Friday, June 2, 2017

The Obama Legacy, by the Numbers

Undoing the Obama legacy is easier said than done. Among the worst burdens that the Obama presidency imposed on the nation was the mountain of federal regulations. Many suspect that they stifled economic growth, while enhancing the lives of federal bureaucrats.

Writing in the Wall Street Journal James Freeman dubs Barack Obama the $600 billion man. He refers to a report just issued by the Competitive Enterprise Institute:

 As if taxes haven’t been high enough, the U.S. Government also forced Americans to spend an eye-watering $1.9 trillion in 2016 just to comply with federal regulations. That’s according to the latest annual “10,000 Commandments” report released today by Wayne Crews of the Competitive Enterprise Institute. “If it were a country, U.S. regulation would be the world’s seventh-largest economy, ranking behind India and ahead of Italy,” notes Mr. Crews. He adds that our regulatory tab is nearly as large as the total pretax profits of corporations.

Of the $1.9 trillion we spend on regulation, around $600 billion was added by Barack Obama.

Freeman continues:

According to the Crews annual scorecards, the yearly cost of federal regulation soared by more than $700 billion in nominal dollars from 2008, the last full year of the Bush Administration, through Mr. Obama’s final full year of 2016. Adjusting for inflation, you can call Mr. Obama the $600 Billion Man.

Tyler O’Neill (via Maggie’s Farm) crunches the numbers and shows what regulations cost the average American household:

In fact, a new report estimated that if the costs of federal regulation flowed down to U.S. households, the average American family would pay $14,809 annually in a hidden regulatory tax. That's $14,809 in addition to income taxes, state taxes, and Social Security. $14,809 in addition to sales taxes, property taxes, and even estate taxes — where the government taxes you for being dead.

Obviously, it is difficult to measure the effects of these regulations, but surely they increase the cost of doing business. Thus, they must inhibit business growth and expansion:

Liberals and others would point out that no family specifically pays this price, and that is indeed true. But regulations hold back economic progress and make wealth creation harder to come by.

How many entrepreneurs give up on new business opportunities because it is too complicated to hire someone? How many small businesses fail because compliance costs exceed their profit margins? Then there are the increased costs to the larger firms which won't go out of business when the government adds red tape, but will make ordinary goods just that much more expensive.

12 comments:

Ignatius Acton Chesterton OCD said...

"Then there are the increased costs to the larger firms which won't go out of business when the government adds red tape, but will make ordinary goods just that much more expensive."

Yep. This is what Climate Change agenda is all about, and why big business believes it's an important issue that we must act on now. NOW!

There's great attention given to Elon Musk and his threats to drop out of the Trump business agenda because of Climate Change. Well, if your entire business model was based on subsidies that are based on an environmental hoax, you'd make public threats, too.

The reactions to Trump's announcement yesterday are really humorous.

Ares Olympus said...

I see, $1.9 trillion / $14,800/family = 128,300,000 families. That's some serious number crunching.

We can crunch other numbers like a 2015 $17.95 trillion GDP, so the average family income is $140,000. How does your share look there?

Why can't we just go back to the good old fashion days of Hammurabi, just 282 laws. Like #22 "If any one is committing a robbery and is caught, then he shall be put to death."

And speaking of regulation, the death penalty ought to be the cheapest form of justice. Look at the Philippines how quickly they're cleaning up their cities of illegal drugs now that vigilante executions are sanctioned.

America could become great just like the Philippines, if we can simplify things sufficiently.

Paul McLellan said...

I think the little remark about estate tax "where the government taxes you for being dead" is a little snarky. I don't know why proponents of estate tax don't just make it optional, with the alternative being either to sell all the investments and pay capital gains as if the person dying had done so at the moment of death (or perhaps allow them to transfer untaxed to the heirs, but with the original basis). I bet a lot of people would go for the "estate tax" route, if only for the simplicity.

Stuart Schneiderman said...

Actually, it's more than a little snarky. Thanks for a good alternative suggestion.

trigger warning said...

In a bid to justify his drilling regulations, Obama famously said,

"we can't just drill our way to cheaper gas"

:-D

OPEC begs to differ. And it's a perfect and visible example of regulatory cost.

James said...

The Left is acting like it's the end of the world. Wait, maybe it is. Let's see the coming of the end has been predicted many many times, just never has quite got here yet. Ah, the smug self appointed righteousness of it all. And strangely enough it always seems that just a little more money is needed and fortunately it is always someone else's money. If people think that whatever monies raised by some sort of worldwide taxing or compliance is really really going to remediate global warming and not into the pockets of our self anointed saviors well then they had better watch out for snattlerakes, an extremely toxic and aggressive subspecies of rattlesnakes. Very difficult to tell them apart as their heads and tails are on different ends.

Sam L. said...

Regulations: It's rather like being eaten by army ants.

dda6ga dda6ga said...

And now in California the legislature will add a tax of $13% on all GROSS RECEIPTS to businesses...

Ignatius Acton Chesterton OCD said...

James: Snattkerakes? I like that one!

Anonymous said...

Well, big industry in Wall Street, Hollywood, Silicon Valley, and etc backed Obama.

And Hillary was backed by oligarchs over Trump 20 to 1.

And Obama gave Wall Street mega-bailouts.

And what did Wall Street give American people? Bubbles, crisis, and 'gay marriage'.

Hell with Wall Street.

James said...

IAC,
Dangerous business, dangerous business!

Jackie Raynal said...

Yes indeed, agreed with that suggestion.