NCPA - National Center for Policy Analysis

Higher Regulatory Costs

December 11, 1998

The cost of operating the federal regulatory establishment is scheduled to reach an all-time high of $17.9 billion in fiscal year 1999, according to a recent analysis. This is an increase of less than 1 percent over projections for 1998, but comes on the heels of an 8.4 percent jump in regulatory spending in 1998. This amount represents only what the federal government spends, and does not reflect the compliance costs to the private sector, which are far higher.

Researchers divided spending and staffing at the 61 regulatory agencies into social and economic categories.

  • Spending increased rapidly for social regulatory programs throughout the 1960s and 1970s, while the budgets of the economic regulatory agencies continued to grow, but at a much slower rate.
  • After peaking in 1980, total real regulatory spending actually decreased each year until the late 1980s, which it began rising again.
  • Total regulatory spending grew at a real annual rate of 9.2 percent from 1960 to 1970 and 8.5 percent from 1970 to 1980, but only 1.7 percent from 1980 to 1990.

Source: Melinda Warren and William F. Lauber, "Regulatory Changes and Trends: An Analysis of the 1999 Federal Budget," Regulatory Budget Report 21, November 1998, Center for the Study of American Business, Campus Box 1027, One Brookings Drive, St. Louis, Mo. 63130, (314) 935-5630.

 

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