NCPA - National Center for Policy Analysis


August 21, 2008

What goes up and doesn't come down?  The federal budget and the cost of federal regulations.  A new report entitled, "Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State," published by the Competitive Enterprise Institute, finds the cost of federal regulations to consumers was a staggering $1.16 trillion in 2007.

Other major findings:

  • Given that 2007 government spending stood at $2.73 trillion, the hidden tax of regulation now approaches half the level of federal spending itself.
  • Regulation costs more than seven times the $163 billion budget deficit.
  • Regulatory costs nearly match 2005 corporate pretax profits of $1.3 trillion.
  • Regulatory costs also rival estimated 2007 individual income taxes of $1.17 trillion.
  • Combining regulatory costs with federal 2007 outlays brings the federal government's share of the economy to 28 percent.

How to stem the tide?  One way is disclosure, says Clyde Wayne Crews Jr. author of the annual "Ten Thousand Commandments" report, but that's not enough.   Each year's federal budget, or the annual "Economic Report of the President," should include in-depth chapters exploring the regulatory state.

The more the public and policymakers know about regulatory costs, the more likely they are to do something about them, says Crews.

Source: Tom Purcell, "Regulation without representation," Asheville Citizen-Times, August 16, 2008; and Clyde Wayne Crews Jr., "Capital Costs," Forbes, September 1, 2008; based upon: Clyde Wayne Crews Jr., "Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State," Competitive Enterprise Institute,  August 1, 2008.


Browse more articles on Government Issues