Obama's New Economic Plan: A Wing And A Prayer To Cut Paperwork

President Barack Obama used the opinion page of The Wall Street Journal to address many of the economic needs of the United States and to provide some of his solutions. Obama has tried to build a bridge to the American business and financial communities, so perhaps the Journal was an appropriate venue.

His suggestions mostly make sense, but many have been tried before without success. The timing of his op-ed is also odd. The American economy, particularly housing and employment, has been in trouble for some time, at least for three years. Surely, his solutions did not occur to him in just the last few weeks.

Obama said he would immediately sign an executive order.

This order requires that federal agencies ensure that regulations protect our safety, health and environment while promoting economic growth. And it orders a government-wide review of the rules already on the books to remove outdated regulations that stifle job creation and make our economy less competitive. It’s a review that will help bring order to regulations that have become a patchwork of overlapping rules, the result of tinkering by administrations and legislators of both parties and the influence of special interests in Washington over decades.

There have been efforts for years to exorcise unwieldy regulations and special interests. Most have not been successful, so the curtailment of them is not a very good start.

The President goes on to write:

We’re also getting rid of absurd and unnecessary paperwork requirements that waste time and money. We’re looking at the system as a whole to make sure we avoid excessive, inconsistent and redundant regulation

Paperwork is not the enemy of economic expansion, or job creation, or a housing recovery. It is much more likely that legislation which offers tax incentives for homebuyers, which has worked in the past, and credits for businesses to hire people are a more effective means to restart the economy. It is also certain that federal taxes on fuel and gas will be a burden to consumers and businesses if oil moves above $100 a barrel. Some of those taxes could be lowered, at least temporarily.

Washington often looks for reform through an attempted streamlining of the federal government. Such actions certainly have benefits to lower government costs and remove the duplication of efforts between departments and agencies. These changes are by their nature slow because of the number of agencies, the  numbers of regulations, and the constant changing of the guard in most parts of the senior management of the federal system.

Wringing waste out of government does not cost much. Obama does not need to approach the Congress to ask for funds. He does have to challenge Congress to attack the jobs and housing problems. They cannot be alleviated without some increase in the deficit. Tax credits and other incentives will cost tens of billions of dollars. But, shuffling papers is a waste of time, even if it does not cost much.

Douglas A. McIntyre