Working Paper on Regulatory Budgeting
The exercise of government in America has become much more a matter of regulation than of legislation. In 2015, Federal agencies issued nearly 30 times as many regulations as laws that were enacted. Thus Congress cedes growing shares of its authority to an unelected fourth branch of government with ever-increasing control over Americans’ lives.
The cost of regulations has been estimated at about $2 trillion a year, and one study has shown that a 10-percent increase in the quantity of Federal regulations is associated with a 0.7-percent increase in prices. The current system of cost-benefit analysis used by the administration is wildly inaccurate and prone to data manipulation. The government’s estimates, compared with the experience of those subject to regulation, paint two different pictures. In addition, regulations have effects on individual and property rights that are not readily quantifiable. Despite these facts, Congress has no systematic means of tracking, and if possible restraining, this expansion of the regulatory state. A regulatory budget may not be a panacea, but it could be an important start toward gaining control of the problem.
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