TEN THOUSAND COMMANDMENTS
June 30, 2006
The exact cost of federal regulations can never be fully known. Firms generally pass along to consumers some of the costs of the taxes they are required to pay. Similarly, some regulatory costs, although generally imposed on businesses, get passed on to consumers.
The Competitive Enterprise Institute's (CEI) annual "Ten Thousand Commandments," highlights some of the costs of federal regulations:
- Extrapolating from an assessment of the federal regulatory enterprise by economist Mark Crain, regulatory costs hit an estimated $1.13 trillion in 2005.
- Given that 2005 government spending was $2.47 trillion, the hidden tax of regulation now approaches half the size on federal spending itself.
- Federal regulatory costs of $1.127 billion combined with outlays of $2.472 billion bring the federal government's share of the economy to 29 percent, compared to 27 percent a year ago.
Moreover, regulatory costs:
- Are more than triple the $318 billion budget deficit.
- Exceed all corporate pre-tax profits, which were $874 billion in 2003.
- Exceed estimated 2005 individual income taxes of $894 billion, and are far greater than corporate income taxes of $226 billion.
The U.S. government has conclusively ended its recent short-lived string of budgetary surpluses -- the first since 1969. But if regaining and maintaining a true surplus remains a priority, policy makers must control regulatory costs, says CEI.
Source: Clyde Wayne Crews, "Ten Thousand Commandments: An Annual Snapshot of the Regulatory State," Competitive Enterprise Institute, June 28, 2006.
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