Government spending may be slowing but regulatory output is not. The number of regulations passed the one million mark in 2010, and their volume continues to rise. What does the continuing growth of so many rules mean for the U.S. economy and individual industries?
Regulation University: The Consequences of Regulatory Accumulation
1. Regulation University:
The Consequences of
Regulatory Accumulation
February 28, 2014
Patrick A. McLaughlin
Senior Research Fellow
Mercatus Center at George Mason University
4. Why is it a problem?
1. Blocks innovation and
entrepreneurship
2. Diverts attention from new and
important risks
3. Wastes scarce agency resources
5. Less innovation = less growth
in trillions of real dollars
60
What would GDP have been in 2011
if regulations had stayed at 1949 levels?
$53.9 trillion
50
40
30
20
$15.1 trillion
10
0
Actual GDP
Potential GDP
19. First test of functionality: Risk
Nonsignificant
Significant risk risk
Current risk Functional
Nonfunctional
Noncurrent
risk
Nonfunctional Nonfunctional
20. Second test of functionality:
Outcomes
Achieving
outcome
Not achieving
Necessary
to maintain
outcome
Functional
Nonfunctional
Not
necessary
to maintain Nonfunctional Nonfunctional
21. Overcome groups with vested
interests in keeping rules
1. Agencies
2. Incumbent businesses
3. Special interest groups