Policy Report

This annual listing of ten of the worst regulations of the federal government, jointly produced with the Lexington Institute, focuses this year on environmental and technology regulations.

Would imposing price controls on drugs be good policy for the public, states and the nation?

The Internet has quickly become the defining element of the last decade of the 20th Cen-tury.
Whether the Internet continues to be the driving force behind the economy, educa-tion
and even culture in the next century depends to a large extent on what policies,
regulations and taxes —if any —Congress and the states impose on the new medium.

While deciding not to tax the Internet raises several problems, so does imposing a tax.
How will businesses ensure the privacy of purchasers? Would government keep a record
of those purchases? Would an Internet sales tax slow the growth in e-commerce, and
would e-tailers flee U.S. shores in order to avoid the tax?

Ronald Reagan characterized politicians’ natural predisposition as, “if it moves, tax it; if it keeps moving, regulate it; and if it stops moving, subsidize it.” The Reagan dictum still holds, it seems, even if “it” moves in data packets at the speed of light. Today politicians at virtually every level of government are looking for ways to tax the Internet.

IPI's annual joint project with the Lexington Institute. This year's report on 10 of the worst regulations of the federal government features environmental and other regulations where the combination of bad science and big government results in regulatory madness that needlessly infringes on the freedom of American citizens and corporations. These regulations also place enormous financial burdens on the U.S. economy.

The vast majority of job creation is occurring in small business. At the same time, government regulation at the federal, state and local level impacts small business to a much greater degree than larger businesses. It is easy to overlook the effects of regulation and taxation during a period of sustained economic growth. Yet, mounting evidence suggests that small firms are critical for continued economic prosperity. This study is a valuable summary of statistics regarding the significance of the entrepreneurial sector, and the evidence of the impact of taxation and regulation.

This study is a survey of historical estate taxation, an economic analysis of the impact of estate taxes on the economy, and contains a dynamic analysis of the impact of eliminating estate taxes.

1999's installment of IPI's annual review of ten of the worst regulations of the federal government. 2-page treatments of ten harmful regulations, with suggestions for reform. Regulations include Labor Dept. Pension Rules, Attempted Environmental Crimes, the Americans with Disabilities Act, Bilingual Education, EPA Sludge Rules, the federal sugar program, the FCC's Universal Service Program, Foreign Sales Corporations and military producers, CA's Proposition 65, and the "Tulloch Rule" interpretation of the Clean Water Act.

In 1997, Congress forfeited a golden opportunity to begin returning large budget surpluses to the taxpayers in the form of tax cuts. Part of the failing was political will, but faulty budget projections by the Congressional Budget Office (CBO) were a major part of the failure. In this policy report, economist Larry Hunter explains the forecasting errors of CBO and the political failures of the Republican-controlled Congress, and warns that the budget surplus is a "self-negating proposition," in that Congress will spend the money before it accumulates. The only way to prevent government from simply spending the money is to cut taxes first. Hunter repeats Jack Kemp's call for large, Reaganesque tax cuts before it is too late.

"We'd love to cut your taxes, but it's against the rules" say politicians. The rules they are talking about is a budgetary regime referred to as "Paygo," or "pay-as-you-go." Passed as a deficit control measure, the Paygo rules were intended to prevent Congress from cutting taxes unless they cut spending by an equivalent amount. It sounds prudent, but as practiced, Paygo is an albatross around the neck of those who want to reduce a historically-high tax burden in the face of enormous mounting budget surpluses.