Job-Creators: Regulatory Uncertainty Stunts Job Growth

February 11, 2011

Will House Democrats Continue to Defend Regulatory Roadblocks to Recovery?


The House today is considering a measure to order a comprehensive review of federal regulations. This effort follows the House Oversight and Government Reform Committee’s publication of nearly 2,000 pages of letters from job creators detailing how onerous regulations substantially increase the cost of doing business, which hurts economic growth.


One employer trade association explained how regulations proposed by the Obama administration are creating uncertainty and stalling economic growth:



“The size, scope, and cumulative burden of current impending regulatory activity is creating significant uncertainty and could, if left unchecked, threaten the continuation of a substantial portion of domestic refining and petrochemical production and well-paying existing American jobs, and the security of the nation…”


“Formosa Plastics, an NPRA member company located in Texas recently sent the Texas delegation a letter detailing the impact of uncertainty associated with EPA’s GHG regulations. Formosa has been planning a $1 billion expansion of its operations in Point Comfort, Texas. The expansion would create between 700 and 800 construction jobs, 357 service jobs and another 125 full time industrial operations and maintenance jobs. Formosa noted that the uncertainty associated with EPA’s GHG regulations will effectively ‘kill these pending new U.S. based manufacturing projects’.” (Charles T. Drevna, National Petrochemical and Refiners Association, Letter to House Oversight and Government Reform Committee Chairman Darrell Issa, 1/10/2011)


Other groups explained how uncertainty over regulatory implementation has harmed economic growth by increasing compliance costs, creating confusion and limiting access to the credit markets:



When new regulations are proposed or implemented, they create much uncertainty among chemical manufacturers, especially small companies. The more they spend complying with regulations, the less they have available to spend on conducting critical research and development activities to develop innovative products that help companies expand their businesses.” (Jay Timmons, National Association of Manufacturers, Letter to House Oversight and Government Reform Committee Chairman Darrell Issa, 1/7/2011)



“Following the passage of Health Reform, six interim final rules were published in a little over two months. This may be perhaps the most troublesome, extensive and broad reaching example of the subversion of appropriate regulatory procedure…. Although the corrections and delays are better than inappropriate rules and unattainable deadlines, they create further uncertainty and confusion as employers struggle to remain informed and compliant as to current legal responsibilities and regulatory requirements.” (William L. Kovacs, U.S. Chamber of Commerce, Letter to House Oversight and Government Reform Committee Chairman Darrell Issa, 12/29/2010)



One key factor in housing’s current depressed state has been continued confusion and roadblocks in the banking community over the issue of Acquisition, Development and Construction (AD&C) lending. The lack of lending has stymied the recovery of our industry and scores of others … Our members have run around on a hamster wheel on the question of whether federal banking regulators are pressuring the banks not to lend, whether the local examiners are ‘acting rogue against the wishes of DC chiefs,’ or if the institutions are overhauling and downsizing portfolios independent of regulator/examiner pressure” (Joseph M. Stanton, National Association of Home Builders, Letter to House Oversight and Government Reform Committee Chairman Darrell Issa, 1/20/2011)


Meanwhile, Minority Leader Nancy Pelosi says that the debate over regulations is “filler”—just a waste of time. How much longer will Pelosi and other House Democrats continue to ignore American job creators about how to fix the economy?


“Instead of focusing on job creation, this congress is spending ten hours on the floor, a filler, as concrete evidence of the fact that they have nothing else to fill the time with, directing our committees to conduct oversights.” (Remarks by Minority Leader Nancy Pelosi, 2/10/2011)