Citizen Health & Safety
Congressional Briefing Debunks Anti-Regulatory Myths Behind "Reform" Bills
by Katie Greenhaw, 7/2/2013
Last week, members of the House hosted an expert panel discussion to set the record straight on recurring anti-regulatory myths and dangerous legislative proposals. Aptly titled "Anti-Regulatory Myths: What Regulatory Critics Don't Tell You," the congressional briefing highlighted the importance of much-needed safeguards and debunked the most common misconceptions surrounding the regulatory process and the impacts of rules.
Co-hosted by Reps. John Conyers (D-MI) and Steve Cohen (D-TN), along with the Coalition for Sensible Safeguards and the Center for Progressive Reform, the panel convened to brief congressional staffers, members of the press, and the general public about the complex processes that agencies must navigate before they can issue important health, safety, and environmental protections. The panelists refuted claims about the cost of rules, identified the real regulatory problems that policymakers should address, and carefully critiqued the harmful anti-regulatory bills currently pending in Congress.
The Truth about Regulatory Costs and Benefits
The panel discussed one of the most common tactics employed by regulatory opponents – to exaggerate costs and ignore benefits. For years, high cost estimates have been used to justify an anti-regulatory agenda even though the most commonly cited estimates are unreliable. Industry lobbyists and even some members of Congress continue to rely on a 2010 study that experts have thoroughly discredited, and even its authors, Crain and Crain, have distanced themselves from. In fact, Cass Sunstein, then the administrator of the Office of Information and Regulatory Affairs (OIRA), referred to this estimate as "an urban legend," and the chairman of the Council of Economic Advisers called the figure "utterly erroneous."
Claims that rules are too costly rarely acknowledge regulatory benefits, but the evidence shows that the benefits of rules overwhelmingly exceed the costs. And even these estimates may undervalue the benefits. The actual benefits are likely much higher because many benefits cannot be quantified or easily translated into dollars and cents. Moreover, industry often overestimates the costs of implementing new standards: when required to comply with public protections, businesses generally choose the least expensive way to do so.
What's Really Wrong with the Regulatory Process and How to Fix It
The panel discussed a number of barriers to effectively protecting the public, including regulatory delays and inadequate agency resources. Endless procedural hurdles and analytical requirements increase the time it takes to issue rules. The process has become so ossified that it currently takes four to eight years for an agency to complete significant standards. After the new rule has made it through this onerous review process, agencies may not have sufficient resources to fully implement and enforce the new standards.
The costs of failing to regulate and enforce safety standards can be substantial, and the consequences devastating. Panelist Peg Seminario of the AFL-CIO explained that the cost of not regulating occupational safety and health ranges from approximately $250 billion to $300 billion per year. This cost comes in the form of workplace injuries, illnesses, and fatalities. Only 25 percent of this cost is absorbed by workers compensation programs. The remaining 75 percent is paid by the injured workers and their families, insurance companies, and taxpayers. Panelist Sid Shapiro noted that the failure to regulate can also contribute to catastrophic events that impose massive costs on society, including the BP oil spill and the collapse of Wall Street.
The panelists agreed that the process must be streamlined to reduce delays, and Congress should increase funding to ensure agencies have the resources necessary to fulfill their missions.
Current Regulatory "Reform" Proposals Are Harmful, not Helpful
Several regulatory reform proposals are pending in Congress that purport to improve the regulatory process. But in reality, these bills would increase delays and provide more opportunities for regulated industries to influence rulemaking outcomes. Panelist John Walke of the Natural Resources Defense Council (NRDC) warned that these bills are indirect attacks on the implementation, enforcement, and effectiveness of standards that are authorized by statutes too popular to amend or repeal. These reforms, he explained, are designed to make it harder for agencies to issue the rules that implement laws like the Clean Air Act (CAA) and Clean Water Act (CWA), which would be difficult to amend or repeal given the broad public support for health and safety protections.
The panel discussed several familiar bills that have been reintroduced this year:
- The Regulations from the Executive in Need of Scrutiny (REINS) Act (H.R. 367) would require congressional approval of all major rules, potentially endangering the most important safeguards to our health, safety, environment, and economy. The bill would require that Congress approve standards and safeguards within 70 legislative days. If both chambers fail to meet this deadline, the rules in question would be "tabled," essentially killing them. Given the gridlock in Congress, the REINS Act would make it impossible for agencies to carry out the mandate they have been given to safeguard Americans' air, water, food supply, and workplaces.
- The Regulatory Accountability Act (RAA) appears less drastic than REINS, but it would still undermine the rulemaking process. Full of procedural hurdles, inflexible analyses, and opportunities for non-experts to interfere with agency judgments, it would obstruct agencies' ability to protect the public from harm.
- The Independent Agency Regulatory Analysis Act of 2013 (IARAA) (S. 1173) would fundamentally change the way independent agencies operate by granting the White House more control over rulemaking. Congress often establishes an independent agency when it wants certain policies insulated from White House interference. The bill would politicize independent regulatory agencies by taking away much of their autonomy. They would have to spend limited resources completing detailed cost-benefit analyses – even when Congress has not required this – and submit their analyses for OIRA review. Congressional members and staff should resist handing over control of independent agencies to the White House.
- The Sunshine for Regulatory Decrees and Settlements Act (S. 714 and H.R. 1493) is disguised as an effort to increase transparency, but it aims to bog down the regulatory process with time-consuming and costly procedural hurdles that would limit the lawsuits brought to challenge unreasonable delays by regulatory agencies. Walke explained that, contrary to the myth that settlements dictate rulemaking outcomes, agencies must still follow notice and comment procedures. The truth is that settlements do not preclude public participation, and they are valuable tools the public can use to ensure that agencies are implementing the laws Congress passes in a timely fashion.
The briefing providing important information at a crucial time when regulatory opponents continue to echo myths and propose changes that would serve only to further weaken the regulatory system. It is the failure to regulate that is most damaging to the American people, and the monetary and quality-of-life costs are striking. So far this summer, 15 workers have died on the job while occupational safety and health rules are mired in a dysfunctional process. Adding more procedural hurdles and rulemaking roadblocks will only make the problem worse. Changes that help agencies improve and modernize health and safety standards are needed to protect workers and safeguard our health and environment.