Energy

Federal Regulations Amount To A $15,000 ‘Hidden Tax’ On Families, Report Finds

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The federal regulatory apparatus imposed a roughly $14,600 “hidden tax” on American households last year, according to a new report by the Competitive Enterprise Institute (CEI).

“That amounts to 20 percent of the average pretax income of $73,573, and 24 percent of the average expenditure budget of $60,060,” CEI’s Wayne Crews wrote in his annual Ten Thousand Commandments report released Tuesday.

In total, federal regulations, once again, cost the U.S. economy $1.9 trillion despite the Trump administration’s effort to roll back onerous regulations. Crews said his report was a conservative estimate of the true cost of regulations.

“The regulatory ‘tax’ exceeds every item in the household budget except housing,” Crews wrote. “More is ‘spent’ on embedded regulation than on health care, food, transportation, entertainment, apparel, services, and savings.”

One of President Donald Trump’s first actions upon taking office was to rein in federal agencies, like the Environmental Protection Agency (EPA), that had issued billions of dollars worth of regulations during the Obama administration.

And Trump’s had some success, according to Crews.

Crews reported that Trump will cut regulatory costs about $50 billion by the end of 2019, and his administration issued 3,368 rules in 2018. The year before, federal agencies issued just 3,281 rules, which is the lowest since records began in the 1970s.

Trump officials withdrew or delayed 1,579 Obama-era regulations in the pipeline, but those were never finalized. When it comes to repealing existing regulations, progress has been more limited.

The administration has only completed 176 deregulatory actions in 2018, only issuing 14 regulations. Those deregulatory actions saved roughly $23 billion in costs, according to Crews.

“The reality is that the administrative state is alive and well, powering ahead, and the president alone can only do some very limited streamlining,” Crews wrote.

More deregulatory actions are down the road, including replacing the Obama administration’s Clean Power Plan and “waters of the United States” (WOTUS) rules with less costly alternatives. Trump is also in the process of freezing fuel economy regulations for new cars.

However, Crews said Trump’s deregulatory efforts could stall because of the president’s own plans federal agencies, which could potentially yield more rules for anti-trust, trade and on the tech industry.

“President Trump should ignore his regulatory impulses on issues like antitrust, social media and technology, infrastructure, trade restrictions, telecommunications, food and drugs, subsidies, and more,” Crews wrote.

Trump also suffered legal defeats in trying to repeal regulations. For example, courts blocked Trump’s EPA from repealing Obama-era ozone regulations, which opponents called one of the most expensive air regulations ever imposed.

A federal judge in South Carolina lifted a stay against the WOTUS rule in 2018. The administration was still able to issue it’s proposal to roll back the WOTUS rule in December.

Crews called on Trump to “put out an annual regulatory report card, implement a regulatory cost budget to keep his reform agenda on track, and address the misuse of agency guidance documents.”

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