Obama Cuts Red TapeAugust 24th, 2011 by Lee Eldridge
I’ve been planning to write a post about government regulations for some time. And this isn’t it. But here are a few tidbits to chew on until we have time to talk about this in-depth. Earlier this year, President Obama in an op-ed in the Wall Street Journal made a pledge to help businesses by eliminating red tape.
We’re also getting rid of absurd and unnecessary paperwork requirements that waste time and money. We’re looking at the system as a whole to make sure we avoid excessive, inconsistent and redundant regulation. And finally, today I am directing federal agencies to do more to account for—and reduce—the burdens regulations may place on small businesses. Small firms drive growth and create most new jobs in this country. We need to make sure nothing stands in their way.
You can read his op-ed from January in the Wall Street Journal here.
Another more recent quote from President Obama:
What I have done — and this is unprecedented … is I’ve said to each agency … “look at regulations that are already on the books and if they don’t make sense, let’s get rid of them.”
This week the administration has announced its plan to update government rules and regulations. You can read this post on the White House’s website from Cass Sunstein, the Administrator of the Office of Information and Regulatory Affairs. According to Sunstein, “Over the next five years, the monetized savings from just a fraction of the reforms announced today are likely to exceed $10 billion.”
Now a few facts to put this into perspective. From Investors.com in an unrelated article from June:
Government regulations come with costs. Compliance is a heavy burden. During a news conference in which Hartzler spoke of “horror stories” caused by rules, she referred to a Small Business Administration estimate that says government regulations cost the economy more than $1.75 trillion a year, about 12% to 14% of GDP and half of what Washington is now spending — $3.456 trillion — in a year.
The Competitive Enterprise Institute, which has been keeping up with federal regulation for years through its yearly “Ten Thousand Commandments” reports, believes the cost is closer to $1.8 trillion because agencies spend an estimated “$55.4 billion (on budget) to administer and police the regulatory enterprise.”
Let’s see, we make changes to save businesses $10 billion over the next five years, compared to the $8.75 trillion that will be spent on compliance. And that does not include the thousands of new rules and regulations that are still being written from ObamaCare and the Dodd-Frank banking reforms.
And on a side note, PolitiFact gave the President a “Pants on Fire” for his claim that his approach to cutting red tape was “unprecedented”.