CEI Scholars Respond to Bush Budget

Analysis from CEI Vice President for Policy Clyde Wayne Crews, Jr.:

"The hidden tax of regulation is moving in lockstep with spending. While down somewhat over the past year, federal departments and agencies still managed to issue more than 4,000 new rules in 2004, with few serious proposals for serious reassessment and reduction of the regulatory state and its costs during 2005.”

REGULATORY POLICY

Aviation Security Tax: The administration’s plan for imposing new security “user fees” on airlines and their customers would worsen existing problems caused by government regulation. The administration expects to raise an extra $1.5 billion for the Department of Homeland Security to provide airport security. Fees for a one-way flight would increase by $3 to $5.50 (or to $8 for a one-way flight with multiple stops).

Analysis from CEI Technology Counsel Braden Cox:

"Under the current system, the airlines bear the brunt of consumer complaints about airport delays, even though airlines have little control over decisions concerning security procedures and air traffic control. Government agencies that set such regulatory policies—the FAA and TSA—are often the source of time delays and security gate problems that affect passengers. The security tax is not a true “user fee” because it is mandated by government agencies that are not bound by a competitive environment to spend it in the most efficient manner. Airlines and airports should be entrusted with their own security implementations."

Amtrak Subsidy Cut: The administration’s plan to eliminate most of the $1.2 billion subsidy to Amtrak is long over-due. Despite the fact that the passenger train service produced operating losses over its 34-year existence, federal subsidies only increased over the years.

Analysis from CEI Senior Fellow Iain Murray*:

"CEI welcomes the President’s decision to eliminate Amtrak’s operating subsidy and provide funds only for capital investment. Amtrak has tolerated bad business decisions for too long, assuming loss would always be paid off by federal subsidies. If Amtrak cannot balance its books, it is time for Congress to consider the long-overdue privatization of the industry."

*CEI Senior Fellow Iain Murray worked on the successful privatization of passenger rail in the United Kingdom.

Securities and Exchange Commission Budget Cut

Analysis from CEI Warren T. Brookes Fellow John Berlau:

"The budget cut for the SEC is perfectly fine; the SEC’s budget had been increased greatly in the past few years. The President and Congress should follow up by cutting the workload of the SEC, as well. That would benefit the American economy by rolling back the burdensome Sarbanes-Oxley corporate ‘reform’ legislation."

Federal Communications Commission Budget Increase The President’s budget includes $304 million for the Federal Communications Commission in fiscal year 2006. That’s an increase from $281 million appropriated for 2005, and a 24 percent increase in the FCC budget from five years ago.