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The Regulatory State Gone Wild

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According to a new Heritage Foundation report, “Red Tape Rising: Obama-Era Regulation at the Three-Year Mark,” during the first three years of the Obama administration “a total of 106 new major regulations have been imposed at a cost of more than $46 billion annually, and nearly $11 billion in one-time implementation costs.”

All told, some 10,215 new federal regulations or “rulemaking proceedings” have been issued during the first three years of the Obama administration. Although this is only slightly less than the 10,674 approved during the first three years of the Bush administration, it is enough of a difference that Barack Obama could say in his last State of the Union Address, “I’ve approved fewer regulations in the first three years of my presidency than my Republican predecessor did in his.” George W. Bush did have more regulations, but because they cost the economy “only” $8.1 billion annually, he doesn’t look as bad as Obama. (I would argue that he is actually worse, because it is Bush and the Republicans who talked about fewer regulations and limited government while simultaneously increasing regulations and expanding the size and scope of government.)

According to the Heritage Foundation report, during 2011 alone, the Obama administration

completed a total of 3,611 rulemaking proceedings, according to the Federal Rules Database maintained by the Government Accountability Office (GAO), of which 79 were classified as “major,” meaning that each had an expected economic impact of at least $100 million per year. Of those, 32 increased regulatory burdens (defined as imposing new limits or mandates on private-sector activity). Just five major actions decreased regulatory burdens. The remainder of the rules adopted were non-regulatory in nature, such as those setting spending criteria for government programs.

The 32 regulations that increased regulatory burdens covered everything under the sun: energy standards for appliances, testing and labeling requirements for toys, limits on “greenhouse gas” emissions, employer requirements for posting federal labor rules, more-explicit warnings on cigarette packages, and expanded employment requirements for the disabled. The largest number of regulations are from the 2010 Dodd-Frank financial-regulation statute. The most expensive regulations were those imposed by the Environmental Protection Agency (EPA).

The Federal Register, where all new federal regulations must be published, has grown from 68,598 pages in 2009 to 82,415 in 2011.

But not all regulations can be blamed on the White House. Some are necessitated by ambiguous statutory language. Others are mandated by Congress. Many are promulgated by independent government agencies with very little or no congressional oversight.

Conservatives are correct in pointing out that government regulations stifle entrepreneurship, eliminate jobs, increase red tape, hinder job growth, hamper innovation, create an uncertain business environment, burden the economy, harm small businesses, result in higher prices for consumers, limit consumer choice, and drive U.S. companies overseas.

Even the president would agree with most of those claims. In his State of the Union Address, he acknowledged that “there’s no question that some regulations are outdated, unnecessary, or too costly.” He also proposed tearing down “regulations that prevent aspiring entrepreneurs from getting the financing to grow.”

The true cost of government regulations cannot be calculated. As the Heritage Foundation report says, “The agencies that perform the analyses have a natural incentive to minimize or obfuscate the costs of their own regulations.” The EPA especially is singled out for being notorious when it comes to understating regulation costs.

Republican plans to reform, make fairer, make less onerous, standardize, streamline, or rationalize government regulations suffer from two fatal flaws. And likewise for the conservative Heritage Foundation’s three recommendations (requiring congressional approval of new major regulations promulgated by agencies, establishing a Congressional Office of Regulatory Analysis, and establishing a sunset date for federal regulations).

Since when is the federal government authorized under the Constitution to issue the overwhelming majority of its regulations in the first place? Republicans and conservatives say they revere the Constitution, yet they rarely if ever draw attention to the absence of constitutional authority for the federal government to issue most regulations in the first place.

And since when is it a legitimate function of the federal government to issue such regulations? The only legitimate purpose of government is to protect the life, liberty, and property of its citizens from the violence or fraud of others. The principles of limited government and federalism that Republicans and conservatives say they hold dear are thrown out the window when it comes to the federal regulatory state.

In the preview to the new Republican budget recently issued by House Budget Committee Chairman Paul Ryan, the call is made for “reasonable and predictable regulations.” How is that any different from Obama’s proposal in his State of the Union Address that “we need smart regulations to prevent irresponsible behavior”?

In the end, it is Republican or Democratic government bureaucrats who will decide what regulations are “reasonable” or “smart,” instead of the Constitution and the principles of limited government and federalism.

The whole issue of government regulations is really not that difficult. Consider the cases of three new federal regulations relating to swimming pools, airline tickets, and housing

American hotel operators say President Obama’s Justice Department is socking them with an “overly burdensome” interpretation of the Americans With Disabilities Act (ADA), by requiring hotels and other lodgings to make swimming pools and spas handicap-accessible.

The U.S. Department of Transportation imposed new regulations on airlines Jan. 24 that were supposed to benefit consumers. The rules require all government taxes and fees to be included in advertised fares and allow passengers to withhold payment for 24 hours after making a reservation, if it’s one week before the flight’s departure.

New federal regulations are designed to protect the gay, lesbian, bisexual and transgender community from housing discrimination. The U.S. Department of Housing and Urban Development is offering protections similar to the race and religion protections in the Fair Housing Act in federally funded housing projects or federally backed mortgages.

The federal government is not authorized, by the Constitution or otherwise, to regulate swimming pools or hotels or to pass legislation that mandates how businesses treat the handicapped.

 

The federal government is not authorized, by the Constitution or otherwise, to regulate airline tickets, airlines, advertising, or payment procedures.

The federal government is not authorized, by the Constitution or otherwise, to regulate housing, to pass anti-discrimination legislation, or even to have a Department of Housing and Urban Development.

It’s that simple. None of those regulations should exist. And it doesn’t matter whether they are “reasonable” or “smart.”

A regulatory state always leads to an army of bureaucrats and regulators, then to a nanny state to micro-manage the behavior of its citizens, and then to a police state to enforce the regulations. The regulatory state should be rejected, root and branch, as inimical to a free society.

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