Major regulations reviewed by the White House over the last decade have resulted in as much as $863 billion in economic benefits, with costs amounting to a fraction of that total, according to a new report from the Office of Management and Budget.
The OMB’s draft annual report to Congress analyzed the estimated economic impact of scores of rules enacted between 2003 and last year, concluding that rules subject to economic analysis yielded overall benefits between $217 billion and $863 billion.
The study estimated costs for those rules at between $57 billion and $84 billion, according to the report.
The findings buoy the arguments from proponents of stronger public safeguards, said Amit Narang, a regulatory policy advocate at Public Citizen.
“The new numbers show, as they do every year, that our federal regulatory agencies deliver one of the best returns on investments in terms of public health and safety benefits,” Narang said. “This is likely why critics of environmental, health and safety standards continue to downplay or completely ignore the enormous benefits of these measures."
Fiscal 2013 saw a significant drop-off in both costs and benefits associated with major rules, generally those with an economic impact of $100 million or more, according to the report.
The White House estimates regulatory benefits totaling up to $67 billion last year, with costs around $2.5 billion. As noted in an analysis of the report put together by The George Washington University’s Regulatory Studies Center, the 2012 report estimated around $115 billion in benefits and $20 billion in costs.
The drop-off in fiscal 2013 can be attributed, at least in part, to election year politics in the late 2012, according to the conservative American Action Forum.
“The first quarter of FY 2013 occurred during the election season in 2012, so there might have been an impetus to delay a few controversial rules,” the think tank’s analysis of the report said.
An independent government report released in December agreed, finding politics at play in the delay of many regulations in 2012.
American Action Forum also argued that the new OMB report includes only a small number of the hundreds of federal rules enacted last year.
“Obviously, OIRA’s [the Office of Information and Regulatory Affairs] tally is a small fraction of total federal rule-making, but the administration will claim that the report captures a ‘vast majority’ of costs and benefits,” the group found.
The report, required under federal law, examined 54 major rules.
Yet its authors strongly emphasized its limitations.
“Many rules have benefits or costs that cannot be quantified or monetized with existing information, and the aggregate estimates presented here do not capture those non-monetized benefits and costs,” the report found. “In some cases, quantification of various effects is highly speculative.”