Mercatus Center of George Mason University "The 2015 Economic Freedom of the World report was recently released and out of the 157 countries ranked the United States fell from the 12th slot in 2014 to 16th. This includes an especially low rank of 49th in the category “Business regulations,” which is probably not surprising to any U.S. business owner.
"According to the Mercatus Center’s RegData database, federal restrictions on business activities increased 28 percent from 1997 to 2012. While these regulations may be well intentioned, excessive rules and restrictions can have pernicious effects on the economy.
"A new study that uses RegData shows that federal regulations decrease new hiring. In addition to this direct, negative effect on economic activity, there is an unseen effect — the businesses that are never started because potential entrepreneurs are discouraged by all the red tape in their path.
"Along with the decline in new hiring, the aforementioned study shows that more regulated industries experience fewer new entrants into the market each year. This unseen effect negatively affects economic growth in the long run and the short run.
"An agency rule, restriction or regulation may not seem like a big deal on its own, but the cumulative effect can be death by a thousand cuts. For instance, the combination of new $5-per-hour parking meters and a local rule requiring establishments to verify that at least 80 percent of their business comes from the local area contributed to the recent closure of a 100-year-old fruit store in Palm Beach, Fla." . . .
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