In the past 25 years, the United States has been through several cycles of regulation and deregulation. Each time, regulation has imposed substantial economic costs and deregulation has generated significant public benefits. Federal regulatory activity has been growing again since the late 1980s and - by some measures - is at an all time high:

• The staffs of federal regulatory agencies numbered 129,760 in 1993.

• The budget for federal regulatory agencies was about 35 percent higher (in real terms) than in the last year of Jimmy Carter's administration.

• After dropping from 87,000 pages in 1980 to about 53,000 in 1988, the Federal Register, which publishes government regulations, grew back to 69,684 pages by 1993.

Likewise, the cost of compliance by businesses and citizens has continued to rise. The costs imposed by legislation passed in the last several years - such as the Clean Air Act Amendments, the Americans With Disabilities Act and the Family and Medical Leave Act - are only beginning to show up in estimates of economic impact.

The growing costs of regulatory compliance contrast sharply with the savings businesses and citizens have reaped from past deregulation. For example:

• After deregulation, the cost of air travel fell by more than 20 percent (adjusted for inflation) from 1978 to 1991 and accident rates declined by 48 percent, for an estimated annual benefit to consumers of $10 billion.

• Deregulation of the railroads in 1980 saves shippers $3 billion to $5 billion annually, while railroad accidents have declined 70 percent from the late 1970s.

• Interstate trucking deregulation in 1980 saves the economy $8 billion per year, the number of carriers has increased from 18,000 to 48,000 and the fatal accident rate per 100 million vehicle miles shrank 40 percent between 1978 and 1989.

The time is ripe for a new cycle of deregulation, but with hundreds of regulatory statutes on the book, it is not feasible to renew and revise each of them. Taking into account that government intervention often does more harm than good, Congress should consider writing one new law reforming regulation across the board.

Source: Murray Weidenbaum and Melinda Warren, "It's Time to Cut Government Regulations," Contemporary Issues Series 70, February 1995, Center for the Study of American Business, Washington University, Campus Box 1208, One Brookings Drive, St. Louis, MO 63130, (314) 935-5630.

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