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About the Issue

Excessive and Costly Regulations Are Harming the Economy

Most regulations are necessary to ensuring there are clear rules for operating in a complex society. But excessively costly regulations are harming the economy and inhibiting job creation. “Regulatory uncertainty” is one reason employers are reluctant to hire and we’re witnessing a jobless recovery.

Compliance costs harm small businesses—the jobs engine of the economy—the most. Businesses with fewer than 20 employees incur regulatory costs 42% higher than larger businesses of up to 500 employees.

The average regulatory cost for each employee of a small business exceeds $10,000 per year.

And the problem is getting worse, as we are seeing an unprecedented increase in regulations.

We Must Restore Balance to the Process and Fix What’s Broken

These burdens are imposed through a system that operates without effective checks and balances, or accountability. Currently, nearly all major regulations go into effect without our elected representatives in Congress ever voting on them.

The process has lost all balance as Congress has yielded power to the federal agencies without proper accountability, and without taking responsibility for what the agencies are doing in Congress’s name.

What’s more, the agencies often are not transparent. Unaccountable agencies rarely have to justify decisions they make that harm the livelihoods of millions of Americans because the process does not allow for effective judicial or other independent review of major rules.

Agencies can do this because they do not have to prove their assertions are based on sound fact, science, or economics. Rather, all the agency must do is point to anything in the agency record that rationally supports their assertion, and the courts give the agency deference over the public in deciding the validity of the rule.

We must reform the process to make it more effective and accountable to the people to be sure regulations are of the highest quality.