January 26, 2011
In his first appearance before a panel of the new Republican-led House, the Obama administration's point man on the president's regulatory review on Wednesday promised an increased agency awareness of the burdens that regulations might impose on small businesses and job creation -- eliciting a barrage of skeptical queries from pro-business lawmakers.
Cass Sunstein, administrator of the Office of Information and Regulatory Affairs, after being placed under oath by the chairman of the House Energy and Commerce Oversight and Investigations Subcommittee, said President Obama's Jan. 18 executive order "improves" the existing process for White House regulatory review.
"It stresses the need for predictability and certainty and for using the least burdensome tools for achieving regulatory ends," he said. "It emphasizes the need to measure, and seek to improve, the actual results of regulatory requirements. It calls for retrospective analysis of existing rules. It asks for periodic review to identify rules that may be outmoded, ineffective, insufficient, or excessively burdensome."
And, Sunstein said, "It is aimed at the stock of existing regulations as well as the flow of new requirements," including the unfolding regulations to implement the health care reform law, the financial reform law and the recently enacted legislation revamping the food safety system.
An accompanying Presidential Memorandum on Regulatory Flexibility, Small Business, and Job Creation, Sunstein added, specifically directs agencies to consider methods "to reduce regulatory burdens on small business."
But subcommittee chairman Rep. Cliff Stearns, R-Fla., blasted Obama's approach to regulations in his opening statement. "From our health to our wealth to the freedom to live our lives the way we want, the federal regulatory state continues to grow and intrude," he said. He said agency regulators had "thrown rational, quantitative cost-benefit analysis out the window" in favor of "amorphous, subjective language and politically correct ideology."
Calling agencies' pace during the past two years "breathtaking," he said the Obama regulatory agenda released this fall identified 4,225 rules under development and that the Environmental Protection Agency alone has finalized 928 rules under Obama. He said that while the George W. Bush White House in its first two years sent 19 "return letters" to agencies demanding they reconsider regulations, Obama had sent none.
Stearns also expressed concern that the new regulatory review does not cover independent agencies such as the Securities and Exchange Commission, the Federal Energy Regulatory Commission, the Federal Communications Commission, and the Federal Deposit Insurance Corp.
Sunstein replied that the number of new rules released during the past two years is the same as it was in the last two years of the Bush administration.
Ranking subcommittee member Rep. Diana DeGette, D-Colo., countered that only Congress can change OIRA's powers to review regulations by independent agencies, a statement Sunstein confirmed with the qualification that OIRA monitors independent agency information flow under the 1980 Paperwork Reduction Act. He said Obama's OIRA handles those agencies in the same manner that the Reagan and two Bush administrations did.
Energy and Commerce Committee Chairman Rep. Fred Upton, R-Mich., told the hearing that Congress could consider bipartisan legislation to change this setup.
Former Energy and Commerce chairman Rep. Henry Waxman, D-Calif., cautioned Republicans against using rhetoric that "paints with too broad a brush." He said, "efforts to demonize the regulatory process are not new," recalling that back in the mid-1990s, newly empowered Republicans claimed that the Consumer Product Safety Commission was requiring buckets to have holes in them to prevent drowning, and that the Occupational Safety and Health Administration had "killed the tooth fairy" by declaring baby teeth to be "hazardous waste." Both were shown to be false, he said.
Waxman and other Democrats sought to highlight the benefits of recent regulations to health, energy independence, national security and clarity for industry. They mentioned last April's fuel economy standards released by EPA and the National Highway Traffic Safety Administration, as well as EPA's controversial emission control limits for industrial boilers using Maximum Achievable Control Technology.
But Republicans such as Rep. Joe Barton of Texas pressed Sunstein on whether the EPA plans to change any of its recent rules and whether it considers the effect on jobs when it writes regulations. "You've done nothing to slow this down," Barton said.
Sunstein said his office is working closely with EPA and the agency is planning to make changes to rules, based on scientific findings and data, to achieve more simplicity. "Every rule that imposes significant costs we are concerned about," he said.
Rep. John Sullivan, R-Okla., saying he was bothered by the Obama order's language such as "equity, human dignity, fairness and distributive impacts," asked the witness, "How do I explain this gobbledygook to business?"
"It's not meant to be an all-purpose qualifier on regulations on business," Sunstein said. He explained that equity referred to manufacturing regulations addressing such cases as deaths of children accidentally run over by parents driving cars not designed with proper rear visibility. He said the term dignity addressed such considerations as access to bathrooms by people who use wheelchairs.
Freshman Rep. Cory Gardner, R-Colo., complained he regularly meets with business executives who say Washington "is regulating me out of jobs and out of business." He demanded, "How do we define benefits and what constitutes burden?"
At one point Sunstein was asked if he could promise that a particular regulation would not cost any jobs. The premise is "preposterous," he replied. "If a regulation saves 10,000 lives but costs one job, it's worth it."
January 26, 2011