Regulatory Costs: You Pay in Many Ways

Yesterday the US 'cost of regulation' index became available. It's high and getting higher.

But besides forcing us to pay more for almost anything we buy, there are other more serious implications--far more serious.

Need copper?

Although we are blessed with abundant mineral deposits and have developed many of the world’s innovative mining technologies, we have become dangerously dependent on foreign sources. The U.S. Geological Survey reported in 2005 that “U.S. manufacturers and consumers of mineral products that are critical to the U.S. economy depended on other countries for 100 percent of 17 mineral commodities (an increase of 6 percent over 2003) and for more than 50 percent of 42 mineral commodities (an increase of 8 percent over 2003).” Between 1997 and 2002, there was a 66-percent decline in U.S. mining exploration spending. One reason for this is the lengthy permit process. Obtaining a permit for copper mining in the United States, for instance, can take from 4-8 years compared with 18 months for Chile.

Need energy?

“If we look back to the mid-1990s,” the NAM points out, “the United States enjoyed a 30 percent cost advantage with regard to natural gas on a trade-weighted basis.” However, says the NAM 2006 report, The Escalating Cost Crisis, “the steady increase in U.S. prices since then is purely the result of policy decisions that have limited development of domestic reserves and Clean Air Act mandates that have increased demand” for natural gas.

According to the U.S. Minerals Management Service, areas of America’s outer continental shelf (OCS) currently banned from development likely contain a mean estimate of 18.92 billion barrels of oil and 85.79 trillion cubic feet of natural gas recoverable by current technical means. However, federal environmental policies are preventing us from accessing that treasure trove of desperately needed energy

Need food? Well, the corn's being fed to your CAR--increasing the prices of beef, milk, breakfast cereals, Coca-Cola, and beer.

Yes, it's a regulatory cost--driven by the GreenWeenies (and their willing running-dogs in Congress.) The ADM/Farm lobby inserted Corn-A-Hole as "the solution" to a largely vestigial and diminishing "air pollution problem."

Regulatory restrictions and harassing litigation by environmental radicals have prevented construction of a single nuclear power plant or oil refinery in the United States for the past three decades.

Need a job?

...as Paul Craig Roberts noted earlier this year, “The problem America faces is not a lack of educated people, but a lack of jobs for educated people. In the 21st century, the US economy has been able to create net new jobs only in domestic services, such as waitresses, bartenders and health and social services. The vast majority of these jobs do not require a college education, and they do not produce tradable goods and services that could be exported or substituted for imports.”

At least part of the reason for that little problem has to do with the cost of manufacturing 'stuff' in the USA--and regulatory cost plays a BIG part in that.

There's plenty for a new Congress and President to do.

God willing, there will be LESS for regulators to do. But that's OK. They can always get jobs in restaurants and hotels.