulation during the first term of the Obama Administration. Every regulation imposes costs, and these costs find their way into consumer prices for goods and services. This means there is an enormous new burden placed on the economy. In addition to higher prices, the regulatory burden reduces choices for consumer goods, lessens innovation, and inhibits job creation.
DS: Are there such things as “good” regulations?
DK: It depends on what problem we are trying to solve. Any problem may have a host of solutions. The question is, is government regulation the best means for solving the problem? Usually, it is not. Most of us would agree that the government has some role in protecting public health and safety. Increasingly, however, the government is regulating lifestyle, not public health and safety.
Energy efficiency standards for appliances, fuel-efficiency requirements for cars, diet restrictions, and the like are examples of this trend.
DS: You reference President Bush in the paper. How does his regulatory burden compare to the current President’s?
DK: Overregulation is not a partisan issue. Bush was no paragon of regulatory restraint, but Obama has dramatically increased the rate at which new regulations are issued. President Bush added 52 “prescriptive” regulations (regulations imposed on the private sector) in his first term. President Obama added 131.
DS: Do you have an estimate of what the total regulatory cost to America’s private sector is?
DK: No, there is no widely accepted accounting of total regulatory costs. That in itself is telling. Our report documents only new regulations. Most estimates also fail to capture the many intangible costs of regulation that in some respects are the most important. How do you price the loss of choice or the erosion of liberty?