Investing in our Regulators

President Obama’s Budget should generally reflect our national priorities.  Based on his Fiscal Year (FY) 2012 request, the President thinks the nation needs more regulators and higher taxes.
 
EPA’s Explosive Growth Nets New Funding for CO₂ Regulation
 
Some budget hawks might be pleased with the proposed reductions in EPA funding.  However, the real story in the President’s Budget is the massive increases since FY 2009. 
 
In addition to receiving $1 billion more since FY 2009, the EPA was the recipient of more than $7.2 billion in Stimulus funds.  Thus from FY 2008-2010 alone, the EPA’s budget increased 130.8 percent, according to the House Budget Committee.  And though there are some cuts to the FY 2012 request, there are massive increases to the most dangerous parts of the EPA’s regulatory scheme.
 
For example, the Administration quickly learned that a country can’t regulate greenhouse gases (GHG) without regulators.  To that end, the Budget adds $46 million to implement the new GHG reporting and permit programs.
 
President Increases Number of Financial Regulators
 
With the passage of Dodd-Frank financial reform in 2010, businesses have been preparing for the onslaught of new regulations, up to 243 according to some experts.  Now, the President has started to implement the legislation and it arrives with a steep price tag.
 
The Commodity Futures Trading Commission, the agency primarily responsible for implementing Dodd-Frank, received a 45 percent hike in spending.  In addition, the regulatory demands of Dodd Frank apparently necessitate 534 new Commission employees.  During the past two years, employment at the Commission has grown by more than 62 percent.
 
Under this Budget, financial reform couldn’t be labeled a success without new taxes.  The President obliges, with a “user fee” on market participants.  This transaction tax is slated to bring in $117 million. 
 
100,000 IRS Agents?
 
Raising taxes, implementing Dodd-Frank and a massive new health care overhaul will of course place demands on the Internal Revenue Service.  The President meets those needs by adding more than 5,100 IRS agents to monitor tax compliance and prosecute American taxpayers. 
 
Actual IRS spending is slated to increase by more than $1 billion over FY 2010 totals, or 9.3 percent.
 
Overall, there has been dramatic growth in the number of full-time employees of the Executive Branch.  From FY 2009-2012, the number of full-time employees has increased by 138,000, or 6.9 percent, even as private-sector employment has fallen by 914,000 since 2009.
 
To defend the President against his critics, he does have a jobs program; it’s just for federal regulators.
 
Click here for more background on the President’s 2012 budget from the American Action Forum.