A few weeks ago, Job Creators Network lauded Canada for enshrining into law the Red Tape Reduction Act, whereby policymakers are required to remove one government regulation before adding another regulation to the books.
Our own lawmakers should mimic the Canadians’ practice to rein in our own regulatory regime that now costs Americans $1.88 trillion in lost economic productivity and higher prices each year – $14,976 per household, more than the average family spends on health care, food and transportation.
Sunset provisions are expiration dates on laws or regulations that force a review of the rules’ worth.
On the books since 1977, the Texas Sunset Act mandates “that every state agency be abolished by a specific date” unless lawmakers pass a bill to continue it. And that cannot be done unless the “Sunset Advisory Commission” says it’s okay. And that cannot happen until after public hearings and other review.
And, according to the Competitive Enterprise Institute, when the sun goes down on Texas agencies, Texans have a fiscally brighter day – over a 29 year period so far the process has:
*Abolished 78 state agencies
*Saved $945.4 million
*Cost taxpayers $32.8 million – a $29 return for every dollar spent.
The benefits go beyond just getting rid of useless agencies or regulations. Sunset provisions can make government agencies more efficient, for example, resulting in the merger of two agencies serving similar purposes, and much more accountable than they might otherwise be.
- Creating agencies without sunsets all but ensures their immortality.
“When an agency is established without an expiration date, it is almost impossible to abolish. Take Fannie Mae and Freddie Mac, the housing giants. They were established as quasi-governmental entities in 1938 and 1970, respectively.” And the government financial duo have existed as “zombies” for the past seven years – living in a strange legal-financial limbo called a conservatorship.
- Enacting policies without sunsets strengthens the executive branch and weakens Congress.
“Presently, there are about 120 executive agencies that collectively spend nearly $3.5 trillion per year. Congress cannot oversee all this activity, which leaves the executive branch an increasingly free hand. If more legislation had sunset dates, the growth of government might be slowed or even reversed.”
- Sunsets force Congress to conduct oversight and consider whether a policy is worth keeping.
“Oversight is hard work. With so many other tasks to tend to (running for reelection, raising money, etc.), Congress does it less often than it should. Sunset provisions encourage oversight and establish accountability. As the expiration date approaches, legislators are forced to ask whether a given policy should be continued.”
Around two dozen other states have some version of a sunset provision, with varying degrees of teeth and success. But as Texas has shown, stamping an expiration date on laws and government agencies is not only possible, but is effective.
Job creators are hesitant enough under the country’s burning regulatory sun. We need to put some of our outdated, expensive regulations to bed. For good.