Despite new costs still hovering in the billions of dollars, last week was a relatively muted one on the regulatory front. There were only a half-dozen rulemakings with some quantifiable economic impact, with most of those rules bringing limited effects. A proposed rule from the Federal Trade Commission (FTC) regarding the disclosure of fees for various goods and services provided the main regulatory fireworks for the week. Across all rulemakings, agencies published $8.8 billion in total costs and added 3 million annual paperwork burden hours.

REGULATORY TOPLINES

• Proposed Rules: 30
• Final Rules: 59
• 2023 Total Pages: 77,371
• 2023 Final Rule Costs: $118.1 billion
• 2023 Proposed Rule Costs: $520.7 billion

NOTABLE REGULATORY ACTIONS

The most significant rulemaking of the week was the FTC proposed rule titled “Trade Regulation Rule on Unfair or Deceptive Fees.” The proposal seeks to “prohibit unfair or deceptive practices relating to fees for goods or services, specifically, misrepresenting the total costs of goods and services by omitting mandatory fees from advertised prices and misrepresenting the nature and purpose of fees.” FTC includes more specified analysis of the rulemaking’s impact on the “Live-Event Ticketing,” “Short-Term Lodging,” and “Restaurant” industries given the more pronounced impact ancillary fees play in each of those categories, but the Commission also anticipates that the rule will apply “economy-wide.”

As such, while FTC assumes that only 10 percent of firms would currently be in non-compliance with these new standards, the quantified cost estimates add up quickly. FTC expects total costs over a 10-year period to range between $4.4–$12.1 billion (for an average of $8.2 billion). Much of FTC’s cost estimate, however, is built on very broad assumptions. As the Commission acknowledges:

It is difficult to quantify the net social benefits of the proposed rule at the economy level because it depends on the extent to which drip pricing exists and the degree to which the rule would result in more informed decisions for consumers, which vary by industry. Since the Commission is unable to quantify the benefits of the proposed rule at the economy level, we instead calculate the break-even benefit per consumer based on the quantified costs.

Under this break-even approach, FTC contends that the proposal will be economically justified if it results in 16 minutes-worth of time savings (or $6.65 in monetized terms) for the average consumer over that 10-year horizon.

TRACKING THE ADMINISTRATIONS

As we have already seen from executive orders and memos, the Biden Administration will surely provide plenty of contrasts with the Trump Administration on the regulatory front. And while there is a general expectation that the current administration will seek to broadly restore Obama-esque regulatory actions, there will also be areas where it charts its own course. Since the AAF RegRodeo data extend back to 2005, it is possible to provide weekly updates on how the top-level trends of President Biden’s regulatory record track with those of his two most recent predecessors. The following table provides the cumulative totals of final rules containing some quantified economic impact from each administration through this point in their respective terms.While the main action of the week came on the proposed rule side of things, there was some upward movement in the Biden Administration’s cost and paperwork totals, with increases of $438 million and 2.9 million hours, respectively. A Department of Health & Human Services (HHS) rule regarding Medicare payments for end-stage renal disease provided the bulk of these shifts. In terms of comparing trends across all three administrations, the Trump Administration saw the most pronounced cost increase of more than $2.4 billion while the Obama Administration far exceeded the other two in paperwork with a nearly 17 million-hour spike on that count. Another HHS payment rule was the primary reason for the former trend, and a Department of Transportation rule regarding “Conductor Certification” provided the majority of the latter.

TOTAL BURDENS

Since January 1, the federal government has published $638.8 billion in total net costs (with $118.1 billion in new costs from finalized rules) and 191.2 million hours of net annual paperwork burden increases (with 8 million hours in coming from final rules).