At a time when our economy is struggling to recover, Congress has the responsibility to do everything in its power to reduce the costs added by government to doing business and thereby encourage the investment that will lead to economic growth and more American jobs.
In addition to cutting government spending and lowering taxes on job creators, another important step we can take is to comprehensively review our regulatory code to eliminate rules that are ineffective, out of date or an unnecessary burden on American families and businesses. A sensible regulatory code will reduce fees, decrease compliance costs and improve the competitiveness of the United States in the global economy.
To take on this challenge, Congressman Pete Sessions (Texas) introduced House Resolution 72 which calls on ten House committees to review existing, pending and proposed regulations and orders from federal government agencies, and to focus on their impact on our nation’s economy and effect on job creation. HR 72 passed the House of Representatives on Friday, Feb. 11, by a vote of 391-28.
The Small Business Administration estimates the annual cost of federal regulations in the United States exceeded $1.75 trillion in 2008. This is almost double the amount of all individual income taxes collected last year.
The past two years have not provided any relief. From the failed stimulus package to the misguided attempt at health care reform to financial regulatory reform, American businesses have been hit with an explosion of new taxes, regulations and uncertainty that increase the cost of doing business and make it more difficult for businesses to hire additional employees.
For small businesses that have less than twenty employees, the regulatory burden amounts to $10,585 per employee per year. These small firms are responsible for sixty-four percent of net new hires over the last fifteen years, and could play a greater role in reducing our unemployment rate if the regulatory burden on them is lessened.
Excessive regulations can also have a direct impact on American families, many of whom are already struggling to make ends meet, by increasing the costs of food, medicine, doctor visits and utility bills for basic services such as electricity, water and sewer rates.
Anytime a regulation or rule produced by an executive branch agency can have this kind of impact and broad reaching implications on our economy, it should be subject to the review of Congress. This is the idea behind H.R. 10 – the REINS Act, legislation that I introduced to provide greater accountability and transparency in the regulatory process.
The REINS Act would require an up-or-down vote on all rules with an economic impact of over $100 million by both the House and the Senate, and the signature of the President before they can be enforced on the American public.
Reviewing all current and proposed rules as mandated by H. Res. 72 is the first step in transforming our regulatory code from one that discourages investment and hiring, to one that does not hinder economic growth and prosperity for all Americans.
The next step will be to change the way that major rules take effect in the first place. To provide greater transparency and accountability to this process, I look forward to the House moving forward with the REINS Act.
These steps, among others being taken by the House of Representatives will reduce the burden of government and free up capital in the private sector, which can then be reinvested by businesses large and small to get our economy moving and more Americans back to work.
Congressman Geoff Davis