Who Will Regulate The Regulators?

Some of the signs in the economy are hopeful. The stock market is slowly inching upwards, though it’s two steps up and one step back. New home sales have finally ceased to be stagnant, though this follows the same pattern as the stock market. But at least one bad economic indicator remains stubbornly bad.

Unemployment continues to hover above 8% despite the “jobs president’s” promises. The National Federation of Independent Businesses cites over-regulation as a major cause. The business organization asked small business owners nationwide to name what they thought was the biggest contributor to their inability to hire new people. Number one, as always, was “poor sales” at 20%. But even that is a fairly generic description of poor business conditions. Coming in at number two was government regulation and red tape at 19%. That’s a far more specific complaint, and certainly could be a major factor in the number one choice, generic poor sales. If you can’t hire people to make your product and people to sell it, you’re probably going to suffer from poor sales.

When the socialist-leaning Economist of London agrees with American small business owners, you know you’re in trouble. In its cover story entitled “Over-regulated America,” the Economist says that “the home of laissez-faire is being suffocated by excessive and badly written regulation.” Coming from a publication that thrives in the nation that almost single-handedly created the nanny state, this should be taken as a serious warning.

The Great Economist Barack Obama also claims to see the problem. In a major speech, Obama said: “The rules have gotten out of balance, resulting in a chilling effect on growth and jobs.” Having recognized the problem, the Obama administration promptly instituted dozens of new regulations to regulate the regulations in less than six months. The states aren’t much better, and seem to pile regulations of their own on top of the federal regulations.

The sign in the photo is a perfect example of the states exceeding the federal government in stupid regulations. If you see a vending machine in Florida that doesn’t have that sign, you should immediately call that phone number, even if you have no idea what alleged violation is involved or what heinous crime is being committed. Of course if the sign isn’t there, you won’t know to call. Let me help you out. It’s the phone number of the Tallahassee Office of the State of Florida Taxpayer Service Center. They’re asking you to be a tax snitch. And it’s a bit like saying, “if you see this sign, ignore it.”

A study conducted by the Small Business Administration determined that regulation alone accounted for about $10,585 in costs to business per employee, per year. With the economy already going into its fourth crummy year, it’s not hard to figure out why the biggest producers of new jobs are hesitating to hire. That is why many economists are calling the current state of the economy a “jobless recovery.”

John Stossel recently did a Fox News special entitled “Everything’s Illegal.” One of his interviewees stated flatly that every single business owner is in violation of at least five obscure or self-contradictory regulations. You think the power to tax is the power to destroy? Try the power to regulate. From kids selling home-made lemonade which has not been tested and approved by the FDA to private individuals selling an occasional goat or sheep to a friend, the regulators are there to punish.

The Economist points out that the federal government has nine codes regulating the keeping of parrots and regulating injury which might conceivably be caused by or to parrots. There are three regulations regarding the proper treatment of burn injuries caused by flaming water-skis. In 2011, the feds instituted some major new rules. Emission standards for commercial boilers were raised to prevent pollution and global warming. The cost to the industry could go as high as $20 billion in one year. The SBA said the new regulation would likely cost 40,000 to 60,000 lost jobs.

Power plants in twenty-seven states have also been required under another new regulation to reduce emissions. That cost per year is expected to be about $845 million, and the loss of a few thousand jobs. Consumers and independent owner-operators of combination trucks, heavy-duty pickups, vans and vocational vehicles (like mobile libraries) are getting hit with new fuel-efficiency standards that will raise the costs of the vehicles by as much as $6,000 per vehicle and an annual total cost to the industry of $607 million. That’s both a job-killer and a business-killer.

At the same time, the regulators at the State Department in concert with the Environmental Protection Agency and under the marching orders of President Obama have turned down the Keystone XL pipeline which might, maybe, sorta damage some hills in Nebraska. The 20,000 “shovel-ready” jobs instantly lost are irrelevant as far as this administration is concerned. Regulations is regulations, and that’s that. And don’t get me started on the regulation of water in California’s Central Valley that has crippled California agriculture in order to save one useless fish species.

As always, Barack Obama is talking out of both sides of his mouth. He claims to understand the problem of over-regulation, then institutes more. The number of regulations is a matter of official and mandated public record. They are produced and managed by the Office of the Federal Register. New regulations must be published in the Register. In 2009, the number was 68,598 pages. In 2010, it was 81,405 pages.

In 2011, the number of pages went up faster than the Dow to 82,415. And now you know why the expert on the Stossel show said what he said about how many regulations every single business is violating on a daily basis. It would require every business to make its first new hire a “regulation reader.” Before hiring anyone else, a company would need to hire an employee just to read the rules and regulations and advise the company if it is in compliance with every one of them. And even at that, the reader would probably have to advise the company that if it complies with every rule and regulation affecting it, the company would be unable to conduct business anyway. Close the doors.