Fat Bear Week: What States Can Learn

As autumn begins, we draw closer to annual traditions of feasting, ignoring calorie counts, and questionable table manners. That’s right. It’s Fat Bear Week.

Alaska’s Katmai National Park bears compete this week to show who has packed on the most pounds. It is a fun competition for us spectators— Team Bear 909 Jr. here—and serious business for the bears needing to make it through winter on stored calories.

But these bears aren’t the only ones adding extra layers. State governments are gaining weight in the form of regulatory burdens – and it’s time for a diet.

According to the Mercatus Center, state regulatory loads continue to grow, not just in word counts, but also in legally binding restrictions on residents. States like California, New York, and Illinois carry the heaviest regulatory burdens, with tens of thousands of rules imposing costs on businesses and individuals alike. California leads the nation with over 420,434 restrictions, while states like Idaho, with only 31,497 restrictions, are on the lighter side.

While governments may need new, commonsense regulations to account for a rapidly changing world, states often keep old and irrelevant regulations on the books. This accumulation has created state codes that take months just to read, let alone understand.

Such regulatory bloat has very real consequences. According to a 2005 World Bank study, a “10-percentage-point increase in a country’s regulatory burdens slows the annual growth rate of GDP per capita by half a percentage point,” costing nations
“billions… in lost GDP growth.” Another Mercatus report found that a “10.0 percent increase in federal regulations (that apply to a given state) is associated with a 2.5 percent increase in the poverty rate.”

States can take a lesson from the Katmai bears. While the bears may bulk up as the seasons change, they also trim down to emerge as effective and efficient powerhouses ready to take on new challenges.

Luckily, some states have already made progress by implementing reforms like ALEC’s Act to Establish a Cap on Government Red Tape. Idaho’s 2019 regulatory reform led to a 95% reduction in red tape for the state and solidified its status as the state with the least regulatory restrictions. Ohio’s 2022 law gives state agencies three years to reduce their regulatory restrictions by 30% and establishes a regulatory cap. Similarly, Virginia Governor Youngkin set a regulatory reduction goal of 25% in 2022. He also established the Office of Regulatory Management via executive order to ensure agency compliance.

It turns out regulatory cutting, much like hibernation, leaves states more agile and competitive. States that deregulated by at least 5% since 2020, “experienced average annual growth of 2.09%,” according to Mercatus research. Whereas states without significant deregulation efforts added regulations and experienced a lower growth rate of 1.87%, on average. For the states cutting unnecessary regulatory red tape, the economic advantage will be significant.

While we wish all Katmai ursids much success and salmon this week, we do not extend our bulking wishes to state governments across the nation. Instead, we hope to see the states unleash economic opportunity as they pursue regulatory weight loss.