When the president issues an executive order, Cabinet-level departments get in line with administration policy. Though independent regulatory commissions (technically not part of the administration) are not required to follow executive orders, they usually try. After all, the agencies’ leaders are presidential appointees, and executive policy should be consistent across the executive branch. Given this, it is curious that the U.S. Consumer Product Safety Commission (CPSC) effectively has chosen to disregard the White House’s directions on regulatory reform.
The president gave agencies three important tasks in two executive orders last year: Develop a plan to review and fix regulations, use cost-benefit analysis in writing new ones, and figure out how to reduce their paperwork burden. The point of these tasks is to ensure that agencies pursue their missions while creating an environment where the economy and jobs can grow and thrive. My agency’s failure to do any of these tasks jeopardizes that goal. Let’s look at each task.
Task 1: Fix regulations. In Executive Order 13579, the president asked agencies to develop plans to eliminate or improve regulations that are not justified. As Cass Sunstein, the president’s director of information and regulatory policy, described it, agencies are supposed to “produce plans to reassess and to streamline their existing regulations, and to disclose those plans for public scrutiny” so that the agencies have “smart, cost-effective regulations, designed to promote economic growth and job creation.”
How has the commission responded? Tepidly, at best. Granted, this past spring we started developing a policy to direct how we review, revise or revoke out-of-date rules. But this month, on a 2-2 vote, we failed to adopt any policy. I joined my colleague Anne Northup in arguing for a rule-review plan that would have focused on fixing our most burdensome rules. My other colleagues voted for a plan that allows focusing on small rules such as eliminating superfluous regulations on toy cap guns or restating our animal testing policy. These things may be appropriate as regulatory “housekeeping,” but let’s not pretend that doing them will create any jobs, ease any burdens on the marketplace or increase safety.
Task 2: Employ cost-benefit analysis. The president tasked us with using cost-benefit analysis as a tool to assure that the benefits of new rules outweigh their costs. This is a continuation of past administrations’ policies, and it ensures that agencies create rules that impose the lowest burden on the consumers and the economy.
The reaction of the commission? A Democratic majority specifically declined to perform this rational and sensible analysis for rules recently adopted that are laden with regulatory requirements. Indeed, one commissioner said cost-benefit analysis would be done “over my dead body.” The chairman advocates against using cost-benefit analysis for key rules, most recently repeating this position at a congressional hearing earlier in the summer. This means that rules get rushed out, and they may impose burdens without commensurate safety benefits.
Task 3: Reduce paperwork. Another key presidential directive concerned reduction of paperwork burdens. Needless paperwork helps no one, so one specific White House request to each agency was to identify at least one initiative that would reduce at least 50,000 hours in annual paperwork burden.
Here at the Consumer Product Safety Commission? In July, we voted on a proposal that would require an estimated 640,000 new paperwork hours in the first year and up to 256,000 more hours annually. This proposal would amend last year’s testing rule, which already created extensive record-keeping requirements for manufacturers of children’s products. By our own admission, the information collected by this proposed new record-keeping requirement would rarely be used. The price tag for this new paperwork requirement is estimated to be as high as $32.5 million the first year, plus $13 million each subsequent year, with the burden falling most heavily on small businesses. This requirement is not in the spirit of the White House directive, is not good regulatory policy and does not advance safety.
The commission is a small agency with a big mission. We protect consumers from unreasonable risks of injury from consumer products. Consumers are not protected when the government imposes requirements that drive up costs without offsetting benefits. Jobs are lost when outdated, burdensome rules stay on the books. Private resources are squandered when they are used to pay for unjustified paperwork. Public resources are diverted from real risks. Consumers — the American people — should expect more from their public officials.
Nancy Nord has been a commissioner on the U.S. Consumer Product Safety Commission since 2005 and is a former acting chairman.
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