This afternoon, the House Judiciary Committee’s Subcommittee on Regulatory Reform, Commercial, and Antitrust Law will hold an oversight hearing that looks at the Office of Information and Regulatory Affairs (OIRA), the powerful White House bureau that sits at the center of the regulatory universe.
Originally created to oversee federal agencies’ implementation of the Paperwork Reduction Act, a series of presidential executive orders stretching back to the Reagan administration has endowed OIRA with a powerful gatekeeping role over executive agencies’ rulemaking output: no final rule of any consequence can see the light of day without OIRA’s imprimatur. As CPR has documented for several years now, OIRA has generally wielded this power in an anti-regulatory fashion, typically working on behalf of politically connected industry lobbyists to block, delay, or dilute public safeguards. This pattern has held for presidential administrations from both parties.
Headlining the hearing is OIRA Administrator Howard Shelanski. He is set to appear as the sole witness in the hearing’s first panel.
Predictably, the Republican majority on the committee has also lined up a second panel with the usual suspects of anti-regulatory advocates as witnesses. If history is any guide, we can expect them to trot out their standard litany of anti-regulatory gripes, followed by sanctimonious calls for OIRA to step up and crack down on “unaccountable bureaucrats” and “regulatory overreach.”
Fortunately, CPR Member Scholar David Driesen, a leading expert on cost-benefit analysis and the role of OIRA in the rulemaking process, will be on hand as part of the second panel to offer a measure of reason. Professor Driesen’s testimony provides a compelling reminder of the invaluable role that regulation plays in enhancing the quality of life for all Americans and for promoting essential social values and goals that the free market is incapable of producing on its own. It also provides an important critique of OIRA’s centralized regulatory review process and the use of cost-benefit analysis as a measuring stick for evaluating the quality of regulatory decision-making.
Much of Professor Driesen’s testimony is focused on the practical and theoretical problems with cost-benefit analysis and OIRA centralized review. On cost-benefit analysis, he points out that it is impossible to “reliably and objectively quantify the costs and benefits of most government standards, because of data gaps and huge uncertainties.” Describing his own empirical research, Professor Driesen also provides a powerful account of how OIRA’s review role functions as a “one-way ratchet” — that is, he explains how OIRA’s interventions in individual rulemakings serve almost invariably to weaken safeguards and virtually never to strengthen them.
Professor Driesen closes his testimony by offerings several recommendations for overhauling the practices of cost-benefit analysis and OIRA centralized review to minimize or avoid their anti-regulatory consequences.
The hearing is scheduled for 3 p.m. on Wednesday, July 6 and will take place in Room 2226 of the Rayburn House Office Building.