(AP) – Is regulation strangling the American entrepreneur? Several Republican presidential candidates say so. The numbers don’t.
The anti-regulatory fervor was in evidence Tuesday night in the latest GOP debate, but rhetorical flourishes, on that and other issues, masked far more complex realities.
A look at some of the claims and how they compare with the facts.
MITT ROMNEY: “All of the Obama regulations, we say no. It costs jobs.”
RICK PERRY: Regulations “are strangling the American entrepreneurship out there.”
RICK SANTORUM: “Repeal every regulation the Obama administration put in place.”
THE FACTS: labour Department data show that only a tiny percentage of companies that experience large layoffs cite government regulation as the reason. Since Barack Obama took office, just two-tenths of 1 per cent of layoffs have been due to government regulation, the data show.
Businesses frequently complain about regulation, but there is little evidence that it is any worse now than in the past or that it is costing significant numbers of jobs. Most economists believe there is a simpler explanation: Companies aren’t hiring because there isn’t enough consumer demand.
The conservative National Federation of Independent Business asks its small-business membership each month to name the single most important problem they’re facing. Last month, the most common response was “poor sales,” cited by 28 per cent. Government regulation came in second, at 18 per cent.Concerns over regulation have increased in the past two years — only 11 per cent cited it in April 2009, not long after Obama entered the White House. But the rise hasn’t been outside historical norms. More small businesses complained about regulation during the administrations of President Bill Clinton and the President George H.W. Bush, according to an analysis of the federation’s data by the liberal Economic Policy Institute.
High levels of economic uncertainty are another drag on business, but economists say that’s less due to regulation than to fights over government spending and taxes. Both consumer and business confidence fell in August, for example, as the White House and Congress wrangled over the nation’s borrowing limit. But that was a bipartisan dispute that can’t be solely pinned on Obama.