I was going to title this post ‘regulatory creep’ cause it sounds cool, but when you look at the data, ‘creep’ wholly understates the trend. Surge is a better word.
Seems to me that increasing regulations has to be taking a pretty healthy bite out of the rate of growth (or lack thereof). You’d think that in the midst of such a serious recession, we’d be trimming back on regulations to accelerate growth. But a lot of liberals believe that lack of regulation is what got us into this mess, so we must crank up the regulatory supervision of industry to get back to the right place.
Illustrating the point, one of the commentors on this blog believes we are in an aggressively unbounded period reminiscent of the Robber Baron era of the late 1800’s and early 1900’s. Not sure how that can be believed, but it is.
Here are a few charts.
First, total cost of regulation to private industry is about $1.7T per year – >10% of US GDP. That’s a pile. Source: Competitive Enterprise Institute
Second, a table showing the number of ‘major’ regulations implemented by year. Apparently the metric for this a regulation that costs industry $100M per year to comply with it. Source: Heritage Foundation
Third table shows the severe decline in the number of IPOs (initial public offerings) since Sarbanes-Oxley was implemented in the post-Enron era. Source: Kaufman Foundation
Some other interesting factoids:
– The EPA is adopting new rules that will shut down about 8% of US electric power generation by 2015. Source: Wall Street Journal
– Some smaller banks now employ more people to handle regulatory compliance than the employ to run their operations. The specific source cited employes 1.2 people in compliance for every 1 person employed in lending and marketing/sales. Source: Wall Street Journal
– California is implementing 725 new laws in 2011. These aren’t all necessarily regulations of industry, but many are. Source: LaMesa.Patch.com
There are lots of other examples – seemingly something new announced everyday. Two huge ones obviously are ObamaCare and Dodd-Frank.