With Debt, Deficits Comes More Red Tape

The Washington Examiner highlights Wayne Crews's study on the size of the federal regulatory state. 

But debt and deficits aren't the only monstrously growing manifestations of out-of-control government in the nation's capital. When government spends tax dollars, a flood of rules and regulations invariably follows. Some of the red tape is meant to prevent waste, fraud and abuse. But far more of it is a damaging burden on the individual liberty and free enterprise that have made this country the most prosperous in human history. The recently issued 2010 edition of the Competitive Enterprise Institute's "Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State" provides some chilling insights into just how burdensome federal bureaucracy has become.

Regulatory compliance costs imposed on businesses last year exceeded $1.87 trillion, or an amount equal to 8.3 percent of the gross national product, according to the CEI report. Such costs are only going to grow. Washington issued 3,508 new regulations in 2009. More than one-tenth of the new regulations issued in 2007 each resulted in at least $100 million in compliance costs. All of us pay for these regulatory costs because businesses pass their costs on to consumers in the form of higher prices.

But as CEI notes, there are other, more hidden costs of regulations: "Since disclosure and accountability for regulation are limited, policymakers have little incentive to care about the extent of regulatory costs or where those costs stand in relation to ordinary government spending." And since regulatory compliance costs appear nowhere as a line item in the federal budget, they escape the kind of public and media attention normally devoted to direct government spending. As CEI notes, the result is regulatory compliance costs become a form "off-budget taxation."

Read the full article at the Washington Examiner.