Conservatives, Tea Partiers, and libertarians have fought together against taxes and spending in recent years. It’s now time for a third front — a war on regulations. Regulations are what is keeping the unemployment rate so high and federal revenues so low — they’re as big a deterrent to hiring as taxation — and they suck $1.75 trillion a year out of the economy. That’s why I’m so glad to see this third front open up as part of the current debt battle in Washington. The GOP Conference Secretary, John Carter (R., Texas) had this to say today:
“We don’t need new taxes, we need new taxpayers,” says Carter, the author of the Take off the Brakes on the American Economy Act, H.R.1235. “Increasing federal revenue by having more Americans working and paying taxes is the only painless treatment for our deficit illness, and the only goal with universal non-partisan support. Instead of spending and taxing to fight the deficit, we can do so with the truly unique approach of having the federal government do nothing for a couple years.”
The Take off the Brakes Act would place a 2-year moratorium on new federal regulations. The guarantee of a stable regulatory climate would free businesses and investors from fear of the oncoming tsunami of Obama Administration red tape, thereby jump-starting new investment in private infrastructure and market expansion. The American business community is estimated to be sitting on trillions of dollars of investment capital that could spark a massive growth in jobs and income, but is afraid to invest with the uncertainty of the current regulatory and economic environment.
“Businesses can’t and won’t hire if they continue to be inundated by job-killing new federal regulations on everything from construction costs to power production to health insurance,” says Carter. “The resulting 9.2% jobless rate means millions of unemployed families are not contributing payroll taxes while draining federal funds through extended unemployment benefits. If we simply get our folks back to work we will make a dramatic improvement by increasing federal revenues through positive economic growth.”
Three cheers from me and the rest of the gang who’ve been campaigning against excessive regulations for years (see, for example, our annual Ten Thousand Commandments report, or my book). This has to be part of the conversation from now on, and if people like Representative Carter continue to show leadership like this, it will be.
For more, see John Berlau and Wayne Crews in today’s Politico.
Yes. Obviously it's the ambiguous fear of new regulations that's keeping businesses on the sidelines of the economy. Not the lack of people who want to spend money on things.
Reply to this commentLinkReport AbuseThe fear is not ambiguous. Recent reports correlate the drop in hiring to the passage of Obamacare. It is such a poorly conceived plan even the government can't explain its potential impact so how do you expect employers to plan for it? They are doing the only thing they can, sitting on the sidelines until they have some idea of the impact.
New (and unfair) EPA regulations will reduce the electricity generating capacity and increase costs across the board in Texas. Think that's not a major wet blanket on economic investment?
It's not a consumer spending problem, it's poor leadership, uncertainty and yes, fear.
Reply to this commentLinkReport AbuseI keep hearing about the 2 trillion sitting on the sidelines ... from you liberals ...
gee if some folks got hired do you think maybe just maybe they might spend some of their salaries ? on things that other people sell or make ?
maybe ?
Reply to this commentLinkReport AbuseI don't believe this will have much affect. The damaging regulations are already on the books.
Reply to this commentLinkReport AbuseRegulations? Like, in general? Some regulations are good, of course. To use one of Jonah Goldberg's examples, I think it's a good thing that food companies are required to list their ingredients, because it helps me avoid items to which my friends and family are allergic. I think that many traffic regulations are good--for instance, I think it's good that stop signs are the same across (most if not all) jurisdictions. I think it's good that I can require corporations to keep my information private under certain circumstances, and that I can tell (most of) them to stop calling my cellphone or sending me junk mail. These seem like good things, and perfectly in line with conservative principles--heck, not even Friedrich Hayek went so far as to criticize regulations in general.
Of course there are stupid regulations--many of Nurse Bloomberg's recent pronunciamentos would qualify, and maybe some of the regulations in this Ten Thousand Commandments thing would qualify as well. That doesn't change the value of useful regulations, and it doesn't warrant a broad-spectrum argument against regulations in general. To argue otherwise is akin to trying to fight Obamacare by arguing for the abolition of all laws.
Reply to this commentLinkReport AbuseWHile good regulations do exist, it doesn't follow that we need govt to issue those good regulations.
Please research UL for an example of completely private regulations.
Reply to this commentLinkReport AbuseCompanies pay UL for the right to put the UL label on their products. They do this because their customers trust and value the UL label.
Keep going. You've only got another 140,000 pages of federal regulations to justify.
Presumably, ALL regulations create some benefit to somebody in society. The question is whether those benefits outweigh the costs of compliance. Because gov't doesn't operate on the profit motive, it has little incentive to minimize, or even analyze, costs.
When multiplicity of regulation compounds uncertainty on top of compliance costs, the cost to the economy is enormous because uncertainty is anathema to the investment necessary to create jobs and grow the economy.
Just because it's really hard to figure out which regulations have costs that outweight their benefits doesn't mean that it shouldn't be done.
Reply to this commentLinkReport AbuseI think you are confusing laws with regualtions ... many of the things you cite are based on laws not regulations ...
Reply to this commentLinkReport AbuseAnalyzing the impact of various laws on the economy wouldn't hurt either. A freeze of regulations would help maybe a little, but we need serious rollbacks. As a start they ought to get business leaders before Congress to testify about the impact of laws and regulations on their hiring practices.
Reply to this commentLinkReport AbuseInstead of a moratorium why not require that all existing regulations be approved by Congress on an up or down vote (no filibusters, amendments or super-majorities) within 5 years and that all new regulations must receive an up or down vote within five years of publishing? To keep things manageable and limit surprises you could add in a restraint clause that limits the number of regulations that can be voted on at one-time. Any regulation that didn't get Congressional approval within the five year window would be stricken from the Federal Record. You'd address a Constitutional critique of regulations being contrary to the non-delegation clause because Congress would have to approve all regulations eventually. Plus, a lot of silly regulations would be eliminated because no member of Congress wants their opponent to run adds stating that he voted to treat milk spills like oil spills or whatever other ridiculous regulations are on the books.
An additional bonus would be that the time spent reviewing and approving regulations would eat into the time Congress can spend making bad new laws.
Reply to this commentLinkReport AbuseMostly what you suggest is unconstitutional (maybe). Any such up or down vote would still have to be signed by the president (or if vetoed, overridden with 2/3's majority).
It's also impractical, constitutionally, to tell a future house of Congress, how it's going to set up its rules. The constitution does say that each house of Congress determines its own rules, and a statute in effect would not preclude a house of Congress to unilaterally change its rules in contravention of that statute.
Take the present budget battle. One of the points made is that the Senate has violated the law in not producing a budget. But no one is being punished for that.
Reply to this commentLinkReport AbuseThis sounds more like a political stunt than a serious proposal - like using a sledge hammer on 1000 nails spread across a piece of particle board.
If someone doesn't like the health care law, pass a law to prohibit it's implementation. If you don't like regulations limiting CO2 pollution, pass a law prohibiting their implementation. Does Carter actually think the only regulation being considered are ones that are bad for business or job creation? I doubt it. I understand the motivation and I sympathize, but how many much needed reforms or updating of current regulations wouldn't go forward if this was in effect?
There's lots of regulatory uncertainty out there, but stopping all federal rule-makings for two years won't bring certainty. It'll just bring stagnation as businesses are left wondering what the feds will do next. Businesses want stability; a law like this doesn't create stability.
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