What’s the price we pay for all those federal regulations the government keeps churning out?
Clyde Crews, a scholar with the Cato Institute, estimates that our economy loses $788 billion a year because of regulations. He figures that a typical two-income family loses about 18 percent of its after-tax budget to hidden regulatory costs. Things cost us almost 20 percent more to buy than they would have without all the regulation-run-wild. Ouch. But not all of the cost is so hidden and generalized.
All these regulations also mean a lot of arbitrary power for bureaucrats. And very specific pain and suffering for the hapless individuals who become their target. Consider the case of the Manganas Painting Company.In the early 1990s Manganas was hit with the second largest fine in the history of the Occupational Safety and Health Administration: four million dollars. Levied, of course, the very day new safety laws went into effect. And even though another agency, the EPA, had required a bridge enclosure that actually increased respiratory health risks. And even though John Manganas had bought hundreds of thousands of dollars of safety equipment.
The case has taken a while to make its way through the courts. But Manganas has already suffered a huge cost in lost business and lost reputation. He says he was always willing to meet OSHA’s requirements, but wasn’t given a chance. They painted him into a corner. Congress hands agencies the power to regulate, then washes its hands of the mess. There must be a better way.
This is Common Sense.Â I’m Paul Jacob.