Halloween Is Over but America’s Web of Regulations Is Still Scary

Halloween has come and gone, but people still in the mood for a fright have to look no farther than America’s growing web of regulations. The U.S. Code of Federal Regulations has characteristics similar to some of our favorite Halloween characters. The Blob grew inexorably, and the number of words in the code has grown by about 195 percent since 1970. Reminiscent of classic movie monsters, the regulatory code seems impervious to multiple efforts to slow its growth from committees, agencies, and administrations.  Regulations have become increasingly lengthy and complex over time, and impose substantial burdens on companies and consumers alike. Although it is a difficult prospect and previous efforts have struggled to find success, the Trump administration should stand firm in its commitment to reform the country’s regulatory framework.

A report from Deloitte estimated that two-thirds of all federal government regulations on the books have never been updated. Some of these regulations have remained in place for decades, even as the surrounding landscape has evolved. Many of these rules are outdated or even obsolete, but they remain. The average section of the CFR has not been edited or updates in any way for 19.4 years. They give the example of a regulation from 1905 with rules about log rolling on a river in Minnesota, but no log rolling has taken place there in 80 years.

The accumulation and growth of the regulatory code introduces the potential for economic distortions, compliance burdens, and other unintended consequences. The complexity and overall scale of the code in total can compound or exacerbate these problems. Fortunately, the administration has committed to reexamining regulations already in place and to reining in the rate at with new ones are introduced.

The Federal Communications Commission (FCC) announced last week that it would end rules on telegraphs as part of the Trump administration’s push to end unnecessary regulations and create a more streamlined, navigable framework. The removal of these rules is a welcome development, but the context gives a sense of the scope of bloat in the current system. The last telegram in the United States was sent eleven years ago, and the last major telegram service in the world went out of business in 2013.

It is certainly positive that this vestigial rule is no longer adding to the knot of federal regulations, but more than a decade has elapsed since there was a telegram sent in the country. An executive order has tasked agencies to identify two existing regulations that could be repealed for each new one, which should accelerate the process of reviewing and removing old, outdated, or ineffective regulations that have remained in place due to inertia.

Slowing the growth of the regulatory code is also important to fostering a regulatory environment that encourages innovation and economic activity instead of hindering it. Over the first nine months of the Trump administration, agencies have issued 116 significant rules, those with an effect of $100 million or more. This represents a 58 percent decrease from the corresponding nine months of 2016 under the Obama administration. The number of significant proposed rules is also down substantially, at 65 for the period compared to 290 in 2016. The rate at which new rules being added to the extensive framework already in place has slowed, which will limit instances where rules that are overly burdensome or not properly considered are enacted without full consideration of potential unintended consequences.

The FCC’s commitment to clearing outdated regulations is encouraging, as is the administration’s commitment to a broader re-evaluation of current regulations, but the scale of the problem they are facing can be daunting. Sustained and concentrated efforts will be required to streamline the country’s regulatory environment, reduce onerous rules, and remove barriers to productive economic activity.

Charles Hughes is a policy analyst at the Manhattan Institute. Follow him on Twitter @CharlesHHughes. 

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