'Hidden Tax': Govt Rules Cost Economy Nearly $2 Trillion

Newsmax ^ | 19 Apr 2011 | Mike Tighe

[Qbert]

Even as politicians and pundits debate taxes and spending — and spar over the difference between debt and deficit — an economic bogeyman lurks in the closet: government regulations that cost the economy nearly $2 trillion a year.

That staggering figure comes courtesy of Wayne Crews, policy vice president at the Competitive Enterprise Institute, who scrutinized the 81,405 pages of the Federal Registry. That catalog chronicles the nation’s regulations on businesses and state and local governments.

Crews' report, titled Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State, contends that government regulations cost the economy $1.75 trillion in 2008.

Amid all the debates about the nation's economy, hardly anyone pays attention to the cost of the rules, which Crews describes as the "hidden tax." After all, such costs don't end up on people's pay stubs or tax bills from state and local governments.

Crews' report notes: “Because such regulatory costs are not budgeted and lack the formal public disclosure of federal spending, they may generate comparatively little public outcry."

That off-the-radar aspect of regulations makes them an inviting way for governments to raise Money, Crews contends.

“If regulatory costs remain largely hidden from public view, regulating will become increasingly attractive compared with increasingly unpopular taxing and spending,” Crews writes. “Rather than pay directly and book expenses for new initiatives, the federal government can require the private sector — as well as state and local governments — to pay for federal initiatives through compliance costs.”

Although Crews' report acknowledges that getting a precise tally of government regulation is impossible, he stresses that every new rule costs business owners and consumers more money.

The Daily Caller lists just some of the report's significant points, including the following:

[Free Vulcan]

This is one of my points I like to harp on. It’s not enough to eliminate budget deficits. Reigning in regulatory agencies and restructuring regulatory law won’t do much to fix the budget deficit because they are a fraction of where the money goes. It will however free business up to be competitive again and improve the job climate while improving the tax base at the same time.

[Qbert]

Good points. And as the tax base improves of course, it will bring in more revenues (which assuming there isn’t an increase in spending) would then help reduce deficits.

[screaminsunshine]

Finally a mention of my main issue. Liberate the economy...not Libya.

[Matchett-PI]

bttt