Spurred on by steady increases in staffing and spending within the Department of Homeland Security (DHS), the U.S. government is budgeting yet another increase in the amount of tax money it spends on federal regulatory activities, according to an annual regulatory spending analysis compiled by the Weidenbaum Center on the Economy, Government, and Public Policy at Washington University in St. Louis and the Mercatus Center at George Mason University.
Federal regulatory agencies will spend $46.6 billion of U.S. taxpayers’ money in 2008, an inflation-adjusted increase of $1.7 billion over the 2007 budget. In addition, the number of regulatory employees will pass the quarter-million mark, with a 3% increase over 2007’s estimated 244,210 employees, according to the study, “Growth in Regulation Slows: An Analysis of the U.S. Budget for Fiscal Years 2007 and 2008.”
“Despite the spending restraint evident in the 2008 budget request, regulatory expenditures and staffing are significantly larger in 2008 than they were in 2000,” concludes study co-author Melinda Warren of the Weidenbaum Center.
Driven largely by homeland security activities, staffing levels in 2008 are 43 percent larger than they were in 2000. The budget calls for expenditures that are 51.8 percent higher than in 2000 — an increase in real spending on regulatory activities of $13.2 billion between 2000 and 2008, the study finds.
Co-authored this year with Jerry Brito, a senior scholar at the Mercatus Center, the study is the latest in a series of annual reports that have tracked changes in spending and staffing within federal regulatory agencies over the last 30 years. The current study shows that homeland security activities now account for about half of all federal regulatory expenditures.
In 2008, the DHS is slated to receive 45.5% of the regulators budget, or more than $21 billion. And DHS will employ more than half of the federal regulatory workforce, with 133,059 employees – up 5.3% from 2007. This is a trend that continues from the 2006 edition of this report and is mainly attributable to growth in agencies responsible for immigration, customs and border protection.
“While several agencies within the Department of Homeland Security are slated for budget cuts in 2008, the U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement each face large increases in personnel,” notes Warren.
Although taxpayers may wince at the thought of $46.6 billion allotted annually for federal regulatory spending, Brito points out that this is only a fraction of the real cost of federal regulations. Citing a 2005 study by the Small Business Association, he says: “In terms of lost output, federal regulations cost the U.S. economy $1 trillion each year, or $8,000 per household.”
The Mercatus Center at George Mason University is a research, education, and outreach organization that works with scholars, policy experts, and government officials to connect academic learning and real world practice. The mission of Mercatus is to promote sound interdisciplinary research and application in the humane sciences that integrates theory and practice to produce sustainable solutions that advance a free, prosperous, and civil society.
The Weidenbaum Center on the Economy, Government, and Public Policy at Washington University in St. Louis supports scholarly research, public affairs programs, and other activities in the fields of economics, government, and public policy, serving as a bridge between scholars and policy makers.