By: Bob Goodlatte
There is no argument -- small businesses are the economic engine of America. More than 90 percent of all American employers are small businesses and they generate approximately 70 percent of the new jobs created in the United States each year. Small businesses account for a significant majority of new product ideas and innovation and yet they are being bombarded with costly new government regulations, which are hampering the overall growth of our economy. It is estimated that the cost of regulatory burdens from new regulations this year alone is over $67 billion.
As I mentioned a few weeks ago America's small businesses spend around $10,500 per employee to comply with federal regulations. Simply put, America's job creators are buried under an enormous regulatory burden. This compliance leads to higher consumer costs, reduced wages, and even reduced hiring. In fact, a recent Gallup poll which surveyed small business owners showed that complying with government regulations is the most important problem facing them today.
The Administration has over 4,000 regulations that are currently in the works. Of those, 224 are considered major rules with at least $100 million in economic impact. Assuming those pending major regulations cost only $100 million each that translates to an additional $22 billion in annual economic impact in the works and it would likely be much more since many of these regulations will far exceed $100 million in costs to businesses and consumers.
This week Congress passed, with my strong support, important legislation which will help increase accountability and transparency in the federal regulatory process. The "Regulations From the Executive in Need of Scrutiny Act", otherwise known as the REINS Act, requires Congress to take an up-or-down, stand-alone vote on all new major rules before they can be enforced on the American people, job creators, or State and local governments.
The Congress also passed, with my support, the "Regulatory Flexibility Improvements Act," which closes loopholes that the federal agencies are exploiting to avoid the requirement that they analyze the effect new regulations would have on small businesses. The bill would also enhance current law by strengthening judicial review of an agency's compliance with the law, requiring agencies to examine not only a new regulation's direct impact on small businesses but its indirect impact as well, and requiring all federal agencies to obtain input from small businesses prior to publishing the proposed rule.
Our Constitution grants all legislative powers to Congress. Unfortunately over time those powers have been eroded as the Executive Branch has over-reached more and more. Passage of regulatory reform legislation, such as the REINS Act, ensures that the Executive Branch isn't legislating through costly and burdensome regulations while enabling Congress to retain accountability for the content of the laws it passes.