Forbes covers Regulatory Dark Matter.
The economic burden of America’s accumulating mountain of regulatory requirements is almost unimaginable: According to a study from the Mercatus Center at George Mason University that used a 22-industry dataset covering the years from 1977 through 2012, by distorting the investment choices that lead to innovation. That translates to a U.S. economy that is a whopping $4 trillion smaller than it otherwise would have been.
There are numerous reasons for this. For a start, as regulations become more and more complex and burdensome, prospective entrepreneurs and managers must expend more resources on issues related to regulation and have less for innovation and corporate growth.
Regulation is more than actual regulations, however. In addition to the formal rulemaking that proceeds according to the requirements of the Administrative Procedures Act (APA)–which includes public notice for proposed rulemaking, the opportunity for public input and comment before a final rule is published in the Federal Register–the federal regulatory colossus uses other less formal instruments and procedures.
Clyde Wayne Crews of the Competitive Enterprise Institute has dubbed such government actions “regulatory dark matter,” because they resemble the difficult to detect and virtually invisible “dark matter” of the universe. Those government actions include “interpretative rules, general statements of policy, or rules of agency organization, procedure or practice,” and “the thousands of executive branch and federal agency proclamations and issuances, including guidance documents, memoranda, bulletins, circulars, and letters that carry practical (if not always technically legally) binding regulatory effect.”
And as the federal alphabet-soup churns these out in huge numbers, in Crews’s words, even “without Congress actually passing a law or an APA-compliant legislative rule or regulation being issued, the federal government increasingly injects itself into our states, our communities, and our personal lives.” In his lengthy 2015 report on the topic, he focuses on the impact of executive orders, agency guidance documents and regulatory notices.
Read the full story at Forbes.