Our founders didn't anticipate that it would be much harder to repeal a law than pass it in the first place. Here's how we can revise the status quo and build a more efficient democracy.
The regulatory state exists because of the practical necessity for a traffic cop to oversee common resources and enforce minimum norms of safety and fairness. This is a dynamic role, requiring government to be an active umpire in a crowded world, adapting to new challenges while keeping its own house in order.
But America's massive, convoluted, rigid legal structure makes it almost impossible for government to do this job sensibly and within budget. Laws are piled upon laws, making adaptation essentially illegal. Congress doesn't clean out the stables in part because of a constitutional flaw -- our founders didn't anticipate that it would be much harder to repeal a law than passing it in the first place. Bureaucracies don't clean out regulations for the additional reason that the agencies become inbred, and are run by people who do things this way because that's how it's always been done.
The regulatory state has taken a life of its own, insulated from democratic accountability by thick walls of law. The status quo is defended by legions of lobbyists on K Street and by a million or so lifetime bureaucrats who can't imagine any other way of doing things. Want to do something different, like, say, balance the budget? Sorry, old laws and mandates stand in the way.
Breaking through these legal barriers requires new structures that compel legislators and regulators to clean out obsolete law and otherwise make sure government is doing what society needs today.
How do we force legislators and regulators to rethink old law? Sunset laws are one possible solution, requiring that programs automatically expire. In practice, however, sunset laws are easy to circumvent -- the legislature simply passes an omnibus re-authorization. Indeed, sunset laws provide an opportunity for politicians to "go back to the well," getting campaign support from the affected special interests in order to reinstate the provision (as Professor Rebecca Kysar found with tax breaks that periodically expire).
There needs to be a way either to force Congress to act, or to raise the profile of obsolete law so that there is political accountability if it fails to act. Here are possible proposals, in descending order of difficulty:
1.Constitutional amendment requiring sunsets: "No statute or regulation requiring expenditure of public or private resources (other than to oversee legal compliance or enforcement), shall be in force for longer than  years. Congress may re-enact such a law only after finding that it continues to serve the public interest and does not unnecessarily conflict or interfere with other priorities."
A constitutional amendment is action-forcing because it empowers a federal court to step in to end an obsolete program if Congress doesn't do its job. That is also its disadvantage, as interested parties seek to use the courts to eliminate laws they don't like. Another potential disadvantage is that the amendment is over-inclusive, and would require re-authorization of laws that are broadly accepted (say, establishing the Department of Defense). But perhaps even uncontroversial agencies and programs deserve congressional re-examination every few decades.
2. Sunset commissions. Congress could pass a law authorizing one or more legislative review commissions, made up of independent citizens, to recommend either overhauls of specific statutes or identify which statutes should sunset. Congress could also simplify the process by having the recommendation subject only to an up or down vote. (Such a limitation, similar to the base-closing commission model, has some constitutional uncertainty.) A variation would be Judge Guido Calabresi's proposal, where Congress would authorize courts to clean out obsolete law, subject to congressional review.
3. Spring cleaning agency. To an amazing degree, federal regulations promulgated by executive agencies are beyond the control of the president. Sunset commissions could review regulations as well as statutes. Dislodging the regulatory mortar could also be done by creating a new oversight superagency in control of the president, not staffed with tenured civil servants, with the sole job of rationalizing or eliminating duplicative and obsolete regulations. For those concerned about too much presidential power, the effective date of regulatory spring cleaning by the superagency could be delayed to give Congress a chance to override the changes.
The reason to give super-authority to an agency in control of the president is that, otherwise, the job never gets done. At least the president is politically accountable. As Sen. Mark Warner (D-VA) has observed, cleaning out old regulations is just not part of the bureaucratic culture. Even when the president embarks on an effort to eliminate stupid rules, as President Obama has done, it ends up being an exercise in pruning twigs in a vast jungle. No one even thinks about remaking the basic regulatory structure.
4. "One in, one out" requirement for regulations. Under a bill being drafted by Sen. Warner, agencies could not impose a new regulation unless they first eliminated old regulations of equal cost. The advantage of this proposal is that it introduces into the bureaucratic culture the necessity of budgeting regulation. Britain has a similar law, which has thus far proven effective at cutting costs and slowing the pace of new regulation. Another proposal, the so-called REINS Act introduced by Rep. Geoff Davis (R-KY), would require congressional approval for any regulation with a projected economic impact of $100 million or more. But this proposal does nothing to clean out old regulations. The probable effect, as both critics and supporters suggest, is regulatory paralysis: in the current partisan environment, there would be no major new rules.