Ten Fatal Flaws in the "Regulatory Uncertainty" Argument

by Daniel Farber | September 12, 2011

Cross-posted from Legal Planet.

A current conservative refrain is the regulatory uncertainty is holding back the economy.  Consider an editorial entitled “Obama’s regulatory flood is drowning economic growth”:

Businesses large and small face more uncertainty today about the federal regulatory environment than at any point since the New Deal . . . . Seeing this tsunami of red tape flooding out of Washington, company owners and executives wisely opt to delay new hires and investments until they have a clearer idea how much their already huge compliance costs will increase and how the markets will be warped by changes mandated by the bureaucrats.

Of course, it sounds better to talk about “regulatory uncertainty” than just to say that businesses hate the idea that they’ll have to cut pollution or give more information to consumers.  In any event, there’s so much wrong with the “uncertainty” argument that it’s hard to know where to begin.  Here are ten fatal flaws:

  1. Wrong pattern of unemployment. As Think Progress points out, unemployment is currently lowest in health care, extractive industries, and the financial sector — exactly the areas where there has been the most regulatory effort.
  2. Reverse effect of uncertainty. If businesses were worried that future regulatory burdens were coming down the pike, they’d want to increase investments today in order to benefit from the current more lenient regulations — a point ably made by ...

More Anti-EPA Shenanigans? Is IRIS Next on the Hit List? We'll Be Watching

by Rena Steinzor | September 08, 2011
From what we hear, EPA is not a happy place these days, and we don’t wonder why. Never did a hard-pressed staff deserve so much guff, less. Politico reported that the White House is treating Lisa Jackson with kid gloves, hoping against hope that she won’t up and quit on them over the outrageous White House trashing of the efforts to update an outmoded, unhealthy, and legally indefensible 1997 ozone standard. Good thinking for a change. With the Natural Resources Defense Council (NRDC) sending ...

White House Review of "Chemicals of Concern" List A Full Year Past Due

by Lena Pons | September 08, 2011
In May 2010, EPA sent a draft “Chemicals of Concern” list, including bisphenol A (BPA) and five other chemicals, to the White House’s Office of Information and Regulatory Affairs (OIRA) for review. The proposed list would be the first time EPA has used its authority under the Toxic Substances Control Act (TSCA) to publish such a list of chemicals that “may present an unreasonable risk of injury to health or the environment.” Today marks one year since OIRA exceeded the 120-day deadline ...

Lisa Jackson Should Promulgate the Ozone Standard or Resign

by Thomas McGarity | September 06, 2011
Last Friday, President Obama ordered EPA Administrator Lisa Jackson to withdraw EPA’s new ambient air quality standard for ground level ozone (smog). The order came in a letter from Cass Sunstein, the head of the Office of Information and Regulatory Affairs in the Office of Management and Budget.  The order does not pretend to be based on science. Indeed, it flies in the face of the available science on the human health effects of ozone as determined on at least two occasions ...

Choking on Smog for Another Few Years

by Rena Steinzor | September 02, 2011
In perhaps the most troubling sign of his determination to pander to business at the expense of public health, President Obama announced this morning that he had blocked EPA’s science-based efforts to lower the levels of smog that drive children and the elderly inside on Code Red days. Automobile manufacturers, power plant operators, the oil industry, and the Chamber of Commerce are breaking out the champagne, while the public health community despairs of the President who promised so much and has ...

Obama Administration Withdrawing EPA Ozone Standard an Illegal and Immoral Move

by Victor Flatt | September 02, 2011
Today’s decision of the Obama administration to withdraw new ozone rules is not only bad policy, it is also illegal. The Clean Air Act requires the EPA to revisit its National Ambient Air Quality Standards (NAAQS) every five years to ensure that they are adequate to protect the public health and safety. In 2006, the Bush Administration revisited the rules as required, but proposed a new standard of .75 P.P.M., which was far above the unanimous recommendations of the scientists who said ...

Is Cap and Trade Unfair?

by Daniel Farber | September 01, 2011
Cross-posted from Legal Planet. I should probably start by putting my cards on the table. I’m not really an advocate of cap and  trade as compared with other forms of regulation.  What I care about is getting effective carbon restrictions in place, whether they take the form of cap and trade, a carbon tax, industry-wide regulations, or something else. The big advantage of cap and trade from that perspective is that some systems are already up and running, and unlike ...

The Agenda Behind the Republicans' Latest 'Jobs' Agenda: New CPR Report Reveals Effort to Gut Regulations Is Based on False Premises

by Sidney Shapiro | August 31, 2011
House Republicans have promised this week that upon their return to Washington after the recess they will attempt to stop 10 important proposed regulations because they are “job-destroying.” Adhering to the belief that “if you say it often enough, people will believe its true,” the party continues to insist that regulations cost jobs. But, as I discussed in a recent post, the evidence shows that regulation is not a drag on employment because it stimulates the creation of as many new ...

Platinum Industry Association Responds to My Critique of Their DQA Complaint

by Matt Shudtz | August 25, 2011
Shortly after my August 5th post criticizing their Data Quality Act complaint to EPA, the International Platinum Group Metals Association sent me a kindly-written response letter (Inside EPA recently reported on the letter). Accusing me of both missing the point of their complaint and brushing aside important scientific concerns to make a headline-grabbing call for “over-regulation,” IPA reiterated their concern that EPA’s draft IRIS assessment for halogenated platinum salts fails to meet DQA standards. Their letter is an eloquently-written piece of advocacy, ...

Regulatory Look-Back Plans: No One Celebrates

by Rena Steinzor | August 23, 2011
The final agency regulatory “look-back” plans, released by the White House this morning, don’t appear to satisfy anyone. They fall far short of their obvious goal: to placate greedy and intemperate industry demands that major rules be cancelled. And they distress public interest advocates, who fear they will preoccupy agencies with make-work at the expense of crucial life-saving initiatives. The plans themselves, at first look, are largely well-intentioned given the assignment the agencies were given. The EPA plan discusses, for instance, how ...

Never Let the Facts Get in the Way of a Good Story: New BLS Data is Latest to Disprove Conservative Claims of "Job-Killing Regulations"

by Sidney Shapiro | August 22, 2011
The current anti-regulatory mantra of Republican legislators (e.g., Cantor, Boehner, Issa) and conservative think tanks (e.g., CEI and Heritage) is that regulation is a “job-killer.” And a top plank of Republicans’ job agenda when they return from the summer recess is to limit regulations. There is just one problem with this rhetoric. It is not backed up by the data, including the latest Department of Labor study on the reasons why employers lay off workers. Economic studies indicate that regulation is not a ...

On Heels of Debunked Report, SBA's Office of Advocacy Solicits More Anti-Regulatory Research

by James Goodwin | August 16, 2011
What would you do if a report you funded was debunked by a scathing critique from the nonpartisan Congressional Research Service?  What if you found that the researchers you funded had based 70 percent of their analysis of the costs of regulation on a regression based on opinion polling data?  What if the researchers who had published that opinion polling insisted publicly that their data was never meant to be used for such purposes?  What if a member of Congress ...

Thought We Wouldn't Notice: Blanche Lincoln Quietly Switches to New Version of Debunked SBA Regulatory Costs Stat

by Ben Somberg | August 12, 2011
Former Senator Blanche Lincoln, now heading the National Federation of Independent Business’s new anti-regulatory campaign, faced criticism in recent days for citing the debunked SBA study claiming regulations cost $1.75 trillion in a year. The NFIB used that stat last week in launching its campaign (see ThinkProgress), and Lincoln cited the number in a National Journal forum post on Monday: While some federal regulations are important, it costs the U.S. economy a staggering $1.75 trillion a year to comply with ...

Legs of Two 17-Year-Olds Severed in Grain Auger, White House Sits on Young Worker Safety Rule

by Celeste Monforton | August 12, 2011
Cross-posted from The Pump Handle. Tyler Zander, 17 and Bryce Gannon, 17 were working together on Thursday, August 4 at the Zaloudek Grain Co. in Kremlin, Oklahoma. They were operating a large floor grain aguer when something went terribly wrong. Oklahoma's News9.com reports that Bryce Gannon's legs became trapped in the auger, Tyler Zander went to his friend's aid and his legs also were pulled into the heavy machinery. Emergency rescue personnel had to cut apart the 12-inch metal auger ...

With Updates to EPCRA Reporting Rules, EPA Has Another Opportunity to Better Protect Workers

by Matt Shudtz | August 11, 2011
On Monday, EPA announced its intention to revise the emergency planning rules for industrial facilities. The goal of the revisions is to give state and local emergency planning committees better information that they can use to prepare for chemical spills, explosions, and other disasters at industrial facilities. In the initial proposal released Monday, EPA disregards a request from first responders that the new rules demand more information about the total number of people likely to be on-site during an emergency situation. EPA is ...

Chairman Issa's NLRB Subpoena: An Unprecedented Effort to Thwart the Legal Process

by Sidney Shapiro | August 10, 2011
The National Labor Relations Board (NLRB) has a Friday deadline to respond to a subpoena issued by House Oversight Committee Chairman Rep. Darrell Issa (R., Calif.). The subpoena seeks "[a]ll documents and communications relating to the [NLRB's] Office of General Counsel's investigation of Boeing..." prior to the time the NLRB issued its complaint against the company. The NLRB has alleged the company created a second assembly line at a nonunion plant in South Carolina to build its 787 Dreamliner in order to ...

Nevada Court's Public Trust Decision A Welcome Addition to Growing Body of Protection for State Lands and Resources

by Alexandra Klass | August 08, 2011
Last month, the Nevada Supreme Court held in Lawrence v. Clark County that the public trust doctrine limited the ability of the state to freely alienate certain lands that, though dry at the time of the decision, were submerged under navigable waters at the time of statehood. The case is significant for at least two reasons. First, the court made clear that the public trust doctrine in Nevada places inherent limitations on state power and cannot be easily abrogated by state legislation, ...

Platinum Industry Tries a DQA Complaint the Bush Administration Wouldn't Even Accept

by Matt Shudtz | August 05, 2011
On Monday, the International Platinum Group Metals Association submitted a Data Quality Act complaint (pdf) to EPA regarding a draft toxicological review of halogenated platinum salts and platinum compounds. This one ought to go straight to the agency’s recycling bin. IPA, as the trade group calls itself, is complaining that the draft document, released by EPA’s IRIS office in 2009 for peer review and public comment, does not meet the standards of objectivity and utility required under the DQA and its ...

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