Magazine article Regulation

Tight Budgets Constrain Some Regulatory Agencies, but Not All

Magazine article Regulation

Tight Budgets Constrain Some Regulatory Agencies, but Not All

Article excerpt

Regulations are an increasingly important aspect of modern American life, and yet measuring regulatory activity is challenging. The cooperative effort between the George Washington University Regulatory Studies Center and Washington University in St. Louis's Weidenbaum Center on the Economy, Government, and Public Policy to track the trends in federal regulatory agencies' expenditures helps monitor one component of the impact of regulation: the direct taxpayer costs associated with developing, administering, and enforcing federal rules and regulations. Each year we examine the President's Proposed Budget of the United States to identify the outlays and staffing devoted to developing and enforcing federal regulations. This "regulators' budget" report covers agencies whose regulations primarily affect private-sector activities and expressly excludes budget and staffing associated with regulations that govern taxation, entitlement, procurement, subsidy, and credit functions.

Our most recent report examines the requested budget outlays in fiscal year 2015 as well as estimated outlays for FY 2014. It also provides 56 years of data on annual outlays and staffing, from FY 1960 to the present. Those data reflect the on-budget costs of regulation and cannot inform analysts about the benefits regulations may convey. They also do not reflect full costs, as regulations impose social costs beyond the direct tax dollars spent to write and enforce them. An assessment of the full cost would not only calculate businesses' and individuals' costs associated with compliance, but also the loss of economic opportunities and choices available to individuals and organizations.

Despite those limitations, the time-series data on expenditures and staffing of federal regulatory agencies presented in the regulators' budget report offer a useful proxy of the size and growth in regulations that American businesses, workers, and consumers must follow. This information can serve as a barometer of regulatory activity, providing policymakers and analysts with useful insights into the composition and evolution of regulation over time.

Overall, this year's report finds that the regulators' budget continues to grow at a modest pace. The proposed budget for regulatory activities in FY 2015 is $60.9 billion (in nominal dollars), a real (inflation-adjusted) increase of 3.5 percent above estimated FY 2014 outlays. (See Figure 1.) The FY 2014 regulators' budget of $57.8 billion is 2 percent larger than FY 2013 regulatory agencies' outlays of $55.9 billion. The proposed budget also requests an increase in federal regulatory agency personnel of 0. …

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