The federal government is hiding the actual costs of the paperwork burden it puts on people and U.S. companies, making it appear less oppressive than it really is, according to a new analysis of Uncle Sam’s red tape.
Instead of costing the public about $139 billion a year to comply with over 9,000 rules and requirements, such as filling out income tax returns, the price tag could be $423 billion or higher, according to the analysis from American Action Forum, which studies regulations.
“If it seems that Americans face a monumental level of government paperwork, it’s because we do,” said Dan Goldbeck, the senior regulatory policy analyst at AAF. The group shared his report with Secrets in advance of its release.
“The federal government puts the government-wide cumulative paperwork burden at nearly 10 billion hours each year (that equates to more than 1.1 million years-worth of hours). That’s a lot, but at least appears to be an accurate accounting. The listed total for annual costs from these paperwork requirements is roughly $139 billion (for reference, that’s more than the net worth of Bill Gates). That’s also a lot, but this figure provides a woefully incomplete picture of the actual paperwork costs,” he added.
Goldbeck didn’t uncover why the government undercounts the cost of filling out paperwork. But he hopes his report and other calls for transparency force the government to more accurately account for the price of red tape.
To come up with his estimate, he looked at the top paperwork burdens and added in the hourly costs that the federal government left out of its recent accounting. For example, the government said that people spend about $82 billion in time filling out individual and corporate tax returns.
“An examination of the supporting documentation for the most burdensome requirements reveals that, when including these hourly costs, the total annual cost of the federal paperwork burden is at least $276.6 billion — about twice as high as the public-facing figure — and perhaps upward of $423 billion,” Goldbeck found.
That’s a big difference and one the public deserves to see closed, he argued. What’s more, he hinted that drawing attention to the actual costs might force the administration to cut paperwork requirements.
“While it fluctuates on a daily level due to the churn of the paperwork review process, the current government-wide tallies of the federal paperwork burden are roughly: 9,400 distinct paperwork requirements, 10 billion hours of time spent each year, and $139 billion in associated costs. That last number does not tell the full story, however. Diving deeper into estimates provided by supporting documentation, one finds that figure ballooning up to perhaps three times that level. Ascertaining a more transparent and complete accounting on this matter is both good policy in its own regard and key to finding ways to cut out the unnecessary and duplicative paperwork items involved,” Goldbeck wrote.
