1.75 Trillion or 10% of US Economy Spent on Federal Regulations

And that is just the cost to businesses… not the gargantuan budget for the government.

The Small Business Administration Office of Advocacy estimates that it costs Americans $1.75 trillion to comply with federal regulations each year.  To put $1.75 trillion into perspective, that amount is larger than all but eight economies in the world.  It also means that over 10% of the U.S. economy is spent on trying to satisfy rules issued by Washington bureaucrats. That doesn’t even include federal, state, and local taxes.

Add the 3.8 trillion budget monster that Obama just brought us and we’re looking at over 5.5 trillion a year being eaten up by the government. And those are just direct costs.

The indirect costs go much deeper and higher. It’s hard to add up the cost of the money swallowed up by government bureaucrats and their non-profit allies. Money that is not spent paying workers or expanding businesses. Money that in some cases leads to businesses going out of business and workers losing their jobs. Money that encourages businesses to pack up and go do business in a country where it is cheaper and easier to do business.

There’s no way to calculate all that but we can compare the booming America of Eisenhower to the declining America of LBJ and Carter and finally the decrepit welfare state of Clinton and Obama held up by dirty financial industry crony capitalist gimmicks and desperate dot com development that ends up making it cheaper and easier for China to export more to the United States.

American business has been strangled by government. And the government anaconda isn’t done.


  • http://www.adinakutnicki.com AdinaK

    Indeed, in order to control (and destroy) capitalism one must regulate it into oblivion. How many times does this truth need to come to the fore, before enough people understand what is happening?

    Hyper-regulation is of piece with anti-capitalist regimes – http://adinakutnicki.com/2012/08/07/barack-hussei

    Adina Kutnicki, Israel http://adinakutnicki.com/about/

  • Spikey1

    Think of all the stimulated economy that 1.75T buys; law writing jobs, regulator jobs, inspectors, the printing of regulations all the way down to the people that cut down trees and sweep floors.

    This is just like an individual walking down the street throwing rocks and breaking windows, all those windows will need to be replaced and by someone – stimulating the economy.

    Do I really need to say it? /SARC/

  • Watermelonbeast

    This year I actually spent over 10 percent of my business tax return preparation fees having my accountant create 1099's the he issued to himself. Isn't the government great!!. This requirement was supposed to go away after the uproar about the 1099 requirements early in 2012 but they found another law by which to impose it. Just another example of how no regulation, requirement, or tax is every really repealed by government.

    I believe that compliance costs and the uncertainty over Obamacare accounts for at least a .5 to 1 percent reduction GDP growth.

  • theccur

    Tax, regulate, spend and give away. The DESTRUCTION of the U.S. economy proceeds apace.