Friday, 17 Aug 2012 09:05 AM By Julie Crawshaw
The Obama administration is steering the country toward a steep “regulatory cliff” that could exacerbate the damage the so-called fiscal cliff will cause, according to Sen. Rob Portman, R-Ohio.
“After three years of bureaucratic excess, the Obama administration has been quietly postponing several multibillion-dollar regulations until after the November election,” Portman writes in The Wall Street Journal.
“Those delayed rules, together with more than 130 unfinished mandates under the 2010 Dodd-Frank financial law, could significantly increase the regulatory drag on our economy in 2013.”
For example, Portman points to a regulation the Labor Department is working on that would make the cost of retirement planning for middle-class workers increase in order to “protect” them from free investment help.
“This regulation, known as the Fiduciary Rule, would tighten restrictions and increase litigation risks for businesses that offer investment guidance on a commission basis, rather than the more expensive fee-for-service model,” says Portman.
Another momentarily shelved regulation, which could impose up to $90 billion in yearly costs on manufacturers and other employers, is the Environmental Protection Agency’s Ozone Rule. This rule would limit ozone emissions, but is so exacting that up to 85 percent of U.S. counties monitored by the EPA would be in violation of the rule.
Susan Dudley, a regulatory economist at George Washington University, says that under this rule, many communities would be forced “to forego productive investment and hiring decisions in order to spend hundreds of billions of dollars per year in vain attempts to meet unachievable standards,” Portman writes in The Journal.
Another EPA rule targets equipment that manufacturing facilities and power plants use to bring in water to prevent overheating; however, those intake systems are not harmful to human health or water quality.
“Last year the EPA estimated that this new rule would cost $1 for every three cents in benefits,” Portman says.
In addition, a new Department of Transportation rule would increase the costs of new vehicles by requiring that all cars and trucks be equipped with a rear-view camera and video display on the dashboard, at a cost of approximately $2.7 billion to automakers and car buyers.
“Americans who want this technology are free to buy it and more than 40 percent of new cars have it,” Portman writes in The Journal. “We don’t need a government mandate to drive up costs for families who need to economize.
“Not surprisingly, the administration delayed moving forward on this costly rule until after Dec. 31.”
William M. Isaac, former chairman of the Federal Deposit Insurance Corp. (FDIC), agrees that the regulations are getting out of hand, telling Newsmax.TV in an exclusive interview that excessive regulations are preventing the labor market from recovering, as companies are unable to invest and hire while they fret over compliance.
New regulations, including those outlined in the Dodd-Frank financial-overhaul legislation as well as the Patient Protection and Affordable Care Act, are also preventing smaller banks from lending to smaller businesses, which further prevents job-creating endeavors from getting off the ground.
“The Obamacare bill, the Dodd-Frank bill, all of these things could have waited until another day. What we really needed to do is focus on the economy and how to create jobs,” Isaac told Newsmax.TV.
According to the Foothills Media Group, the average small business in the United States today spends more than $10,000 for each employee it hires in order to comply with regulations.
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