Obama’s Effort To ‘Streamline’ Regs Ends Up Costing $16 Billion More

By Michael Bastasch

The Obama administration’s effort to eliminate red tape hampering American businesses has actually ended up adding $16 billion in new regulatory costs and 16 million hours in new paperwork, according to a report.

The right-leaning American Action Forum found “executive agencies have added more than $16 billion in regulatory costs, up from $14.7 billion in the previous update, and 6.5 million paperwork hours.”

“Too often for this administration, regulations are regularly expanded and rarely repealed or modified,” Sam Batkins, AAF’s director of regulatory policy, wrote in a report released Thursday.

Why did the administration’s effort to streamline regulations actually end up costing the economy more? Batkins says it’s mostly due to an Affordable Care Act regulation and new food safety rule from the Department of Health and Human Services.

HHS’ efforts to streamline its rule to cover outpatient drugs ended up adding $13.3 billion in costs and 12.1 million paperwork burden hours. The department’s food safety rule added another $3.2 billion in costs and paperwork burden hours.

“The agency is, amazingly, responsible for 101 percent of the net cost increase, due to cost-cutting measures from other agencies,” Batkins wrote. “In addition, it comprises 380 percent of the net paperwork burden, again, because of measures to reduce paperwork by other agencies. HHS had five rulemaking updates that quantified costs, but only one actually reduced burdens.”

HHS wasn’t the only agency to add costs in its effort to streamline regulations. The Environmental Protection Agency and Department of Energy together added $410 million in regulatory costs and more than 2.6 million paperwork burden hours.

“The Department of Energy (DOE) took home the silver medal, imposing $300 million in net costs as part of its retrospective review plan,” Batkins wrote. “This time, it included a final rule for efficiency standards for pumps, which will cost $300 million.”

In fact, the only federal agency to significantly streamline its regulations was the Department of Transportation, according to Batkins. DOT reduced regulatory costs by $846 million and more than 21 million paperwork burden hours.

Batkins noted DOT has been one of the few federal agencies to consistently reduce its regulatory burden. AAF records show DOT has “removed $847 million, $2.2 billion, and $2.1 billion in costs,” according to Batkins.

“Out with the old, in with the new,” Batkins wrote. “This might be a sensible aphorism to use when cleaning out the regulatory thicket, but instead this administration has simply piled new rules on top of old. Despite, DOT’s strong efforts, the administration has added $16.4 billion in costs from its most recent “retrospective reports.”

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