Join us.

We’re working to create a just society and preserve a healthy environment for future generations. Donate today to help.

Donate

Judicial Review and Cost-Benefit Analysis: Part II

Last week I discussed how the institution of judicial review has been used to amplify the deregulatory nature of cost-benefit analysis.  This week, I'll talk about some possible remedies.

An unusual synergy exists between the institutions of cost-benefit analysis and judicial review.  Under most circumstances, the institution of judicial review is arguably neutral with regard to regulatory issues.  When judicial review is applied to a case involving a regulation that has been weakened by cost-benefit analysis, however, the once neutral institution is transformed into one that that can have no other impact than to aid and abet the deregulatory agenda of cost-benefit analysis.  This is because when an agency is forced by cost-benefit analysis to promulgate a rule that is too weak to be supported by the underlying statute, any public interest groups concerned with public health, safety, and the environment is left with a difficult decision to make.  If they challenge the rule in court and win, theirs will be a Pyrrhic victory, because everything would return to the pre-regulatory status quo where no protections are in place, while the agency returns to promulgating a new rule.  If, however, they decide not to challenge the rule, then they will at least have some protections in place that are, for all intents and purposes, better than nothing.  In other words, the successful use of cost-benefit analysis to water-down health, safety, and environmental regulations places public interest organizations in a damned-if-you-do, damned-if-you-don’t situation when it comes to judicial review.

In their recent book, Retaking Rationality, Richard Revesz and Michael Livermore look at this as a “judicial remedies” problem—that is, they see the problem as one in which courts deciding these cases don’t have any good options for giving effect to their decisions when they find in favor of a party challenging a weakened regulation.  To deal with the problem of judicial review in this context, Revesz and Livermore propose that federal courts reviewing regulations employ a new remedy called “remand without vacatur.”  They write:  “In these cases, the court finds for the pro-regulatory plaintiff, but allows the illegally lenient agency regulation to stand, pending reconsideration of the rule by the agency.  Thus, the plaintiff has the advantage of the weak (but still better than nothing) regulation in place while the agency considers whether to propose a stricter rule or find additional justification for the weak rule.”

It is noteworthy that Revesz and Livermore do not use the problem of judicial review and cost-benefit analysis as providing further ammunition for the argument to jettison cost-benefit analysis.  Instead, they attempt to address this problem by seeking ways to reshape other institutions—in this case, judicial review—so as to minimize the worst aspects of cost-benefit analysis.  They adopt this approach because they are starting from the assumption that cost-benefit analysis is here to stay, so pro-regulatory interest groups better learn how to deal with it.  This line of argument is one that is gaining currency among proponents of stronger regulations, and it is a development that CPR will continue to monitor.

To be sure, the solution that Revesz and Livermore propose for eliminating the deregulatory synergy that exists between judicial review and cost-benefit analysis is far from ideal.  It seems that the far better solution would be to stop using rigid cost-benefit analysis once and for all.  After all, it makes more sense to eliminate one failed institution than to rearrange the entire regulatory world to accommodate that institution’s failings.  But just as regulations promulgated according to cost-benefit analysis are better than nothing, perhaps we will have to accept Revesz’s and Livermore’s solution of remand without vacatur as a solution that is better than nothing as well.

Showing 2,837 results

James Goodwin | May 4, 2009

Judicial Review and Cost-Benefit Analysis: Part II

Last week I discussed how the institution of judicial review has been used to amplify the deregulatory nature of cost-benefit analysis.  This week, I'll talk about some possible remedies. An unusual synergy exists between the institutions of cost-benefit analysis and judicial review.  Under most circumstances, the institution of judicial review is arguably neutral with regard to […]

James Goodwin | May 1, 2009

Judicial Review and Cost-Benefit Analysis

For the last few years now, CPR’s Member Scholars have made the case that cost-benefit analysis is, by itself, fundamentally deregulatory in nature.  Unfortunately, other institutions in our federal government tend to exacerbate the deregulatory nature of cost-benefit analysis.  Whether by design or dumb luck, cost-benefit analysis allows regulatory opponents to use those institutions—most notably […]

Matthew Freeman | April 30, 2009

CPR’s Steinzor Testfies on Regulatory Process

This morning, the Center for Progressive Reform’s Rena Steinzor testifies before the House Science and Technology Committee’s Subcommittee on Investigations and Oversight.  In her remarks, she calls on the White House to reshape the role of the director of OMB’s Office of Information and Regulatory Affairs — the so-called regulatory czar.  All too frequently OIRA […]

David Driesen | April 29, 2009

In Debate on Waxman-Markey, a Question on Avoiding Liability for Violating the Law

A coalition of conservative and moderate Democrats has recommended deleting section 336 of the Waxman-Markey climate change bill because of “concern among industry about potential new liability for any emitter” under that provision (see the proposed amendments). Some polluters’ objective, apparently, is to avoid liability for violating the law, and they recommend this deletion as […]

Matthew Freeman | April 29, 2009

CPR’s Steinzor Testfies on Regulatory Process

This morning, the Center for Progressive Reform’s Rena Steinzor testifies before the House Science and Technology Committee’s Subcommittee on Investigations and Oversight.  In her remarks, she calls on the White House to reshape the role of the director of OMB’s Office of Information and Regulatory Affairs — the so-called regulatory czar.  All too frequently OIRA […]

A. Dan Tarlock | April 29, 2009

The First 100 Days: At Interior, Several Positive Developments, but the Jury is Still Out

This post is written by CPR Member Scholars Dan Tarlock and Holly Doremus How has the Department of Interior fared during the first 100 days? If history is any guide, the issue may be more important than many people assume. With one major and one minor exception, Secretaries of the Interior stay put in Democratic […]

William Funk | April 28, 2009

The First 100 Days: A Positive Beginning on the Freedom of Information Act

There are few areas where the difference between the Republican and Democratic parties is more stark than that of the Freedom of Information Act. The FOIA, of course, requires agencies to provide copies of their records to any person upon request unless the record fits within one of nine specific exemptions. Among the most important […]

Rena Steinzor | April 28, 2009

The First 100 Days: On the Environment, a President to be Proud of; An Agenda Just Beyond Reach

Inside the Washington Beltway, we are awash in stories about President Obama’s first 100 days. Some are comparative—how is Obama doing in relationship to Franklin Roosevelt at the same point in his first term? Some are pure spin—“we’re competent and we love each other!" opines Rahm Emanuel, the obviously biased Obama chief of staff. And […]

Victor Flatt | April 27, 2009

Proposed Amendments to Waxman-Markey Could Diminish Integrity of Offset Provisions

Two weeks ago, Representatives Waxman and Markey put forth a 648-page legislative draft for dealing with climate change. That draft had proposals for the use of offsets, some good and some not so good (see my earlier post). Moderate and conservative Democrats on the Energy and Commerce Committee have now put forward suggested changes (as […]