The Regulatory Hydra

Copyright 1998 Investor's Business Daily, Inc.
Investor's Business Daily (February 3, 1998)

The Clinton team is bragging that for the first time in 30 years it's submitted a balanced budget. And those numbers come out even. But other numbers show that what President Clinton can't do in the budget, he's going to try to do with regulations.

Businesses are well aware of the costs of regulation. They also know these costs have been growing under Clinton.

Now we know how much. In a paper due out this week, Clyde Wayne Crews of the Competitive Enterprise Institute concludes regulatory costs are out of control. He's right.

Crews' annual report, called "10,000 Commandments," shows the burden of federal rules. By any yardstick, it's not pretty.

The cost of rules in 1997 came in at $688 billion, according to economist Thomas Hopkins, who devised a cost model for the Small Business Administration. By the turn of the century, regulatory costs in real dollars will have jumped to $721 billion.

Federal Register page counts offer another measure. For President Clinton's first five years, they've always run at better than 60,000 pages. President Bush's four years saw page counts culminate at a high of just under 58,000. Ronald Reagan's two terms ended with an annual count of just over 50,000. For 1997, though, pages totaled 68,530, the highest since President Carter.

Of course, not all pages contain final rules - the ones that bite. But the amount of pages that had final rules rose 20% during Clinton's first term. Also, rules with a small-business impact rose 10% in the past five years.

And not all agencies regulate with the same vigor. Veterans' Affairs sends out checks, not regulations. But the Environmental Protection Agency's forte is new rules. For instance, it plans to issue 430 rules in the next 12 months. More than a third, or 163, will affect small businesses. Since Clinton took office in '93, the number of EPA rules affecting small firms increased 92%, Crews says.

Regulations take Washington off the hook. Because they're not line items in a budget, regulations let politicians wreak all sorts of havoc on the public with little accountability. If the heat gets too high, they can always blame unelected bureaucrats.

But until the GOP Congress starts to rein in regulators, Clinton's efforts to expand the reach of government will continue - balanced budget or not.

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