Commentary

Regulatory costs dwarf deficit

The NCPA crew tagged some interesting stuff on regulatory costs: An article from the Heartland Institute points out that in 2003, federal government agencies issued a remarkable 4,148 new rules, which are listed in the 71,269-page Federal Register, thought that is down from 75,606 pages in 2002. The latest Regulatory Right-to-Know report from the Office of Management and Budget finds that total regulatory costs reached about $869 billion in 2002, more than twice the federal budget deficit, and more than Canada’s entire gross domestic product. Tack on the $30.8 billion regulatory agencies spent to administer regulations, and the total reaches $899.8 billion. Regulation expert Clyde Wayne Crews argues in the Heartland article that regulations should be treated as federal spending. I agree but think we need more. We already require agencies compare costs and benefits of regulations (a process that needs improvement), but any reg with net benefits is allowed, basically. Instead, we ought to have a regulatory budget, a limit on the costs that can be imposed, so that agencies have to prioritize regulations and chose those that give the most bang for the buck.