The
cliff we all hear about is the fiscal cliff: the upcoming expiration of
the Bush tax cuts and the simultaneous slashing of government spending.
But there is another cliff that Obama has created: the regulatory
cliff-the likelihood of a vast expansion of regulations that will throttle growth and slash jobs if Obama wins a second term.
Jim McTague writes in Barron's:
Jim McTague writes in Barron's:
A pending "regulatory cliff" also is contributing to dizzying uncertainty that has put the brakes on major investment decisions and, consequently, hiring...
The CEOs are keeping the other wary eye glued to the Federal Register, where final rules from government departments and agencies are announced and published after passing through the bureaucratic pipeline. Post-election, the Environmental Protection Agency alone could wreak havoc on the economy with a flood of new mandates that will cost businesses hundreds of billions of dollars. According to Bill Kovacs, senior vice president for the environment, technology, and regulatory affairs at the U.S. Chamber of Commerce, there were 620 rules in the EPA pipeline three years into the Obama administration, versus 412 in the pipeline three years into the Bush administration. That's a 50% increase. What's more, some of the rules are "really big," says Kovacs.
"Think of how much of a change these 620 proposals might represent," he says. "It makes it difficult to engage in a planning cycle. What equipment do you use? How exactly do you build it to comply with changing regulations? How do you amortize the cost of using it?"
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