An Analysis of the Seventh Government Report on the Costs and Benefits of Federal Regulations

The Office of Management and Budget (OMB) has just released a draft of its seventh annual report to Congress on the costs and benefits of federal regulation. The law requires that OMB submit a report to Congress that provides estimates of the costs and benefits of federal regulation. The report is also supposed to make recommendations for reform, provide guidelines for agencies to standardize benefit and cost estimates, and assess the impact of federal regulation on State and local government, small business, wages and economic growth. The 2004 OMB draft report improves upon earlier reports in two ways. It explores regulatory reform worldwide and discusses the costs of regulation on the manufacturing sector. OMB’s focus on the manufacturing sector, however, is unduly narrow. It should focus on reforming regulations in other sectors as well, such as agriculture and services. Unlike last year’s report, this year’s draft report does not list homeland security regulations by agency or provide useful summary information on OMB’s regulatory oversight activities, such as return letters and prompt letters. Our analysis of earlier reports suggested ways that OMB could improve its annual report. OMB has yet to implement some of these recommendations, so we have included some of them in this year’s analysis.

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