Posted on 07/08/2019 10:33:59 AM PDT by Liberty7732
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The White House’s Council of Economic Advisers recently studied 20 regulations that were either repealed by the administration, or are opposed and may be repealed.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.
Free Market Health Care PAC The Revolutionary Act supports the work of the Free Market Health Care PAC 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.
Deregulation is YUGE as a factor in the economy. Little heard is the elimination of pernicious laws, rules and regulations under Trump. Even the EPA has been downscaled by 1/3.
Time to deregulate the 20,000 Unconstitutional ANTI Gun Laws on the Books.
Thanks for posting this.
Deregulation is indeed helpful for economic growth.
Trump understands economy.
Cutting taxes and having massive deficit spending isn’t special or good for the long run.
From my perspective, Trump’s biggest contributions to the economy of this country have been his infectious optimism and unapologetically pro-American attitude. Everything else just naturally follows.
The article does not tell us what they are, which would be useful.
Cutting tax rates is one thing, and cutting tax revenue is another.One thing to say that deficit spending is bad - but the reason to oppose a “balanced budget amendment” is that it would be an engine not for reduced spending but for increased tax rates. But tax revenue is a nonlinear function of tax rate; the Laffer Curve describes a real phenomenon.
For the capital gains tax in particular, the relationship is highly nonlinear. Capital gains are voluntary, so capital gains tax revenue is voluntary. People are naturally reluctant to realize capital gains when the tax rate is high. And are especially reluctant to pay tax on nominal gains due to inflation, when the reality is a loss in real purchasing power. And that is on top of the fact that if you create a business and sell it, your capital gain reflects the buyer’s estimate of the present worth of future profit from the business. So the capital gains tax is a tax on prospective future income which itself will be taxed as regular income when. as, and if it materializes.
Jack Kemp described Bob Dole as “the tax collector for the welfare state” - precisely for the naive “if one’s good, two’s twice as good” theory of taxation. You want a revival of that??? No sale here.
Cutting taxes and cutting spending is a solution. But, at this rate there is no appetite toward solving problems. Goosing the economy like this only serves short term thoughts. The rich can always leave, but ‘we’ are stuck with this massive spending and debt. Obama was rightly attacked for having massive deficits, the ‘right’ has shut up on such concerns.
You make better the enemy of good enough.Trump has been deregulating the economy as fast as he can. And that includes getting the tax rate down. The result is a good economy. Trump wants a few billion dollars for a wall. Chump change in the context of a trillion dollar budget. And, it is something which is needed, in the sense that “if you need something, you pay for it whether you buy it or not.” But you cry, “deficit spending!”
Perhaps you are too young to remember the 40 years in the wilderness between 1955 and 1995, during which time the Democrats controlled the House continuously. What was going on? The Democrats would spend, and the Republicans would complain about the deficit - then raise tax rates to try to close the deficit. The Democrats were therefore Santa Claus, and the Republicans were the Grinch. Which is why Jack Kemp called Bob Dole “the tax collector for the welfare state.”
Kemp’s solution was direct, but counterintuitive. He demanded tax cuts, and refused to consider any argument against them based on the idea that they would increase the deficit. To be an effective conservative in the context of Santa Claus Democrats is to be willing to play “Chicken” with the deficit. It’s either that, or raise taxes past the point of negative returns - and go back to the “good old days” of the Carter Stagflation (which, to be fair, was building during the Nixon-Ford years).
Remember, Senator Obama inveighed against the deficit during the Bush Administration. Then took office, and doubled the national debt. Inveighing against the deficit is easy. Even people who want to destroy the credit-worthiness of the country can do it.
Trump will double the debt at this rate as well. The eoconomy is being fueled by this massive goverbment spending and low interest rates. Rates should be higher. Trump is wanting to continue to have low rates to fuel the asset bubble. Death to savers will continue at this rate. The youth will continue to suffer under such strains created by R and D spending. I want a wall, that is chump change compared to the spending problems we have, that is not the obvious spending problems we have or the problems we both know need fixing.
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