Cass Sunstein, administrator of the Office of Information and Regulatory Affairs (OIRA), recently outlined how he and others in the White House Office of Management and Budget were eliminating bureaucratic red tape in the executive branch agencies. In fact, while the rollout of the White House’s widely touted regulatory reform initiative may have started with a bang, it has followed with a whimper. In contrast to the fanfare surrounding issuance of Executive Order 13563, or his May 26 announcement of the preliminary results of a government-wide review of the current morass of federal regulations, Mr. Sunstein’s Aug. 23 release of final agency plans to scale back regulations was, for the most part, a non-event.
Rather, the Obama administration’s latest announcement is sadly nothing more than a Band-Aid to treat our nation’s severed economic artery at a time when investment has all but evaporated and jobs are scarce. From industrial giants to small business start-ups, our nation’s job creators are sitting on trillions of dollars in capital because they are concerned with the countless regulations created by the Obama administration, all of which are adding uncertainty to the oppressive regulatory environment.
Mr. Sunstein has appeared twice before the subcommittee I lead within the House Committee on Energy and Commerce. At a Jan. 26 hearing, I took issue with the amorphous standard for regulatory review set out in Executive Order 13563 and specifically, that “where appropriate and permitted by law, each agency may consider (and discuss qualitatively) values that are difficult or impossible to quantify, including equity, human dignity, fairness and distributive impacts.” I was concerned then and continue to be until this day that reliance on such imprecise criteria may subvert any serious attempt at cost-benefit analysis.
At this and a subsequent hearing, on June 3, my colleagues and I also shared with Mr. Sunstein our concern that the president’s gestures toward regulatory relief are likely to ring hollow, especially as some agencies such as the Department of Health and Human Services, punt most of their relief savings down the road. While some very outdated rules might be cut back or eliminated, the Obama administration is doing nothing to slow the ongoing regulatory juggernaut of the Environmental Protection Agency (EPA) nor address the thousands of pages of bureaucratic burdens released so far to implement a massive takeover of health care and the controversial financial reform bill.
At the same time, while OIRA estimates that the regulations issued by the independent agencies have a $230 billion per year impact on the U.S. economy, Executive Order 13563 does not apply to these agencies, which include the Federal Communications Commission, the Consumer Product Safety Commission, the Federal Trade Commission, and the Nuclear Regulatory Commission. In light of this, independent regulatory agencies have contributed negligibly, if at all, to the overall aim of eliminating government red tape, which was heralded by OIRA’s August announcement. The July 11 issuance of Executive Order 13579, applying the original order to independent agencies as well - only days after my subcommittee’s oversight hearing identified this gap in the administration’s regulatory reform effort among the independent regulatory agencies - is undoubtedly a positive step forward.
Regulatory relief is essential to boosting job creation. That is why it plays a leading role in the GOP’s Plan for America’s Job Creators, released earlier this year. Reducing the regulatory burden on American companies, especially small business, is paramount for economic recovery. President Obama’s recent request that the EPA withdraw its controversial proposal to voluntarily revisit a 2008 ozone standard - a plan that the agency itself projected would impose annual costs of as much as $90 billion - is a belated, albeit welcome, admission by the president that ill-considered regulations do, in fact, have a negative impact on the economy. While his efforts are to be commended in that particular case, there still is much to be done to cut red tape in America.
Mr. Sunstein has spoken repeatedly about the need to create a new regulatory culture across the executive branch and I agree with him. Unfortunately, even as I wrote this, the Obama administration pushed new regulations affecting many sectors of industry and wide-reaching aspects of American life were being created by the same flawed system that produced the regulations we are coping with today. I sincerely hope Mr. Obama’s recent decision to withdraw EPA’s proposed ozone standard portends a renewed push to rework our nation’s regulatory culture into one that ensures the public health and welfare by embracing pro-growth, common-sense solutions, and I look forward to having Mr. Sunstein testify in the very near future regarding these efforts.
Rep. Cliff Stearns, Florida Republican, is chairman of the House Energy and Commerce Committee’s Subcommittee on Oversight and Investigations.
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