James Goodwin on CPRBlog {Bio}
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Senate Joint Committee Hearing Dedicated to Attacking Public Servants

When your public approval rating has hovered at or below 20 percent for the last several years, maybe the last thing you should be doing is maligning other government institutions.   That didn’t stop a group of Senators from spending several hours doing just that today during a joint hearing involving the Senate Budget and Homeland Security and Government Affairs Committees.  The joint hearing was nominally about a nonsense regulatory reform proposal called “regulatory budgeting” (for more on that, see here), but it quickly devolved into a no-holds-barred hate session directed at federal agency employees, as the upright and honorable members of the “world’s greatest deliberative body” repeatedly attacked the prevailing “culture” at agencies.

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You Can Be for Cost-Benefit Analysis or You Can Be for Regulatory Budgeting, But You Can’t be for Both

For decades, so-called regulatory “reformers” have backed up their sales pitches with the same basic promise:  Their goal is not to stop regulation per se but to promote smarter ones.  This promise, of course, was always a hollow one.  But it gave their myriad reform proposals—always involving some set of convoluted procedural or analytical requirements designed to surreptitiously sabotage the rulemaking process—some shred of legitimacy, while insulating the proponents against any public backlash that might follow from such cynical attacks on broadly popular public health, safety, and environmental programs.

If the real motivation behind the “regulatory reform” movement wasn’t clear before, then tomorrow’s hearing before the Senate Homeland Security and Government Affairs and Budget Committees on “regulatory budgets” ought to peel away the last of any lingering doubts.  The idea behind “regulatory budgeting” (or “regulatory pay-go,” as it is sometimes known) is that Congress would set a hard cap on total regulatory costs, and once the cap has been met, agencies would be prohibited from issuing any rules until their costs have been offset by the removal of existing regulations.  Its proponents claim that this cap on regulatory costs somehow reflects all the safeguards our country “needs” or “can afford.”  Ask them to substantiate that claim, though, and all you’ll get is a lot of arm waving and vague platitudes.

 

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Obama Administration Crosses Off a Big Item on Its Safeguard To-Do List, But Much Remains to be Done

Unless you’re living under a rock or are a FIFA executive official being indicted for criminal conspiracy, you’ve no doubt heard by now that the Environmental Protection Agency (EPA) has at long last released its final rule establishing a clear regulatory definition that, consistent with both the previous court decisions and the best available science, delineates which water systems are covered by the Clean Water Act.  The rule was included in a recent CPR Issue Alert, highlighting 13 essential regulatory actions that the Obama Administration should commit to completing during its remaining time in office.

The rule would seem to provide everything that conservative opponents of regulation would want: regulatory certainty and efficient use of agency funds (i.e., by preventing the EPA from having to undertake wasteful case-by-case analyses of which water bodies warrant federal protection).  Yet, it has been a lightning rod of controversy, attracting specious claims that the rulemaking represent a nefarious attempt by power-drunk, faceless bureaucrats in Washington, DC, to assert federal control over all land use in the United States.

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More Right-Wing Pseudo-Research on the Costs of Regulation

The Competitive Enterprise Institute is out with the latest in a series of industry-friendly reports overcooking the supposed costs of regulation, while understating or simply ignoring the vast benefits to health, safety and the environment. Not surprisingly, The Wall Street Journal and The Washington Times were good enough to put the right-wing echo chamber in motion in its service.

A few quick thoughts: This report isn’t scholarship, it’s arithmetic advocacy—and it’s poor arithmetic at that.  The organization that sponsored the report is more concerned with advancing its political agenda of laissez faire government at all costs than it is with sound public policy. This report is meant to advance that agenda, rather than inform the ongoing debate over the U.S. regulatory system. After all, what good does it do to tally up the costs of regulation without providing an estimate of regulatory benefits with which to compare them? Policymakers and the media would do well to ignore this report.

The report’s findings appear to be based on several inflated regulatory cost estimates, lined up and added together to produce exactly what the author likely intended: a huge number. Some of the numbers come from estimates produced by regulatory agencies themselves, which several retrospective studies have shown to be systematically inflated. Others come from individual reports assembled by the author. To the extent that the CEI report is based on several different sources that relied on a variety of different methodologies, there is a large possibility that simply adding them up will result in a lot of double counting, further inflating the CEI report’s conclusion. The author of the CEI report, however, appears to make no effort to address this problem either.

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CPR Member Scholars Call on Congress to Reject 'Unnecessary' and 'Unwise' REINS Act

This morning, the House Judiciary Committee is holding a markup on the Regulations from the Executive in Need of Scrutiny Act of 2015, or REINS Act (H.R. 427).  Even among the many extreme antiregulatory bills that Congress has considered this session, the REINS Act still stands out for its breathtaking audacity.  If enacted, this bill would block the most important environmental, safety, and public health regulations from taking effect unless Congress affirmatively approves them within the extraordinarily short period of 70 session days or legislative days.  It is not a stretch to say that many regulations that are now benefitting millions of Americans—such as those limiting lead in gasoline or requiring air bags in automobiles—would never have seen the light of day had the REINS Act been in place.  Versions of this bill have been introduced in both chambers of Congress over the last several sessions, but fortunately none have been enacted into law.

In response to this bill, 83 of the nation’s leading experts on administrative law and regulatory policy have signed on to a letter to the members of Congress expressing their concerns with the REINS Act.  Among the concerns described in the letter are that “the REINS Act would replace the strengths of agency rulemaking with the weaknesses of the legislative process” and that the bill is “counter-democratic.”  Twenty-six CPR Member Scholars were among the experts to sign on to the letter.

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Defeating the Public Interest One Bill at a Time: The ALERT Act (H.R. 1759)

 

Background:  Tomorrow, the full House Judiciary Committee will be holding a markup of the H.R. 1759, the All Economic Regulations are Transparent Act of 2015 (ALERT Act), sponsored by Rep. John Ratcliffe (R-Tex.).  The House of Representatives considered a similar bill during its last session.  (The hearing is also noteworthy, because the committee will be marking up H.R. 427, the Regulations from the Executive in Need of Scrutiny Act of 2015, or REINS Act.  For more information on the REINS Act, see here.)

What the ALERT Act does:  The bill would impose a series of new burdensome reporting requirements on agencies and the White House Office of Information and Regulatory Affairs (OIRA) regarding the progress and impacts of the agencies’ pending rulemakings.  Once a month, agencies would have to provide detailed information about any rules that they are working on, while OIRA would have to issue an annual report detailing the cumulative costs of all rules that have been proposed or finalized during the previous 12 months.  Agencies also would be blocked from implementing their final rules for at least six months until after they have published certain information about the rules on the internet.

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Carry the Zero: The Polluters’ Flawed Arithmetic in the EPA's Hazardous Air Pollution Rule

In the run-up to this morning’s oral arguments before the Supreme Court on the Environmental Protection Agency’s rule to limit hazardous air pollutants from fossil-fueled power plants—and indeed throughout the oral arguments themselves—opponents repeatedly pointed out that the benefits of the rule in reducing mercury pollution were “only” between $4 million and $6 million.  Putting aside the ethically problematic question of trying to put a dollars-and-cents value on achieving improved public health and environmental protection, it is worth pondering this number and what it reveals about the significant methodological flaws that are endemic to cost-benefit analysis.  (For the record, this number is supposed to represent the “value” of lost earning potential of children that the rule would protect against IQ point degradations.  Do you see what I mean about ethically problematic?)

Opponents of the rule claim that this $4-million figure is the only valid benefit estimation of the rule that the EPA should able to count in evaluating its mercury rule.  In making this argument, their real beef is that the EPA has also counted the co-benefits of the rule—that is, benefits that the rule achieves as an incidental byproduct of what is really trying to achieve.  In this case, EPA’s rule is meant to address mercury and other “hazardous” air pollutants, but along the way would significantly reduce particulate matter and ozone, which are classified as- “non-hazardous” air pollutants, but are still known by scientists to cause a host of environmental and public health problems.

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Today at the U.S. Supreme Court: Industry Tries to Shove a Cost-Shaped Peg Into a Benefit-Shaped Hole

When it comes to public safeguards, industry never wants to talk about keeping people healthy and protecting the environment; they’d much rather have a conversation about how safeguards will cut into their profits — the costs in the cost-benefit equation.  Even on matters where Congress, by statute, has made the discussion of regulatory costs legally irrelevant or a matter of only secondary importance, you can rest assured that industry will still be there talking exclusively about costs.  That is largely what is at issue in Michigan v. Environmental Protection Agencywhich is being argued today before the U.S. Supreme Court—another attempt by polluting industries to inject discussions of costs where they don’t belong.

But, for the EPA’s rule to limit mercury and other toxic pollutants from fossil-fueled power plants, the subject of the case, perhaps the most critical issue is the regulatory benefits at stake, and how the fulfillment of those benefits has been on a circuitous journey that is now extending into its 25th year. You read that right. It has been a quarter of a century since Congress first directed the EPA to issue this rule.  That’s when it passed the 1990 Clean Air Act Amendments.  As explained in a 2009 CPR white paper, the rule should have been completed by no later than 2000.  This ongoing delay has come at a huge price for the public health.  With every year that this rule has not been in effect, as many as 94,000 babies have been born in the United States with elevated blood mercury levels—levels high enough to leave them with irreversible brain damage—and as many as 231 children have suffered significant enough impairment of brain function to result in permanent mental retardation.

The fossil fuel industry no doubt wants to distract the public from contemplating the harmful health effects of its polluting activities; hence, it is trying to steer the conversation to regulatory costs in today’s case.  (The fact that these regulatory cost estimates are systematically overstated only provides them with further impetus on this score.)  It might be a useful PR move from their perspective, but it is not a legal requirement under the relevant provision of the 1990 Clean Air Act Amendments.  Let’s hope the Supreme Court will recognize this difference and reject industry’s abhorrent attempt to further delay this already long overdue safeguard for protecting our children’s health.

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Three Quick Reactions to Yesterday's House Oversight Committee Hearing on OIRA

Yesterday, the House Oversight Committee held a hearing on “Challenges Facing OIRA in Ensuring Transparency and Effective Rulemaking” that featured as its only witness the head of the White House’s Office of Information and Regulatory Affairs (OIRA), Administrator Howard Shelanski.   Given that regulations are a huge source of consternation on the Hill, and the prominent role that OIRA plays in the federal regulatory apparatus, oversight hearings involving OIRA always have the potential for fireworks.  Despite this potential, these hearings—which take place once a year or so—tend to be pretty staid affairs with some mild grousing over a few key issues that are undoubtedly worthy of congressional attention—including the delays caused by OIRA’s unacceptably long rule reviews and OIRA’s semiannual tradition of issuing regulatory agendas behind schedule and/or at inconvenient times of the year (i.e., before major holidays).   Yesterday’s had all of this, but it had a few big surprises, too.

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More Fun Than Escaped Llamas: House GOP to Hold Yet Another Antiregulatory Hearing

In keeping with an apparent effort to hold an antiregulatory hearing on any and all days ending in “y,” Congressional Republicans have teed up yet another humdinger for Monday, March 2. That’s when the House Judiciary Committee’s Subcommittee on Regulatory Reform, Commercial and Administrative law will take a closer look at three more antiregulatory bills that have been recycled from previous congresses, including the Responsibly and Professionally Invigorating Development Act of 2015 (RAPID Act), the Sunshine for Regulatory Decrees and Settlements Act of 2015 (SRDSA), and the Searching for and Cutting Regulations that are Unnecessarily Burdensome Act of 2015 (SCRUB Act).  And by “take a closer look,” I mean “recite tired free market platitudes en route to their predetermined conclusion that the passage of these three bills is the only way to prevent regulation-induced economic disaster.”

Others and I have written about all three of the bills in the past, so there’s no need to rehash all of the gory details here.  But, in approaching the hearing, a few thoughts are worth keeping in mind on each of these absurd bills:

The SRDSA.  Last week, I blogged about the SRDSA—a bill that its supporters claim is necessary to prevent so-called “sue and settle” agreements that lead to environmental regulations—to highlight how a recent Government Accountability Office (GAO) report had thoroughly demolished the “sue and settle” myth.  In fact, every claim made by the lead House and Senate sponsors of the SRDSA in their joint press release announcing the bill was directly refuted by the GAO.  Hopefully, this GAO report will be discussed at great length on Monday.   There is, however, a real “sue and settle” problem that is quite distinct from the fallacious one that congressional Republicans are constantly complaining about.  This one involves industrial polluters urging conservative state governments to sue them for their environmental violations, as a means of forestalling citizen suits that seek to hold companies liable for the same environmental violations.  The state dutifully steps in, blocks the citizen suit, and then settles with the company with a slap on the wrist.  The most infamous example of this maneuver took place just before the Duke coal ash spill in North Carolina last year. Any guesses on whether the Republicans will bring that up on Monday?

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