BUSINESS INSIGHTS

Abstract

The Business Roundtable has decided that if industry can reengineer itself, the government can do the same to the regulatory process. Late last month, the Washington, D.C. based lobbying group issued a white paper calling for a more rational approach to government regulation of industry. The white paper, titled Toward Smarter Regulation'', was sparked by the increasing cost to companies of regulation and by what the round-table sees as conflicts and inefficiencies in the regulatory process. The increase in direct costs is certainly a real problem. Pollution control costs are a good example. The Commerce Department data show that between 1972, perhaps the seminal year of environmental regulation, and 1992, spending on pollution abatement and control in constant dollars in the US increased at an average annual rate of 3.3%. Meanwhile, gross domestic product rose at only a 2.3% annual rate. However, the white paper goes further in saying that the annual cost of total federal regulation in 1993 has been estimated at $581 billion and is projected to rise to $662 billion by 2000.