House Republicans have pushed through their latest plan to chip away at the country’s stubbornly high rate of unemployment — this time, taking direct aim at government regulations.
On a largely party-line vote, the House on Thursday passed the Red Tape Reduction and Small Business Job Creation Act, which would prevent federal agencies from imposing any major new business regulations until the unemployment rate drops back to 6 percent. The moratorium would allow for certain emergency regulations, but even those could be challenged in court.
The bill would also prevent an outgoing president from implementing new federal rules between the election and subsequent inauguration.
“As the economy continues to sputter, it is important to ensure that the nation’s biggest job creators are not strapped with punishing new rules,” Susan Eckerly, a public policy expert for the National Federation of Independent Business, said in response to the bill’s passage.
Thursday’s proceedings didn’t come without an added bout of political squabbling, as lawmakers spent much of the morning aruging over whether to simply correct two typos included in the legislation.
Republicans stumping for the bill have pointed to Small Business Administration estimates that regulations cost employers $10,000 per employee every year. More than three out of four small business owner also said government regulations are stopping them from hiring.
“The best way for Washington to address our unemployment crisis is to help small businesses grow,” Rep. Sam Graves (R-Mo.) said in a statement, later suggesting the bill creates an “environment for growth” both by providing a sense of clarity with regards to the rules governing each industry and by freeing up capital business owners can use to hire and expand their enterprises.
However, Bureau of Labor Statistics data show that employers attributed far fewer layoffs during the first half of the year to burdensome regulations (1,119) than sluggish demand (144,746). Critics have used the findings to suggest the deregulation bill would have little impact on employment decisions.
One economist who worked under Presidents Ronald Reagan and George H.W. Bush went so far as to call the connection between regulations and unemployment “nonsense.”
Either way, the measure has little hope in the Senate but continues to frame each party’s main arguments heading into the elections. Republicans have repeatedly blamed their political rivals for placing government impediments in the way of business growth, while Democrats hope to convince voters that their counterparts are slowing the economic recovery by holding middle-class tax relief hostage until they can extend cuts for the nation’s wealthiest individuals.
The latter is playing out right now in the Senate, where Democrats on Wednesday approved a measure extending tax breaks next year for the middle-class but allowing them to expire for those earning annually more than $250,000. Republicans remain firm in their committment to extend the cuts for all Americans, setting the stage for what’s become known as the looming “Taxmageddon.”