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Op-ed Placement

Regulations Are Stifling Economic Growth

Originally Published in RealClearMarkets on 9/3/14.

As the size and scope of government have expanded, regulators have come to play a much larger role in our day-to-day lives. The advent of the administrative state has created a web of regulations covering everything from design standards for electric appliances to new rules that require hotels and restaurants to accommodate miniature horses as service animals. All too often, common sense is being replaced with exacting statutes and regulations that dictate very specific forms of compliance.

While not as widely reported, regulations can be just as damaging to the economy as taxes. Eliminating excessive regulations and unnecessary compliance costs cannot be overlooked when addressing the issue of economic growth. To the extent that tax reform can provide greater incentives to work, save and invest, regulatory reform is imperative to ensure that businesses have the flexibility to absorb the new economic capacity. Tax reform that offers better incentives for economic growth will yield little if investment and employment opportunities are strangled by red tape and regulation. In this sense, regulatory reform serves to amplify tax reform by creating a marketplace more conducive to economic growth.

Unfortunately, the regulatory burden has yet to be addressed in Washington. Vital sectors of the economy remain mired in paperwork and regulations, and President Obama's signature health care law is creating an expansive new regulatory agenda. Elsewhere, technologies that promise significant benefits to consumers and the economy in general have yet to be deployed due to regulatory barriers and uncertainties. And the administration and the EPA are moving forward with tough new restrictions on emissions that could cost consumers billions of dollars with little to show in terms of benefits. Federal agencies continue to churn out regulations of all kinds; in fact, during the 2013 fiscal year, Washington issued more than 3,600 regulations.