In 2012, Cass Sunstein, Obama’s former Office of Information and Regulatory Affairs administrator touted another executive order intended to “eliminate unjustified regulatory costs and to reduce burdens” through international regulatory coordination.
Here’s what that looks like in practice: Last year, Sunstein’s office wiped $2.5 billion in regulations from agency books. And the administration added $236 billion in new regulations.
Interestingly, small companies, as a percentage of market capitalization, reported higher regulatory costs than their larger competitors. For example, regulatory costs consumed 6.7 percent of Honeywell’s market cap ($50 billion), compared to just 1.6 percent for General Electric ($221 billion), even though GE reported higher regulatory spending. The same was true for energy, where ExxonMobil had the lowest share of costs/market cap, after reporting the highest regulatory burdens, $2.7 billion.
There is, however, one discomfiting implication of the AAF report for conservatives:
Despite the common perception that EPA is the sole driver of new burdens, efficiency rules routinely top the list. The top two proposed rules in 2012 and the top final rule this year were either energy or fuel conservation rules. This year will be no different, with five conservation rules awaiting approval at the White House (see a 2013 regulatory calendar here).
Though I’m not a fan of carbon pricing as such, it is at least possible that a carbon pricing regime would obviate some of the energy and fuel conservation rules identified by AAF. It is also possible, of course, that these regulations could continue to expand alongside a carbon pricing regime.