Cross-posted from the Economic Policy Institute's Working Economics blog. Isaac Shapiro is EPI's Director of Regulatory Policy Research.
The House of Representatives is poised to vote for the REINS (Regulations From the Executive in Need of Scrutiny) bill today; this would come on top of votes on two bills last week that would also upend the regulatory process. These efforts are premised on assertions that regulations are greatly damaging the economy, and David Brooks’ op-ed Tuesday is another timely reminder that these assertions are inaccurate. He opens with:
“Republicans have many strong arguments to make against the Obama administration, but one major criticism doesn’t square with the evidence. This is the charge that President Obama is running a virulently antibusiness administration that spews out a steady flow of job- and economy-crushing regulations.”
And closes with:
“They regulations are not tanking the economy.”
In between, he cites a few relevant facts to support his view that “regulations are not a big factor in our short-term economic problems.” These include the Bureau of Labor Statistics data which show that during the first half of 2011, just 0.18 percent of mass layoffs were due to regulations. EPI President Lawrence …
New York Times columnist David Brooks weighs in this morning on CPR’s latest report, Behind Closed Doors at the White House: How Politics Trumps Protection of Health, Worker Safety and the Environment. To his credit, he begins by dismissing one of congressional Republicans’ principal lines of argument for 2011 – that an imagined tsunami of Obama Administration regulatory excess is somehow at the root of the nation’s economic distress. In fact, almost any economist will tell you that we got into this mess because of under-regulation, and that the current challenge is depressed consumer demand, not regulation.
From there, Brooks gets a little lost in the sauce. Most significantly, he displays a sort of man crush on Cass Sunstein, head of the White House Office of Information and Regulatory Affairs, and the President’s “regulatory czar.” Sunstein’s small office of economists plays an outsized role …
The CPR white paper on OIRA earlier this week looked at how this little office within OMB facilitates an industry-dominated process that serves to weaken regulations proposed by federal agencies. Appearances by industry representatives have outnumbered those by public interest lobbyists more than 5-to-1 in meetings at OIRA in the last ten years, the paper found (3,763 to 708, for the record).
Does it have to be this way?
The Obama Administration has said on numerous occasions that it has an “open door” policy at OIRA. But while “open door” sounds good in theory, the hard evidence shows that this very policy facilitates industry’s domination of the process.
The Administration has actually defended the open door policy by going one step further, such as with these words from then-OMB spokesman Tom Gavin:
Gavin said the White House office is required by executive order to meet …
The “Regulatory Flexibility Improvements Act” (RFIA) and the “Regulatory Accountability Act” (RAA) are headed for votes on the House floor shortly (today and/or tomorrow). The “Gum Up Public Health and Safety Protections Act” apparently wasn’t going to sell as well.
A quick recap of the Regulatory Accountability Act, via CPR Member Scholar Sidney Shapiro’s Congressional testimony on the bill in October:
Republicans in the House have spent much of the fall trying to blame regulation for the nation’s slow economic recovery. The fact that there is no reasonable evidence to back up this claim is apparently not a concern for the regulatory opponents. Moreover, regulatory opponents skip entirely over the impacts of the failure to regulate, pretending that while regulation imposes costs on the economy, the failure to regulate does not.
Now, there is even more evidence of that regulation cannot be blamed for our current economic woes. The head of the Congressional Budget Office has testified that regulation is not a drag on the economy. And we have learned from a terrific AP report that the same business firms that have told Congress that proposed environmental regulations are a serious problem have told the Securities and Exchange Commission (SEC)—the federal regulatory body that regulates the …
When former Harvard Law Professor and eclectic intellectual Cass Sunstein was named administrator of the Office of Information and Regulatory Affairs (OIRA), conservative, industry-oriented Wall Street Journal editorial writers enthused that his appointment was a “promising sign.” A slew of subsequent events has proved their optimism well placed, as we have noted repeatedly in CPRBlog.
But nothing beats hard, empirical evidence. In a report released today, CPR announces the results of an exhaustive six-month analysis of the barebones information OIRA has eked onto the web regarding 1,080 meetings held over a ten-year period (October 2001-June 2011) with 5,759 outside lobbyists, 65 percent of whom represented industry and 12 percent of whom represented public interest groups. The results were shocking even to us, long-time and admittedly jaded observers of OIRA’s one-way ratchet toward weakening public health and other protections.
Former Senator Blanche Lincoln, currently heading an anti-regulatory campaign called “Small Businesses for Sensible Regulation,” appeared on CNBC on Friday to make her case. Lincoln’s been busy trying to use different iterations of a debunked SBA report claiming astronomical costs for regulations. This time she skipped that piece, but offered this take (at 3:15):
This is the single most important issue to small businesses. It’s the biggest threat. The compliance with government regulations that don’t make sense, that cost ‘em money, and keep ‘em from creating jobs is the biggest problem they’ve got.
But even the staunchly right-wing, anti-regulatory National Federation of Independent Businesses, which proudly sponsors the campaign Lincoln heads, finds otherwise in their own surveys of their members (business owners that represent a share – but not exactly the full spectrum – of the small business sector). NFIB’s latest survey has …
Remember that kid on the playground who always insisted on changing the rules of the game and then still threw a tantrum when he lost? That’s just the kind of spoiled-brat behavior we’re seeing from the coal industry and its elected agents on Capitol Hill this week. Coal and other polluting industries have spent decades complaining about the federal laws that protect public health and the environment, arguing that we should change the rules by which they operate, forcing agencies to perform complicated cost-benefit analyses before they can impose limits on polluters. They’ve always figured (and mostly they’re right) that cost-benefit analysis would result in less stringent regulation, because the benefits of protecting public health and the environment are so difficult to quantify and monetize that agencies will end up undercounting them in comparison to costs.
Imagine their disappointment, then, when Lisa Jackson …
If I didn’t know better, I’d think Blanche Lincoln was trying to fool us. The former Senator currently heads the National Federation of Independent Business’s anti-regulatory campaign, and is in DC today to push for a freeze on new regulations. For her accompanying op-ed in Politico, how would she make the case that regulations are a huge problem?
Back in August, Lincoln wrote that regulations cost the U.S. economy $1.75 trillion a year, according to a report commissioned by the Small Business Administration in September 2010. But that study was thoroughly debunked, by a CPR paper, by the Congressional Research Service, and by the Economic Policy Institute.
Two people, CPR President Rena Steinzor and Public Citizen President Robert Weissman, specifically criticized Lincoln’s use of the thoroughly debunked number. In a subsequent post, Lincoln didn’t mention “$1.75 trillion” but instead …
Cross-posted from Legal Planet.
Of course, not everyone agrees that CBA is good in the first place. It remains anathema to many environmentalists. My own view is that it can be a useful tool so long as its limitations are clearly understood.
But just because something is good doesn’t mean that more is better. My grandmother’s view was that if a recipe called for two eggs and one tablespoon of butter, four eggs and two tablespoons would produce an even tastier result — a theory that did not always prove valid. Sometimes, you really just need two eggs!
The same is true of cost-benefit analysis. There are a number of proposals in Congress to expand cost-benefit analysis to cover many additional regulations. A very thoughtful analysis from the Congressional Research Service points out that these proposals may not themselves pass a cost-benefit analysis:
Although there is …