Regulatory Budgeting: Not Ready for Prime Time
Under current law, regulatory costs are neither accounted for, nor limited, by any of the budgeting tools available to Congress. Some policymakers would like to change this by establishing a “regulatory budget” for the costs of red tape. They argue that such a budget would force Congress to take responsibility for regulatory costs and encourage regulators to prioritize regulatory activity. Although these goals are laudable, achieving them would be difficult or impossible. Estimates of regulatory costs are notoriously imprecise. Moreover, the process would be vulnerable to gaming by those intent on pursuing institutional or personal agendas. Regardless of whether a regulatory budget is adopted, there are a number of reforms consistent with the goals of its supporters’ proposals that should be considered. Among these: expanding cost-benefit analysis to independent agencies and improving congressional regulatory analysis capabilities.