Bravo, President Barack Obama, for issuing an executive order to review and remove burdensome regulations on business.
We should follow the president’s example in California.
In a Wall Street Journal editorial this week, the president stated that he signed an executive order for regulation review because outdated regulations stifle job creation and make our economy less competitive. The president wrote, “we are also making it our mission to root out regulations that conflict, that are not worth the cost, or that are just plain dumb.”
The order requires government agencies to consider benefits and costs of regulations and to seek expert advice about regulations, including input from the business community.
The president’s order comes on the back of California congressman Darrell Issa’s letter sent to business leaders asking for a list of onerous regulations on their businesses. Issa is acting in his new role as Chairman of the Oversight and Government Reform Committee. Like the president, Issa is concerned with regulations hampering job creation.
In his article, the president highlighted burdensome regulation on small business. “Small firms drive growth and create most new jobs in this country. We need to make sure nothing stands in their way,” he wrote.
As my generation used to say: “Right on!”
According to a 2010 study for the Small Business Administration, complying with federal regulations cost companies with fewer than 20 employees an average of $10,585 a worker, compared with $7,755 an employee for large companies.
California law can jack the cost of regulation on business even higher. The governor and legislature should order a review of California regulations to see what can be reduced or discarded.
Changing regulations will not be easy. As with the federal level, it is likely that many of the regulations that have a great impact are involved with environmental rules. There is strong resistance to change any environmental regulations.
How aggressive the federal bureaucracy will be in following
through on the president’s order is yet to be seen. But, it is a good sign for
job creation and the economy that the president has requested a look at
regulations.
With all the federal attention focused on business
regulation, this would be a perfect time for California to follow suit and help
clear the underbrush of regulations and open the door to more job creation,
which in turn will help the state budget’s bottom line.
UPDATE : Today, Senate Pro Tem Darrell Steinberg called for a review of regulations that hinder business. According to the Sacramento Bee, Steinberg said: "We need to do a whole lot better in providing a friendlier business
climate."
Read more here.