How Regulations Accumulate as a Small Business Grows

The Senate votes this week on a small business tax-break bill which also contains controversial provisions to boost community-bank loans to small business. That is, Washington wants to “nudge” small banks into making loans that they’d otherwise avoid. Kind of like what the government did with home mortgage lending, with results some party poopers might characterize as catastrophic, but hey, who’s paying attention to things like that anyway.

One tries in vain to argue that the answer to recovery is not to artificially stimulate anything, or to overrule prices and rates in the marketplace; those are signals about underlying realities to heed and allow to play out. But beyond that, we must cut regulations that paralyze business and job creation. The starting point is to inventory all the regulations that impact a small business as it grows, and set about rolling them back.

Below is the rough inventory I’ve compiled, but I’m sure it’s out of date and some things have changed. And this doesn’t even address industry-specific rules (see endnote), themselves desperately in need of reform. And it certainly doesn’t address yet-to-come from the new financial reform and Obamacare legislation. I welcome any additions and subtractions.

FEDERAL WORKPLACE REGULATION IMPOSED ON GROWING BUSINESSES* (Draft—Wayne Crews)

ONE EMPLOYEE

• Fair Labor Standards Act (overtime and minimum wage [27% min. wage increase since 1990])
• Social Security matching and deposits
• Medicare, FICA
• Military Selective Service Act (90 days leave for reservists; rehire discharged veterans)
• Equal Pay Act (no sex discrimination in wages)
• Immigration Reform Act (eligibility must be documented)
• Federal Unemployment Tax Act (unemployment compensation)
• Employee Retirement Income Security Act (standards for pension and benefit plans)
• Occupational Safety and Health Act
• Polygraph Protection Act

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