Mr. President: It is often said that there are two constants in life – death and taxes – but I would like to add one more for consideration – regulations. We often talk about the threat America’s growing debt poses to our economy and our future – but the growth in federal regulations also poses a serious threat to our nation’s long-term economic growth and job creation.
According to the Congressional Budget Office or CBO, the potential growth rate of our economy (or that rate of growth that is possible given the education of workers, the quality of capital equipment, and the business formation rate) averaged 3.3 percent for the period 1950 through 2014. However, CBO expects that annual rate to fall to 2.1 percent or the period 2015 through 2025. That’s a 36 percent reduction in the potential growth rate of the economy.
Why is this so critical? According to the President’s own Office of Management and Budget, a 1 percent increase in the economy’s growth rate will yield more than $400 billion in new revenues to the government. But when that growth rate falls, when we grow more slowly than we could and aren’t meeting our full potential, government revenues also fail to keep up with budget projections. So what happens when the government revenue comes up even shorter in the face of growing overspending? More borrowing, bigger deficits, and expanding debt.
Senators from Western states know all too well the economic effects of regulations coming out of bureaucracy-bloated agencies like the Environmental Protection Agency. Today I want to focus not just on the impact of recent regulations on my home state of Wyoming’s economy, but the drag they are creating on our economy nationwide.
The State of Wyoming is the largest coal-producing state in the nation. Coal represents almost 40 percent of our share of electricity generation across the United States. It is abundant. It is affordable. It is stockpileable. This is an energy source that has the potential to power our country for hundreds of years, supports jobs for hundreds of thousands of people, and doesn’t put us at the mercy of unstable regimes overseas. But this administration continues to try to regulate coal out of existence.
Since 2012, two EPA rules, the mercury and air toxic standards rule and the ozone rule, are estimated to cost in the tens of billions of dollars. That’s just two rules, and doesn’t include the billions of dollars lost to thousands of more rules imposed by the EPA and other agencies every year. If all those rules weren’t onerous enough, in August, the EPA doubled down on its war on coal when it released the final rule of the Clean Power Plan. With an estimated price tag of at least $366 billion, this rule will not only devastate the coal industry by mandating unrealistic carbon reductions, it will also distress American families by causing double-digit electricity rate increases in more than 40 states (according to the National Mining Association). And the coal industry in Wyoming is feeling the impact. The coal industry and businesses that rely on it are facing higher regulatory costs at the same time as energy producers are seeing a tougher market than they have in years, which is a bad combination for economic growth and job creation.
At the end of July, Wyoming had 15 percent fewer energy industry jobs than it did a year earlier, according to the U.S. Department of Labor Bureau of Labor Statistics. Most of those lost jobs are in coal, oil, and gas and businesses that rely on them. Given that close to half of Wyoming’s GDP comes from this sector, and that nearly half of our state is federally owned and removed from development activity, we are have always been concerned about any unnecessary government intrusion on our economic livelihood.
But the impact of EPA and other federal regulations is not just hurting Wyoming’s economy and costing my state jobs. They’re a major reason why the economy nationwide is not operating at its full potential and economic growth is has been stuck around two percent since the beginning of the so-called economic recovery. The onslaught of federal regulations targeted directly at the coal industry are not just concerns, they are real threats to people’s economic livelihood, the ability to support their families, and entire communities in Wyoming and across the country.
With our $18 trillion in debt, we cannot afford to accept the notion that we’re entering into what some are calling a “new normal” of anemic economic growth. We need to help our economy reach its potential, which will help each and every American. This cannot be done if the number and cost of significant federal regulations continues to rise.
The Obama Administration continues to push federal regulations like the Waters of the U.S. rule, which significantly expands federal authority under the Clean Water Act (CWA), as well as the recent National Labor Relations Board (NLRB) rulemaking redefining the meaning of an employer. These regulations taken by themselves have the potential to impose billions of dollars in economic costs on family farms, ranches, and small businesses, while hindering the growth of America’s entrepreneurial spirit.
Over the next few weeks and months, I am going to share with my colleagues new information from leading economists that show there is a real relationship between the growth of regulations and our struggling economy. This is a relationship that is clear to the people that experience the difficulties of complying with more and more regulations that make it harder to succeed. I hope that what is clear to business owners, employees, and communities across the country can be understood here in Washington
I will share new statistics and data showing the lost income and jobs due to federal regulations; the effects of regulation on key industries, and the breakdown of how specific federal agencies are impacting our economy; and the regulatory burden the federal government has placed on hardworking Americans in economic sectors in every state.
It is crucial for lawmakers and hardworking Americans to understand the true cost of the regulations that are being issued by this administration. Shining a light on these regulations and the burden they impose on each and every American is the only way to hold government accountable and to begin the process of reining in out-of-control agencies so we can halt the flood of regulations choking our economy.
Mr. President, thank you for your time and I yield the floor.