Regulatory Reform

A Congressional Proposal for “A Better Way”

States should be the drivers, unauthorized spending must end

During a recent address in the United States Capitol’s Statuary Hall, Speaker of the House Paul Ryan and other congressional leaders outlined “A Better Way,” a series of policy proposals mostly aligned with a vision of free markets and limited government. Given the federal government’s recent affinity for gridlock and penchant for overstepping its constitutional authority, a better way is certainly needed. Whether it will be delivered is an open question, but there are elements contained within some of the newly-released proposals that should be encouraging for supporters of federalism.

“A Better Way” urges a cultural shift back to federalism, stating that the federal government should “regulate only when the states are not better suited.” The proposal reinforces the role of states as the proper source of regulation and even invokes Justice Louis Brandeis:

Everything doesn’t need to be done by Washington. Federal agencies should defer to state and local governments whenever possible. The federal government should only regulate where there is a problem of national scope that states cannot address. These levels of government are closer to the people and better able to adapt responses to state and local needs. In addition, the collective power of 50 state laboratories of democracy of different conditions and all of their localities offers tremendous potential to come up with the best regulatory practices and test different approaches.

The need to reform and shrink federal authority, of course, comes from not only a desire for federalism, but a need to reduce costs. The federal budget process needs reform. In 2017, mandatory spending on programs like Medicare and Social Security (plus interest on the national debt) is estimated to be just shy of a gargantuan $2.9 trillion. Those budget line items are on autopilot, with significant political capital required to move the reform needle. A much lighter lift, though, comes in the form of solving a relatively unknown, but hugely expensive problem.

Discretionary spending overall is far too high, and within that total is a troublingly large amount of spending that, in theory, does not actually have Congress’ proper permission. Put very simply, discretionary federal spending programs must first be authorized by Congress before revenue is committed. Both House Rules and Senate Rules impose this requirement. In the 2016 fiscal year, Congress appropriated $310 billion for programs that either had no authorization or had expired authorization. The process is designed to assist in limiting and tracking spending. If that basic process is simply ignored, however, there is little chance that discretionary federal spending, estimated to be $1.2 trillion in the 2017 fiscal year, will ever come under control.

“Facing a $19 trillion debt and trillions more in unfunded liabilities, congressional leaders have to seek spending cuts across the board – and taking aim at the billions annually in improperly authorized expenditures is an excellent place to start,” said Jonathan Bydlak, President and founder of the Institute to Reduce Spending, a non-partisan think tank focused on federal spending reform. “While taking on unauthorized spending and pushing budget reform more generally is not a cure-all to federal liabilities, it is an obvious solution that both parties should consider pursuing.”

At this year’s Spring Task Force Summit in Pittsburgh, Pennsylvania, the ALEC Tax and Fiscal Policy Task Force voted to adopt a Resolution in Support of Ending Unauthorized Federal Spending. The continued existence of unauthorized programs, often in the form of onerous regulatory agencies and programs is a threat to the states. Not only does the existence of unauthorized programs illegitimately drain taxpayer dollars, but many of their activities overstep their scope of authority, led by unelected bureaucrats whose decisions impact hardworking Americans without a single vote being cast. Efforts to eliminate such unauthorized and illegal spending are certainly a step in the right direction, both fiscally and for the preservation of federalism.

In describing what makes America great, Speaker Ryan recently referenced the late Justice Antonin Scalia, who noted that it is not our Constitution or Bill of Rights that guarantees the preservation of our civil liberties. Rather, it is the separation of powers among government. While Ryan and Scalia correctly believe that separation of powers between federal branches is appropriate, the logic follows beyond federal issues. Separating the Federal Government from the encroaching powers it has slowly usurped from the states will do as much to ensure our liberty as guaranteeing co-equal federal branches. If America truly wants a better way, it has 50 places to look.


In Depth: Regulatory Reform

In his first inaugural address, Thomas Jefferson said that “the sum of good government” was one “which shall restrain men from injuring one another” and “shall leave them otherwise free to regulate their own pursuits of industry.” Sadly, governments – both federal and state – have ignored this axiom and …

+ Regulatory Reform In Depth