Economy Hit With Hidden $1.9 Trillion Tax From Federal Regulations
American consumers and the U.S. economy were hit with a nearly $1.9 trillion tax in 2015 through federal regulations, according to a free market thinktank’s new report.
Competitive Enterprise Institute (CEI) describes the thousands of ways Americans are unknowingly taxed by federal regulations in its annual report, “Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State.”
“The federal government has become very savvy in hiding costs by expanding their reach beyond taxes into regulations,” Clyde Wayne Crews Jr., the report’s author, said in a statement. “Unfortunately, regulatory costs get little attention in policy debates, because unlike taxes, they are difficult to quantify because they are unbudgeted and often indirect.”
“But the impacts of burdensome regulations are very real and increase costs for consumers and businesses, limiting productivity and a thriving free market,” he continued.
Federal regulations hide a $15,000 tax per household each year, according to the report. The costs associated with these rules often affect businesses’ prices, workers’ wages, and growth. (RELATED: Every American Would Be $13,000 Richer If Regulations Were Frozen In 1980)
“The federal government’s reach extends well beyond Washington’s taxes, deficits and borrowing,” the report said. “Federal environmental, safety and health, and economic regulations affect the economy by hundreds of billions — even trillions— of dollars annually.”
More than 3,400 rules were issued by agencies, while Congress only enacted 114 laws in 2015, the report said. That means there were about 30 regulations for every law passed. (RELATED: SURVEY: 70% Of Retailers ‘Overwhelmed’ By Regulations)
Around 60 federal bodies are developing almost 3,300 more regulations, the report said. More than 200 of those will have a $100 million effect on the economy annually.
Agencies very rarely analyze the costs and benefits of new rules, and regulators are disinclined to highlight when benefits don’t outweighs costs, Crews wrote.
“In fact, one could expect agencies to devise new and suspect categories of benefits to justify agency rule making activity and new endeavors,” the report said.
The departments of the Treasury, Commerce, Interior, Health and Human Services and Transportation alone make up 41 percent of all federal regulations.
“The 2015 Federal Register contains more than 80,000 pages, the third highest page count in history,” the report said. Six of the seven all-time-highest Federal Register page counts occurred under President Barack Obama.
Also, the Obama administration increased the average major annual regulations by nearly 30 percent from the George W. Bush administration.
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