Deregulation is about the most wonky, least click-baity topic there is. It also may be the single biggest reason for the ongoing economic successes of the Trump administration — probably even more than the tax reform package, valuable as that was.
But almost nobody knows about this stealth economic engine and only a few of us continually mention it when referring to the economic powerhouse. Everything else, everything else gets coverage in the Trump administration whether it should or not. But not deregulation. It’s both boring and effective — which combine to make it totally un-newsy.
Which is a shame, because this is an area that Trump can take total credit for and is good for virtually every American — from homeowner, to middle class working stiff to small business owner to exporter. Everyone benefits from a lighter boot on the throat.
In the big picture, regulatory costs either force businesses to pass the costs on to consumers in the form of higher prices or, if the business is an exporter, to squeeze down wages to stay competitive. It also sucks money out of innovation possibilities, costing an unknown and unknowable amount in new products and higher qualities of life.
Generally, environmentalists and environmental journalists around the country (who are basically as much activists as the environmental activists they cover) portray every regulatory rollback as destroying the environment, polluting the air and water and causing the extinction of wildlife. And, of course, the great unknown boogeyman, climate change. Further, they also impugn the motive as giving in to lobbyists.
The White House’s Council of Economic Advisers recently studied 20 regulations that were either repealed by the administration, or are opposed and may be repealed. These generally dealt with labor rules and internet access and were piled on by the Obama administration.
In a straightforward (sort of) cost-benefit analysis, the study concluded that these 20 regulations came to a net cost to the economy of $235 billion — or just more than 1 percent of the national GDP. When impacts can be seen in the gigantic national GDP number, even in a small way, then we have something meaningful.
The report also found that if all 20 regulations are dumped, the average annual gains per American household five years out would be about $3,100.
Now, a major caveat. Any study like this necessarily needs to make some assumptions, and those assumptions are going to drive the final numbers. When assumptions are made by politically motivated players in Washington, D.C., it is not unreasonable for critics to question them. And they do.
Not much, because of course there has been virtually no coverage of this report.
But probably most telling is that the critics — generally people from the Obama administration — do not deny there are net beneficial numbers for the national economy and for individual wage-earners. They just question these specific numbers.
Fair enough. But let’s recall one point. These are only 20 regulations. Presumably these are impact regulations, but the Trump administration bounced 124 “significant” regulations off the books in its first two years, while adding 17. There were hundreds more that are not considered “significant” but can add up. This report measured just 20.
The impacts on the economy, wages and consumer prices is very difficult to estimate, but they are undoubtedly substantial and playing a huge role in 224,000 new jobs created in June, more than 10 years into a now-record recovery, increasing wages, keeping inflation low and maintaining an absolutely rocking economy.
Just don’t expect to read much about this huge stealth effect in the media.
EDITORS NOTE: This Revolutionary Act column is republished with permission. All rights reserved.