Washington just doesn’t seem capable of connecting the dots on the inverse relationship between over-regulation and small business job creation. When you consider that small businesses create two-thirds of new jobs, it also becomes clear why new job creation has been lethargic at best.
Whether it’s confiscating their property, forcing them to post pro-union propaganda or micro-managing the operation of their swimming pools, our friends from the federal government are always “here to help” small business when it comes to regulatory over-kill.
In fact, a 2010 Small Business Administration study shows small businesses pay 36 percent more to comply with federal regulations than their larger counterparts, at an average cost of $10,585 per employee. This cost does not include state or local regulatory burdens. Small businesses currently bear a disproportionately high cost, compared with larger businesses, to comply with federal regulations.
An August 2012 “Small Business Problems and Priorities” research paper conducted by the National Federation of Independent Business found that out of the 75 business problems assessed in the report, “Unreasonable Government Regulations” ranked as the fifth most serious concern.
If the Obama Administration and Congress are serious about creating jobs, then they need to start getting serious about reeling in the regulatory tidal wave gushing out of Washington before the nation’s small business sector is swept away.
A good start would be the passage of The Regulatory Flexibility Improvements Act of 2013, a regulatory reform bill designed to give small businesses more say in the federal regulatory process. The goal is to create better regulations that meet agency goals while minimizing burden and cost on small businesses. This bipartisan measure was introduced by Reps. Spencer Bachus, Sam Graves, John Barrow and Jim Matheson on June 27.
It would require all agencies, including independent agencies, to hold panels with small business owners on rules with significant impact on small businesses to get feedback on what the agency wants to regulate and how they could minimize burden. By getting this feedback before a rule is proposed, the agency can develop the best rule possible.
This was the idea behind a currently existing law – The Small Business Regulatory Enforcement and Fairness Act (SBREFA) – but agencies like OSHA and EPA have been successful in side-stepping the requirements and cutting small business out of the process. The bill would halt these agency “end runs” around the intent of the SBREFA law.
Steps like these have worked in Michigan and they will work at the federal level if they are given the chance.
Go HERE for more information on federal over-regulation of small business.