Well, says Pierre Lemieux, we've been living it as The Great Stagnation. He cites the work of Melinda Warren of the Weidenbaum Center at Washington University, and John Dawson of Applachian State and John Seater of North Carolina State (universities) that the cost to the American economy of government regulation has been so high as to be almost unbelievable.
I.e., that the 17-fold increase in the inflation adjusted budget of federal regulatory agencies, or the five-fold increase in the staffing of those same agencies since 1960, as well as the increase in the number of pages in the Code of Federal Regulations (CFR) from 19 thousand pages in 1949 to 134 thousand in 2013, has not been a free lunch. Quite the contrary.
Econometric estimates by Seater and Dawson are staggering; 2 percentage points of GDP growth annually. Which, due to compounding, means that we're short, today, some 40 trillion dollars of GDP. Meaning our $15 trillion economy ought to be in the neighborhood of $60 trillion.
The increase in government meddling in the economy has been especially noteworthy since the early 1970s, so next time you hear someone whining about stagnant wages since then....