SPECIAL REPORT: Big Green regulations suffocate jobs, economic growth 

Care to guess the fastest growing area of federal regulation?

More than 37,000 regulatory reviews were issued by federal agencies from 1981 to January 2005, according to reginfo.gov. Environmental agencies started 6,354 of them. Only agriculture sparked more regulatory activity.

It’s gotten even worse since then. Regulatory expert Angela Logomasini of the Competitive Enterprise Institute estimates that environmental regulations now make up 30 percent of all economically significant regulations submitted for review — more than any other issue.

Federal regulatory spending on environmental issues has increased an incredible 7,372 percent between 1960 and 2006.

 This explosion of regulation of everything remotely connected to the use of land, air and water adds to American taxpayers’ daily burdens, increases the cost of doing business, and destroys millions of jobs, sometimes even whole industries.

Often, the regulation is to aid creatures like the Tennessee snail darter fish. The consequences for human beings can range from minor inconveniences to economic catastrophe.

The regulation has also given the Big Green radical environmental movement and its allies in the federal bureaucracy unprecedented new political power and resources. The raw numbers tell the tale.

Congress passed 1,163 new environmental laws between 1973 and 2006. Logomasini found that only 85 of those statutes reduced government regulation, while 795 increased it. (The remainder lacked significant regulatory impact.)

 Environmental issues were the focus of more legislative activity during that period than any other, except symbolic resolutions and designations.

 Five of the 50 volumes containing the federal regulatory code are devoted exclusively to environmental regulation, and an additional 12 volumes address environmental regulation to some degree.

 Regulatory compliance costs are skyrocketing. According to a Small Business Administration report titled “The Impact of Regulatory Costs on Small Firms,” the total cost of complying with federal regulations is $1.1 trillion a year as of 2004. That’s more than $10,000 per household. The cost of regulatory compliance was just $7,000 in 1995 — up 30 percent in less than a decade.

Of that total, environmental regulation is estimated to cost $221 billion a year, second only to a broadly defined category of “economic regulation.”

The SBA also reports that environmental regulation is the leading regulatory expense for businesses with fewer than 20 employees, at $3,296 per worker.

Overall, regulatory costs are 45 percent higher for small businesses than for larger firms, and environmental regulations are the “main cost drivers in determining the severity of the disproportionate impact on small firms,” according to the SBA. Compliance with environmental regulations costs 364 percent more for small firms than large firms.

Since the vast majority of American businesses are small, the effect these regulations have on job creation and the broader economy is enormously negative.

 Much of the environmental regulation may also be legally indefensible. In a report for the Reason Public Policy Institute titled “Environmental Performance at the Bench: EPA’s Record in Federal Courts,” law professor Jonathan H. Adler looked at regulations challenged in federal courts from 1993 to 2000.

 Adler found that the EPA won only a third of the cases that came before the U.S. Court of Appeals for the D.C. Circuit, the court with primary jurisdiction over federal regulatory activity. All other federal agencies won more than 50 percent of their cases, suggesting the EPA is aggressively exceeding its regulatory authority.

Nor is the effect of environmental legislation being properly considered. President Reagan signed an executive order in 1987 requiring federal agencies to perform a federalism impact study assessing how proposed new rules would affect different areas of the country.

But the Government Accountability Office found that of the 1,914 rules the EPA passed between 1996 and 1998, the agency didn’t do one federalism impact study.

Worst of all, despite all the rules and regulations, they don’t appear to achieve one of the singular goals of the environmental movement: to make Americans safer and healthier.

A paper by the American Enterprise Institute-Brookings Joint Center for Regulatory Studies, “Do Federal Regulations Reduce Mortality?” looked at the effect of 24 health, safety and environmental regulations passed in the 1990s.

The authors concluded that the EPA was responsible for six of the eight worst regulations. All six of these EPA regulations were intended to reduce exposure to carcinogens, yet the authors concluded they all actually raised mortality risks. On net, the EPA regulations examined may have actually cost 97 lives.

But perhaps the area where the environmental regulation has done the most physical harm is the ongoing war on automobiles. “The single biggest step to curbing global warming is making cars go further on a gallon of gas,” observed Dan Becker, former director of the Sierra Club’s Global Warming Program.

Accordingly, government-enforced Corporate Average Fuel Economy standards have driven automakers to make lighter and lighter cars. A Harvard-Brookings study in 1989 concluded that CAFE standards were directly attributable to vehicles weighing 500 pounds less, increasing the chance of traffic fatalities by 14 to 27 percent. 

A 2003 National Highway Traffic Safety Administration study found that a 100-pound reduction in vehicle weight increases the estimated fatality rate as much as 5.6 percent for cars weighing less than 2,950 pounds, 4.7 percent for heavier cars weighing more than 2,950 pounds and 3 percent for light trucks. 

“Between model years 1996 and 1999, these rates translated into additional traffic fatalities of 13,608 for light cars, 10,884 for heavier cars and 14,705 for light trucks,” observes the National Center for Public Policy Research.

 If ill-considered environmental regulation costs each taxpayer thousands of dollars, hamstrings small businesses, often exceeds its legal authority and even costs lives — why do we have so much of it?

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Mark Hemingway

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