The wreckage caused by regulations may be even worse than previously thought, according to analyses by industry experts and think tank scholars chronicled in a shocking new report published today by the government-watchdog group Public Citizen.
Just eight prominent regulations issued since the 1970s jeopardized more than 55 million jobs, according to the report. This means that just these few regulations may have quietly exacted a toll of lost jobs six times worse than the Great Recession, and several times greater than the number of Americans who are currently unemployed.
Stunning as that conclusion is, it may significantly understate the harms because it regards only regulations that were prominent enough to warrant job-loss analyses. In separate inquires, think tank experts have applied sophisticated econometric models to get a handle on the overall toll of regulations.
The results these experts have generated are truly mind-boggling. For instance, if the government's regulatory oversight efforts had been just one-sixth smaller over the past five years, 18.8 million additional jobs would have been created, according to findings published in 2011 by the Washington, D.C.-based Phoenix Center for Advanced Legal & Economic Public Policy Studies. That's two Great Recessions worth of lost jobs during the Great Recession. All told, federal regulations have prevented the creation of a stunning 160 million jobs since 2006, the Phoenix Center's methodology suggests. To put the depth of that damage in perspective, there are only about 144 million jobs in the United States right now.
It gets worse. Research conducted in the 1990s by a Heritage Foundation scholar indicates that regulations do not just kill jobs, they kill people--and at an alarming rate. Updating that scholar's research to account for inflation and a more current estimate on the overall cost of regulations yields the conclusion that regulations are in fact the third-leading killer of Americans, trailing only heart disease and cancer.
As a caveat, the examples in the report are based on forecasts and modeling, and do not necessarily fully comport with reality.
For example, one of the examples cited in the report concerned a forecast by legendary auto industry executive Lee Iacocca that a 1970s tailpipe emissions rule would cause Ford Motor Co. to shut down and would cost 800,000 jobs. In that particular instance, the industry was able to solve the problem without economic upheaval, and polluting emissions were dramatically reduced almost overnight.
In another case, industry said that a rule to protect workers from cancer-causing fumes from the manufacture of polyvinyl chloride (PVC) would be impossible to meet and would cost 2.2 million jobs. But in that instance, industry was quickly able to develop a new system that both ended the cancer threat and increased efficiency.
In another case, industry representatives warned that a 1990s clean air law would cost up to 2 million jobs. But complying with that law ended up being far less expensive than expected, and the resulting cleaner air is credited with preventing about 200,000 premature deaths a year.
In another case, the petrochemical industry said that banning lead in gasoline would jeopardize up to 42 million jobs. But suitable substitutes for lead were easily adapted, and the removal of lead from the atmosphere is credited with preventing 1.2 million premature deaths every year.
Although space does not permit a full elaboration, I will acknowledge that it is the case that none of the other industry forecasts cited in the report ended up being accurate, either. Admittedly, this calls into question the accuracy of broader conclusions that regulations writ large have been perpetually causing Great Recession-levels of job losses and epidemic levels of fatalities.
But the stakes today are even greater than in the past. Rules intended to reduce air pollution and protect the financial system against collapse, alone, are going to wipe out 12.5 million jobs over the next decade unless they are repealed, industry's experts have warned us.
Yes, it might be true that industry's prognosticators have had a rough patch over the last 40 years or so. But in light of how scary their current forecasts are, shouldn't we just trust them this time around?