GRAY: Regulatory reform is job one

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ANALYSIS/OPINON:

The upcoming election presents a referendum on the incumbent Obama administration’s record. Given the ongoing economic malaise, this referendum will focus primarily on the administration’s mishandling of the economy, on taxes and spending, and on massive legislative programs. But any review of the administration’s record would be woefully incomplete without scrutinizing the president’s extraordinary abuse of executive authority. Repairing the damage wrought by this administration will present a major challenge — and opportunity — for a Mitt Romney administration.

President Obama’s record is intellectually incoherent. His most infamous achievements have been legislative acts, passed by Congress: Obamacare for health care reform and Dodd-Frank for financial reform, to name the two most immediate examples. But while he signed those laws, he was relatively uninvolved in their actual formulation, choosing instead to let Rep. Nancy Pelosi of California and Sen. Harry Reid of Nevada devise these laws in Congress.

Instead, while Congress wrote those landmark laws, Mr. Obama focused his administration’s energies on exploiting, at the expense of Congress, statutes already on the books — the Clean Air Act, No Child Left Behind, and the 1990s welfare reforms, among others. Nominally invoking those statutes, Mr. Obama asserted unprecedented executive authority without congressional approval or involvement.

Upon taking office, the president focused first and foremost on the Clean Air Act. On the campaign trail, he marked his victory in the Democratic Party primaries by declaring that “this was the moment when the rise of the oceans began to slow and our planet began to heal.” A year later, he matched that grand environmental vision by determining, through his Environmental Protection Agency, to establish a sweeping climate-change regime that will never have long-term stability or legitimacy unless approved by Congress.

These and other EPA regulations not only will cost Americans a fortune but also pose a direct threat to the stability of America’s power grid. In 2011, staff at the Federal Energy Regulatory Commission concluded that the EPA’s regulations threatened to shutter nearly 8 percent of American electric generation capacity, increasing the risk of blackouts during times of peak usage.

Under other statutes, the Obama administration has attempted to effectively rewrite the law, using broad assertions of “waiver” authority. The Department of Education is offering to waive the No Child Left Behind Act’s accountability requirements, as long as state and local leaders adopt curricula reflecting the administration’s policy preferences — in short, a flagrant evasion of the federal prohibition against a “national curriculum.” Meanwhile, the administration is attempting to nullify the 1990s welfare reforms by waiving the work requirements for welfare.

By radically changing or even nullifying long-standing statutory law, the administration’s regulatory agenda injects all the more uncertainty into the economy and into state and local governance. It replaces the rule of law with the vicissitudes of rule-by-regulator.

Astonishingly, matters could have been even worse.

The federal courts saved us from a number of Mr. Obama’s regulatory efforts, by overturning new regulations that were either unlawful or unsupported by factual record. According to the American Action Forum’s latest research, courts have vacated rules costing the American public more than $4.6 billion; most recently, the U.S. Court of Appeals for the D.C. Circuit vacated the “Cross-State Air Pollution Rule,” which attempted to impose severe emission restrictions on states, using reasoning rejected once before by the D.C. Circuit. Unfortunately, those rulings are barely a drop in this administration’s bucket. In the past three years, the Obama administration has imposed more than $450 billion in regulatory burdens. Ultimately, the public’s recourse must be not the courts, but a new president and Congress.

We have been here before. In 1980, Ronald Reagan campaigned on issues of regulatory reform, and so he took office in 1981 with a mandate to achieve major changes. And that is precisely what he did once in office: He issued a landmark executive order reasserting control over regulatory agencies, he required agencies to consider regulations’ actual costs and benefits, and pressed them to seriously consider federalism and other fundamental questions. Mr. Romney and Rep. Paul Ryan of Wisconsin are perfectly suited to achieve a similar record of regulatory reform, beginning with undoing the Obama administration’s unilateral executive action. But to do so will require an electoral mandate, something that can be achieved only by making regulatory reform a central part of their campaign.

C. Boyden Gray previously served as White House counsel and U.S. ambassador to the European Union, and helped to lead the Reagan administration’s regulatory reform efforts. Douglas Holtz-Eakin, president of the American Action Forum, previously served as chief economist of the President’s Council of Economic Advisers and as director of the Congressional Budget Office.

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