Representative Todd Tiahrt - 4th Congressional District of Kansas

| Bureaucratic Red Tape Termination |

Regulatory Costs are Killing Jobs.

Less government not only means granting the freedom to allow Americans to pursue their dreams, it also means providing the space for businesses to thrive. Instead our federal government has become a creeping ivy of regulations that strangle enterprise.

Unrealistic, impractical, unnecessary environmental prohibitions, OSHA mandates, and the like are literally driving our industries, small businesses, and our health care system to a grinding halt.

How can we expect our economy to develop and grow when bureaucracy prevents businesses from starting or expanding, when doctors cannot even keep up with the ever-changing codes, and teachers are forced to spend more time filling out paperwork than in the classroom?

The Heritage Foundation asserts that reducing the regulatory burden would do much to speed economic recovery and create jobs, as well as help consumers. There are opportunities for reform in a number of areas, ranging from burdensome telecommunications rules that are slowing progress to next-generation Internet technologies, to unnecessary costly environmental regulations that make economic growth difficult, to outdated workplace regulations that discourage job creation.

Regulatory Stats

The Office of Management and Budget (OMB) has reported that Americans spend about $1.50 in compliance costs for every $1.00 in tax costs devoted to regulation.
Moreover, it is suggested that for every dollar of direct budget expenditure devoted to regulatory activity, the private sector—individuals, investors, workers, etc.—spends $45 in compliance.
Over the past decade, small firms have accounted for 60 to 80 percent of the net new jobs in the U.S. economy.
(U.S. Census Bureau, Statistics of U.S. Businesses)
The Code of Federal Regulations (CFR) extends 19 running feet.

House Action

The Republican Congress has made regulatory reform a priority - from the 104th Congress when it passed federal bureaucratic reforms under the Job Creation and Wage Enhancement Act (part of the Contract with America that among other things required federal agencies to assess the risk and cost of each imposed regulation) to the 2004 passage of the Financial Services Regulatory Relief Act, with a myriad of bills and amendments aimed at cutting red tape in between.

Competitiveness

Compliance costs for regulations can be regarded as the "silent killer" of manufacturing competitiveness. "How Structural Costs Imposed on U.S. Manufacturers Harm Workers and Threaten Competitiveness" MAPI/Manufacturers Alliance

A global CEO survey shows 6 in 10 company heads view regulation as a serious threat to the growth of their business, topping exchange rates, corporate governance issues, and even terrorism. (The Heritage Foundation)

Small business is leading America's economic recovery, but an overwhelming burden of federal paperwork, rules, and regulations threatens their competitiveness and ability to spur job creation.

Regulation imposes its heaviest burden on small and medium sized businesses because it is harder for them to handle the necessary overhead costs of paperwork, attorney and accountant fees, and staff time.

Richard Vedder, an economist at the Center for the Study of American Business, finds that federal regulations cause $1.3 trillion in economic output to be lost each year. This is roughly equivalent to the entire economic output of the mid-Atlantic region, which includes Delaware, the District of Columbia, Maryland, New Jersey, New York, and Pennsylvania.

According to the Manufacturing Alliance/MAPI study "How Structural Costs Imposed on U.S. Manufacturers Harm Workers and Threaten Competitiveness":

In terms of compliance, three areas of regulation are hit particularly hard: consumer safety, workplace safety, and environmental protection.

The total compliance burden of environmental, economic, workplace and tax compliance on the economy is in the order of $850 billion. The regulatory compliance burden on U.S. Manufacturers is the equivalent of a 12 percent excise tax.