Regulatory Tentacles Continue to Strangle Growth

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Regulatory Tentacles Continue to Strangle Growth

Harvard's legendary expert on business competition and strategic analysis, Professor Michael Porter, has spent the past decade analyzing the reasons for the relative decline in U.S. economic competitiveness.  In the process, he has regularly surveyed 10,000 of America's top business professionals.1 

As Porter recently explained to the Trends editors, "Asked to identify the greatest impediment to investing and creating jobs in America, our survey respondents cited regulation more than any other problem.  The need is not to lower standards, but to regulate more intelligently, focusing on outcomes rather than compliance methods, and employing rigorous cost-benefit analysis."

The professionals in Porter's survey are not alone in seeing regulation as a barrier to business growth.  Over the past 20 years, the Competitive Enterprise Institute (CEI) has conducted a detailed annual review of the growth and impact of federal regulations on American business competitiveness. 

C. Wayne Crews, the CEI's Vice-President for Policy and Director of Technology Studies, has led this massive project.  The latest results are embodied in the 2013 edition of Ten Thousand Commandments.2

2013 Ten Thousand Commandments

Consider some of the study's conclusions:

  • The U.S. federal government issued 81,883 rules from 1993 through 2012.
  • 127 laws were passed in calendar year 2012, while 3,708 rules were issued.  This disparity highlights a substantial delegation of lawmaking power to unelected agency officials.
  • Regulatory costs totaled $1.806 trillion.
  • On average, each U.S. household "pays" $14,768 annually in hidden regulatory costs; this represents 23 percent of their average income of $63,685, and 30 percent of their expenditure budget of $49,705.

Household Budget Contains $14,768 in Regulatory "Hidden Tax"

  • The Weidenbaum Center at Washington University in St...

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