Regulators’ Budget from Eisenhower to Obama

Regulators' Budget
by Susan E. Dudley & Melinda Warren
May 17, 2016

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This report is a joint effort of the Weidenbaum Center on the Economy, Government, and Public Policy at Washington University in St. Louis and the George Washington University Regulatory Studies Center in Washington, D.C.

The Weidenbaum Center on the Economy, Government, and Public Policy at Washington University in St. Louis supports scholarly research, public affairs programs, and other activities in the fields of economics, government, and public policy, serving as a bridge between scholars and policy makers.

The George Washington University Regulatory Studies Center raises awareness of regulations’ effects to improve regulatory policy through research, education, and outreach. It is a leading source for applied scholarship on regulatory issues, and a training ground for current and future policy officials who want to understand the effects of regulation and ensure that regulatory policies serve the public interest.

Publications are available from either center at the following addresses:

Weidenbaum Center on the Economy, Government, and Public Policy
Washington University
Campus Box 1027
One Brookings Drive
St. Louis, MO 63130-4899
Telephone: 314-935-5652
Fax: 314-935-5688
http://wc.wustl.edu

The George Washington University Regulatory Studies Center
805 21st St, NW, Suite 612
Washington, DC 20052
Telephone: 202-994-7543
Fax: 202-994-6792
www.RegulatoryStudies.gwu.edu

 

Regulators’ Budget from Eisenhower to Obama

An Analysis of the U.S. Budget for Fiscal Years 1960 to 2017

Highlights

This report provides a measure of regulatory activity from 1960 to 2017 by tracking the budget outlays and staffing devoted to developing and enforcing federal regulations.

In the final year of the Dwight D. Eisenhower administration (FY 1960), regulatory agencies employed a little more than 57,000 people and spent $533 million (equivalent to $3 billion in 2009 dollars). President Barack H. Obama recently submitted his final budget to Congress. It proposes expenditures of $70.0 billion ($61 billion in 2009 dollars) on regulatory activities in FY 2017, and a staff of almost 279,000. In the 58 years tracked in this report, fiscal outlays for administering regulation have increased more than 20-fold (after adjusting for inflation) and staffing has increased by a factor of five.

In real, inflation-adjusted terms, President Obama’s FY 2017 regulators’ budget is 8.9 percent higher than in FY 2016.[1] The Budget also requests increases in federal regulatory agency personnel of 1.9 percent in FY 2017, after an estimated 2.9 percent increase in FY 2016.

Since President Obama’s first budget, the regulators’ budget has increased by 18.8 percent in real terms, and staffing has increased by 8.4 percent.[2] This is significantly less than the 54.4 percent growth in outlays and 51.4 percent increase in personnel during President George W. Bush’s term.[3]

In Eisenhower’s day, 34 percent of the regulators’ budget was devoted to economic forms of regulation (controlling price and quality, entry and exit), while the remainder addressed social regulatory issues (related to environment, safety and health). Over the 58 years since then, outlays for economic regulatory programs have grown, but at a much slower rate than those for social regulatory programs (a factor of 11, compared to a factor of 25). Personnel in economic regulatory agencies is 2.5 times greater than in 1960, while staffing at social regulatory agencies is six times larger. By 2009, only 15 percent of the regulators’ budget focused on economic regulation.

This trend away from economic regulation appears to be changing, as the bulk of the increase during President Obama’s two terms accrued to agencies engaged in economic regulation; their outlays in FY 2017 are expected to be 40.0 percent larger than FY 2009 levels. The social regulatory agencies’ budgets have grown 14.9 percent between 2009 and 2017. Staffing at economic regulatory agencies has increased by 30.1 percent, while employment at agencies involved in social regulations has increased by 5.0 percent.

     

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[1]   In this section, growth is expressed in real (inflation-adjusted) terms and dollar figures are expressed in real 2009 dollars.

[2]   From President Obama’s first budget in FY 2010 to his requested FY 2017 budget, inclusive.

[3]   An important caveat is that these percentages do not include the Affordable Care Act, as noted in the Background section of this report.