America, the Burdened

Congress may be in the middle of a month-long recess, many Washingtonians may have fled the sweltering weather for friendlier climes, and the town may have slowed to a crawl, but nothing can stop the inexorable march of the nation's massive regulatory system.

 

A recent report from the Competitive Enterprise Institute reminds Americans of the tremendous toll taken by the regulatory state--some $1.6 trillion annually. Anyone running a business needs no reminder. Tentacles of the regulatory beast reach into every aspect of business operations of firms both large and small.

 

To put that number into perspective, $1.6 trillion is about equal to the amount collected in individual income taxes every year. It is more than the GDP of Poland, Norway, Austria, and Greece ... combined. And the cost and reach of regulations are expanding all the time.

 

For many years, the U.S. Chamber has led an effort to bring common sense to the rulemaking process. We believe that regulations should address legitimate problems, be based on sound science, and provide more benefit than cost. We spend a lot of time fighting burdensome and expensive regulations--we even sue the federal agencies when they have gone too far. But the bureaucrats never seem to get the message.

 

The rule-setter for the accounting industry--the Financial Accounting Standards Board--has proposed a regulation requiring a company facing a lawsuit to list on its financial statement its best-guess estimate of what that litigation could end up costing. That would not provide any useful information to investors, but it would help trial lawyers put a price on their lawsuits. It's a perfect example of a regulation in search of a problem.

 

The National Oceanic and Atmospheric Administration wants interested parties to comment on a key climate change report without releasing all the studies on which it is based. Asking the public to comment on documents it has not seen is about as far from the scientific method as one can possibly get. An effective climate change policy must be grounded in sound science.

 

The U.S. Chamber is fighting a new proposal requiring virtually all federal contractors and subcontractors to enroll in the Department of Homeland Security's E-Verify system (also known as the basic pilot program), which is intended to check the work authorization of employees. The only problem is that the system is riddled with flaws, prohibitively expensive, and unnecessarily difficult to implement.

 

When it comes to the nation's regulatory behemoth, Thomas Jefferson said it all: "The price of freedom is eternal vigilance."