YA THINK? The Economic Stimulus Perplex: Could Regulation Be the Problem? Progressives and the failure of massive government spending to boost jobs and economic growth.
In his column, Samuelson asks, “What ails the private sector? Can we do anything about it? Those are the crucial questions.”
Perhaps the answer to what ails the private sector is excessive regulation. A recent study by the conservative American Action Forum estimates that the Obama administration is on track to adopt over 600 major regulations (those costing more than $100 million each) by the end of the president’s term. The total cost of complying with all of the new regulations will add up to $813 billion. The libertarian Competitive Enterprise Institute calculates that extent and cost of Washington’s rules and mandates is $1.8 trillion annually, amounting to about $15,000 per household each year. Even the New York Times on Sunday called President Obama, the regulator-in-chief whose new rules have “imposed billions of dollars in new costs on businesses and consumers.”Article Continues Below
I have reported earlier analyses that found that regulatory drag has made the U.S. economy $4 trillion smaller than it would otherwise have been. That amounts to a lot of foregone jobs and consumption. I would like to suggest that hugely escalating regulatory costs under the Obama administration have mostly offset whatever the benefits that orthodox Keynesians would expect from economic stimulus. In other words, President Obama has been trying to use Keynesian stimulation to rev the economy while simultaneously jamming down hard on the regulatory brakes.
Well, regulation is an important source of graft.