How Much Is $1 Trillion — Besides Half the Federal Regulatory Cost?

By:  Bob Adelmann
05/02/2014
       
How Much Is $1 Trillion — Besides Half the Federal Regulatory Cost?

Wayne Crews, author of the Competitive Enterprise Institute’s annual report on the federal regulatory burden, has a problem: No one can imagine a trillion dollars — much less $2 trillion.

The Competitive Enterprise Institute’s Wayne Crews has a problem. For years now he has been updating the CEI’s “Ten Thousand Commandments,” the organization's "Annual Snapshot of the Federal Regulatory State,” but the numbers, despite his best efforts, are simply beyond human comprehension.

But he continues to try, nevertheless. He says that the regulatory state takes another $2 trillion out of the economy, partly due to the costs associated with regulating everything from corn syrup to potted plants and partly due to the cost of making sure everyone is following the rules. That means, in the grand scale, the real cost of the federal government isn’t $3.7 trillion — the budget — but it’s more like $5.5 trillion, or about a third of the entire country’s output.

Crews is a clever guy. Not only a VP at CEI, he writes widely elsewhere, including for Forbes. He speaks, he writes books, and he’s the father of four. He’s had his articles published all over, including the Wall Street Journal, the Chicago Tribune, the Washington Post, and Investors’ Business Daily.

He’s also able to do a handstand on his skateboard.

When it comes to measuring the cost of the federal regulatory state, however, he’ll have to do more than a handstand. He measures the cost of the regulatory state, for example, by the number of pages it takes in the Federal Register — 79,311 in just one year — to list them. He says that the average family, with an average income of $65,596, will “pay” $15,000 in regulatory costs, or about 30 percent of the family’s income, buried in the price of that corn syrup and potted plant.

He says that if the regulatory state were a separate country, it would be in the top 10 of all countries in the world, bigger even than Canada or Australia. This doesn’t count the regulatory costs levied on small businesses, either. Companies with fewer than 20 employees pay more than $10,000 a year, per employee, to pay for the regulations, while larger firms pay less per employee but much more in total.

The trouble is, most people can’t imagine a trillion dollars, let alone $2 trillion. Most people can’t even imagine a million dollars. So, next year Crews should talk to the young people behind the Youth Film Festival (YFF) who have successfully stretched the brain to begin to fathom just how much a trillion dollars is, and, as a result, just how large the federal regulatory state really is.

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