Campaign launched to clip feds’ regulatory wings

With an idea and $5,000 saved from a small business they owned, two brothers developed a new product that few people wanted and no customers bought for nearly a dozen years. But once proven, Orville and Wilbur Wright’s heavier-than-air-machine launched one of the world’s greatest industries. 

Luckily for them and the world, they didn’t have to wrestle with the massive federal regulatory nightmare that entrepreneurs face today. It stifles innovation, grinds small businesses down and prohibits job creation that could restore fiscal certainty to America. 

More than other segments of the economy, small businesses are struggling. They not only must contend with customers who are hesitant to spend, costs that continue to rise and taxes that are unbalanced, but they are tripped at every turn by government rules from dozens of agencies that probe excessively into every corner of their enterprises. 

After decades of pleading for regulatory relief, the National Federation of Independent Business is taking its fight against runaway rules to a higher level. It has launched a new campaign, Small Businesses for Sensible Regulation, to target the new flood of regulations being forced on small firms by President Obama’s administration. 

Chaired by former U.S. Sen. Blanche Lincoln of Arkansas, the campaign will work to ensure that the administration seriously considers the long-term impact of federal regulations on small-business jobs, economic growth and the additional costs generated by the regulatory process. 

In just the past five years, major federal regulations — those with impacts of $100 million or more — have jumped 60 percent. Now there are more than 4,000 active rules on the books, 845 specifically affecting small businesses. Complying with those is incredibly costly for small firms. According to the U.S. Small Business Administration, the annual tab to mind federal rules for companies with fewer than 20 employees averages $10,585 per worker. 

Few agencies are more costly to obey than the Environmental Protection Agency whose mushrooming file of decrees has spread from 1,000 pages in 1976 to more than 25,000 pages today. Often the bane of small businesses for its nitpicking, EPA compliance costs for small firms is 364 percent more than those paid by bigger businesses. Even the IRS is not quite as expensive to comply with, yet small businesses typically pay 206 percent more than larger firms to meet its requirements. 

Now that Congress has grown accustomed to debating about trillions of dollars, NFIB’s campaign to inform lawmakers that the cost of federal regulations exceeds $1.7 trillion a year should get their attention. The burden exceeds by half the private spending on health care. 

In the coming months, the organization will share the personal stories of small-business owners and their employees who represent the human costs of keeping Washington’s heavier-than-the-nation-can-afford regulatory machine flying high. 

Freed of the weight of unnecessary federal regulation, small business could once again be the wind beneath the wings of the nation’s economy and new entrepreneurs like the Wright Brothers could dare to develop world-changing ideas that can take off.

Dan Danner is president and CEO of the National Federation of Independent Business, which represents 350,000 small-business owners in Washington, D.C. and every state capitol.