This post was co-written with my colleague, Ben Chou.
Deregulation is the flavor of the month in Washington, D.C., and the U.S. Congress is Baskin-Robbins.
Recently, Representative Don Young (R-AK) made headlines by saying he was going to introduce legislation to repeal all federal regulations adopted in the last 20 years. If he makes good on this threat, the bill would invalidate federal rules adopted in 2000 implementing the Black Lung Benefits Act and recent updates to the requirements for public accommodations and commercial sites under the Americans With Disabilities Act, just to name a couple of a host of public health, civil rights, workplace safety, environmental, transportation safety, food quality, and homeland security safeguards that have been adopted over the past two decades.
This is a laughably radical notion, of course, and it would be scarcely worth mentioning if it were the only such idea being considered by members of Congress. In fact, it’s just the least well-disguised one.
An equally radical bill has been introduced by Senators Rob Portman (R-OH), Mark Pryor (D-AR), and Susan Collins (R-ME). Rather than attempt to go back in time like Representative Young, these Senators have authored a bill that promises to kill all manner of future regulatory safeguards. But it does so quite cleverly – by throwing several monkey wrenches into the gears of agency action, providing new and unnecessary administrative hurdles to regulatory requirements, and creating rules of decision that will often favor doing nothing over protecting the public.
Regulation Isn’t a Four-Letter Word
Before getting into the nitty-gritty of this bill, it is worth remembering some of the things regulatory agencies do to keep us safe, healthy, and able to live our lives free of discrimination. A few examples:
- The Environmental Protection Agency’s regulations establish levels of pollutants that dozens of different industries are allowed to discharge into the nation’s waterways, based on available technologies to reduce such pollution. EPA also sets out how much treatment our sewage must receive before being discharged.
- The Department of Transportation has rules that require truckers not to perform “safety-sensitive functions” within four hours of consuming alcohol.
- The Food and Drug Administration is responsible for determining what levels of various “natural or unavoidable defects in foods” do not create health risks. For instance, this includes – just looking at the first one in alphabetical order – allowing for no more than an “[a]verage of 30 or more insect fragments per 10 grams” of ground allspice.
For even more illustrations, several months ago, a group called Federally Employed Women did a great piece – an hour-by-hour summary of a day in the life of a hypothetical person helped by various government initiatives. (Granted, some of the items are a stretch – the dream sequence from 1:00-3:30 AM comes to mind – and some of these agencies actually could use a kick in the pants to better look out for the public, but the concept is pretty cool.)
Obviously, making these kinds of judgments requires scientific, economic, engineering, and other expertise. And that’s what administrative agencies have – subject matter experts that implement the laws that Congress passes regarding specific topics. Members of Congress lack the specialized knowledge, staff, and time to draft laws that specifically address the innumerable different issues that face our society. Accordingly, Congress enacts broader directives and leaves it to administrative agencies to carry out the law by way of more situation-specific regulations. Another benefit to this approach – agency staff people aren’t constantly running for re-election and trying to curry favor with industry supporters.
Think of it this way: no matter how much you love your representatives in Congress, ask yourself – do you think they would do a good job deciding how many insect fragments can be in your allspice?
The “Regulatory Accountability Act” Threatens Public Protections
Against this backdrop comes the bill from Senators Portman, Pryor, and Collins. As my colleague, Daniel Rosenberg, explained in detail, this act would completely rewrite the Administrative Procedure Act, which has guided federal agency rulemaking for over 60 years. It will allow industries and polluters more opportunities to challenge and thwart rules that they deem too inconvenient.
For instance, the bill would add a new level of administrative process to many rulemakings. It would establish extended minimum time periods before an agency can take several steps in the rule-writing process, so that rules by necessity will drag out over years. Depending on the significance of the rulemaking effort, the bill also provides opportunities for industry to force an agency to hold an one or more formal hearings, in which particular pieces of agency evidence or agency findings could be challenged in an elaborate trial-style proceeding, and could also be challenged later in a separate court case. Together, these hassles make it very difficult to even navigate the regulatory process for a new or tighter public safeguard.
On top of these new roadblocks, the law would superimpose cost-benefit analysis on the rulemaking process and would generally require agencies to adopt “the least costly alternative” considered unless the agency can demonstrate that the public health, safety, or welfare benefits provided by any “more costly” alternative chosen outweighs the additional costs.
Why is that unreasonable? It is no secret that conventional cost-benefit analysis often fails to properly monetize the benefits of clean air and water and similar societal values. One complication, for instance, is the difficulty of ascribing dollar values to intangible environmental benefits (e.g., healthy ecosystems). This has been demonstrated most recently with EPA’s haphazard analysis for the proposed power plant cooling water rule, which underestimated the benefits of reducing fish kills associated with cooling water intake structures (you can read more about the proposed rule here).
This is a common problem. Indeed, many of the industry-specific pollution limits I mentioned above have costs that exceed their quantified benefits. SImilarly, when EPA commissioned an examination of the costs and benefits of the entire Clean Water Act in 2000, the end product was extremely limited, focusing on just two of 45 benefit categories identified, as depicted in the figure below, copied from the benefits report.
Even with that limited analysis, the benefits (about $11 billion/year) were close to the costs ($14.1 billion/year), such that it is reasonable to expect that the law has been an economic positive over time. The accompanying cost report suggests the same, saying, "The CWA benefits were estimated in a separate study under a strict set of assumptions, and they only apply to a subset of the nation's surface waters and water pollutants. Nonetheless, these partial estimates, which amounted to approximately $11 billion per year in the mid-1990s, are relatively close in magnitude to the CWA cost estimates from this study. Although these results are suggestive, more detailed analysis, particularly of the benefits, will be needed to draw stronger conclusions regarding the benefit-cost performance of the CWA."
Because of these difficulties, the new Senate deregulatory bill would further restrict EPA’s ability to adopt rules to protect our water resources from pollution under the Clean Water Act because these rules might be deemed too costly or too burdensome to polluters while ignoring the numerous benefits that clean water provides to the public and environment.
The groups that support this act would have you believe that regulations commonly thwart economic growth and kill jobs, so that it’s a good thing to effectively bring the rulemaking process to a halt. But in reality, only 13 percent of small business owners in a recent survey think regulations are their biggest problem. Also, as another colleague, Scott Slesinger, has pointed out--when challenged, none of the sponsors of the new anti-regulation bill could point out a single rule that has cost jobs. They are just pushing the same, tired meme of “job-killing regulations” and hoping that no one is paying attention to the details.
One final point -- in case you have any lingering doubt that these bills are just meant to kill public safeguards and aren’t serious attempts to add more rigor to the regulatory process, take a look at the many protective administrative actions that members of Congress have attacked even though the estimated benefits exceed their costs. For instance, as I’ve written, the Republican House leadership has gone after a good-government initiative by EPA and the Army Corps to clarify what water bodies are protected by the Clean Water Act, even though the initiative’s estimated annual benefits of $162 million to $368 million compare favorably to its predicted costs of $87 million to $171 million per year.
I guess some members of Congress just never met an attack on public safeguards they didn’t like.