Category Archives: US Manufacturing Companies

The preceding posting “Federal Regulations And Intervention Cost America Consumers And Businesses $1.9 Trillion In 2016, discussed the scope and effect regulations have on the economy.  This posting will look at some solutions.

From the CEI posting titled “Ten Thousand Commandments 2017” comes the following excerpts:

A regulatory liberalization agenda would provide genuine economic stimulus and offer some confidence and certainty for businesses and entrepreneurs.

Steps to Improve Regulatory Disclosure

Certainly, some regulations’ benefits exceed costs, but net benefits or even actual costs are known for very few. Without more complete regulatory accounting, it is difficult to know whether society wins or loses as a result of rules.

An incremental but important step toward greater openness would be for Congress to require— or for the Office of Management and Budget to initiate—publication of a summary of available but scattered data.

Regulations fall into two broad classes: (a) those that are economically significant (costing more than $100 million annually) and (b) those that are not. Agencies typically emphasize reporting of economically significant or major rules, which OMB also tends to emphasize in its annual assessments of the regulatory state. A problem with this approach is that many rules that technically come in below that threshold can still be very significant in the real-world sense of the term.

Ending Regulation without Representation: The Unconstitutionality Index—27 Rules for Every Law

Agencies do not answer to voters. Yet in a sense, regulators and the administration, rather than Congress, do the bulk of U.S. lawmaking. But agencies are not the only culprits. For too long, Congress has shirked its constitutional duty to make the tough calls. Instead, it delegates substantial lawmaking power to agencies and then fails to ensure that they deliver benefits that exceed costs.

Agencies face significant incentives to expand their turf by regulating even without demonstrated need. The primary measure of an agency’s productivity—other than growth in its budget and number of employees—is the body of regulation it produces. One need not deplete too much time and energy blaming agencies for carrying out the very regulating they were set up to do in the first place.

For perspective, consider that in calendar year 2016 regulatory agencies issued 3,853 final rules, whereas the 114th Congress passed and President Obama signed into law a comparatively few 214 bills. Thus, there were 18 rules for every law in 2016 (see Figure 24). The ratio can vary widely, but the average over the decade has been 27 rules for every law. Rules issued by agencies are not usually substantively related to the current year’s laws; typically, agencies administer earlier legislation. Still, this perspective is a useful way of depicting flows and relative workloads.

Regulatory reforms that rely on agencies policing themselves will not rein in the regulatory state or fully address regulation without representation. Rather, making Congress directly answerable to voters for the costs that agencies impose on the public would best promote accountable regulation. Congress should vote on agencies’ final rules before such rules become binding on the public.

Well, why don’t they vote on agency final rules?

Concern about mounting national debt incentivizes Congress to regulate rather than to increase government spending to accomplish policy ends.

By regulating instead of spending, government can expand almost indefinitely without explicitly taxing anybody one extra penny.

This creates unfunded liabilities. Leaving the people regulated to fund the regulation. Congress could pass a law intending to reduce homicides in the US by requiring an increase of police officers per square mile of city area to match New York’s successful program of 119 officers per square mile.. This would require, for example, a doubling of Chicago’s police force according to a posting by Politics & City Life titled “City Size and Police Presence.” This might be a great idea, but either fund it or let the people in Chicago decide if they want to double the police force.

Affirmation of new major regulations would ensure that Congress bears direct responsibility for every dollar of new regulatory costs. The Regulations from the Executive in Need of Scrutiny Act (REINS) Act (H.R. 26, S. 21), sponsored by Rep. Doug Collins (R-Ga.) and Sen. Rand Paul (R-Ky.), offers one such approach. It would require Congress to vote on all economically significant agency regulations—those with estimated annual costs of $100 million or more. It has passed the House in the current and three previous congressional sessions but has not moved forward in the Senate.

Congressional rather than agency approval of regulations and regulatory costs should be the goal of reform. When Congress ensures transparency and disclosure and finally assumes responsibility for the growth of the regulatory state, the resulting system will be one that is fairer and more accountable to voters.

Please read the entire CEI report by clicking here.

cbdakota