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The Cost Of Regulation
The Heritage Foundation recently published a report entitled "Reining in the Regulators: How Does President Bush Measure Up?" The report compares the costs of federal regulations enacted under the current Bush Administration with regulatory costs under other administrations. The report draws several conclusions and makes several recommendations as to reducing regulatory costs. The reader is directed to the report itself for these aspects of it. Here, Winston wishes only to repeat some of the facts in the report about regulatory costs.
The Heritage Foundation report states that the Office of Management and Budget estimates that
"regulations adopted in the past 10 years cost Americans $34 billion to $38 billion annually. All federal regulations...could be costing Americans 10 times this amount: some $380 billion." (Footnotes omitted).
The report warns that the OMB estimates are
"low compared to estimates prepared by economists Mark Crain and Thomas Hopkins for the Small Business Administration. In 2000, Crain and Hopkins concluded that regulations cost Americans $843 billion (over $8,000 per household). This is almost half of the amount collected in personal income taxes that year. Put another way, the total is almost a tenth of America's gross domestic product and more than half of the manufacturing sector's output." (Footnotes omitted).
The report further cautions that even these startling
"numbers may underestimate the negative effects of regulation. For instance,
the Crain-Hopkins study does not include indirect costs. A regulation that increases energy costs would also affect other industries that require energy to produce their products."
The report also discusses other regulatory costs: e.g., deaths caused by regulatory delays in new drug approvals at FDA; and deaths in car accidents caused by reduction in car size to meet fuel efficiency standards.
The Heritage Foundation report on federal regulatory costs report is very readable despite the statistics and figures it addresses. Those statistics and figures are sobering and warrant careful consideration.
Click for Heritage Foundation report on regulatory costs.
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