Over at the Center for Progressive Reform, Ben Somberg
writes:
It's their favorite figure: $1.75 Trillion. Repeated ad nauseam in congressional hearings by members of congress and expert witnesses alike, it is the supposed annual cost of regulations, this according to a study from last year commissioned by the Small Business Administration's Office of Advocacy. Sponsors of anti-regulatory legislation like the number: Olympia Snowe and Tom Coburn included it in the 'findings' of their bill, while Geoff Davis, chief sponsor of the REINS Act, cites it regularly. It's been used by John Boehner and Eric Cantor, and House committee chairs Fred Upton, Darrell Issa, Lamar Smith, and Sam Graves. Conservative think tanks like the Competitive Enterprise Institute and the Heritage Foundation are fond of it. A few Democrats have gotten in on the act, too: Mark Warner, proponent of his own anti-regulatory plan, has cited it, as has Nydia Velazquez, Ranking Member of the House Small Business Committee.
The SBA-commissioner study by Nicole V. Crain and W. Mark Crain was, it seems, a ready-made tool for the crew who would like to take us back to 1925 on everything.
Just one problem. Their work is riddled with methodological errors and omissions, according to CPR's analysis. But if you're not willing to take the word of an organization with "progressive" in its name, the non-partisan Congressional Research Service has released its own report, Analysis of an Estimate of the Total Costs of Federal Regulations [29-page pdf]. Here's a sample from the summary of what CRS found:
...Crain and Crain’s estimate for economic regulations (which comprises more than 70% of the $1.75 trillion estimate) was developed by using an index of “regulatory quality.” One of the authors of the regulatory quality index said that Crain and Crain misinterpreted and misused the index, resulting in an erroneous and overstated cost estimate. ...
Crain and Crain’s estimates for environmental, occupational safety and health, and homeland security regulations were developed by blending together academic studies (some of which are now more than 30 years old) with agencies’ estimates of regulatory costs that were developed before the rules were issued (some of which are now 20 years old). Although the agency estimates were typically presented as low-to-high ranges, Crain and Crain used only the highest cost estimates in their report. The Office of Management and Budget has said that estimates of the costs and benefits of regulations issued more than 10 years earlier are of “questionable relevance.” ...
Crain and Crain said they did not provide estimates of the benefits of regulations, even when the information was readily available, because the SBA Office of Advocacy did not ask them to do so. OMB’s reports to Congress have generally indicated that regulatory benefits exceed costs. Crain and Crain said their report was not meant to be a decision-making tool for lawmakers or federal regulatory agencies to use in choosing the “right” level of regulation.
They should be happy. Their report isn't being used as a decision-making tool to pick the right level of regulation. It's being used as propaganda by those whose goal, after you peel away all their boilerplate nonsense about unfair competitive advantage and "voluntary compliance," is to dismantle or defund every regulatory effort the government engages in, from food inspections to safety-on-the-job requirements. And you can rest assured that they will ignore the CRS report's debunking.