As expected, the White House included several threats of new anti-regulatory initiatives in today’s budget release to Congress. As OMB Watch reported earlier, the White House used the occasion of the budget release to announce two proposals for creating unelected commissions with far-reaching powers to weaken protections of the public health, safety, civil rights, and environment:

• The first plan would force all government programs to plead for their lives on a periodic basis. (Some reports suggest that the sunset period would be 10 years, but the text in the president’s budget did not otherwise specify the time frame.) All programs would automatically expire at the end of the sunset period unless Congress affirmatively votes to retain them. A “sunset commission” would conduct reviews of the programs’ effectiveness and establish the basis for Congress’s decision. This plan would effectively force all programs — which range from foster care funding for abused and neglected children to the entire Occupational Safety and Health Administration, the agency charged with protecting America’s workers on the job — to divert resources from their vital missions into justifying their continued existence.
• The second plan would allow for ad hoc commissions charged with reviewing administration proposals for restructuring or eliminating programs in order to “improve performance and increase efficiency.” These proposals would then be fast-tracked through Congress. In essence, the White House would be empowered to usurp Congress’s own priorities for its agenda and force it to consider proposals for wide-ranging transformations in the structure of American government. Although the proposals to “consolidate” and “streamline” programs would seem initially more structural than substantive, structural changes can be the technical cover under which major substantive changes are hidden. For example, this year’s budget calls for consolidating various block grants into the new “Strengthening America’s Communities Grant Program,” while subtle clues in the text — referring to “focuse[d] resources” and a “targeted, results-oriented approach” — could be the harbinger of changes in the direction, purpose, and function of the original grant programs.

From FY 2006 Budget, “Promoting Economic Opportunity and Ownership” "Excessive regulations can prevent the creation and growth of new small businesses and the jobs they create; in the first term, the administration slowed the growth of new rules by 75 percent. The president wants to streamline regulations further and reduce paperwork to alleviate the burdens that unduly handicap America’s entrepreneurs and job creators. The administration is taking action in several areas to streamline Federal regulations, while still moving forward with crucial safeguards for homeland security, human health, investor and environmental protection. Regulations should be analyzed based not just on their benefits, but also on their costs. When regulations are proposed, the scientific research supporting their enactment must be sound, and subject to careful scrutiny. And when regulations are out of date, they must be reviewed for relevancy, and to make sure the benefits they produce are at least equal to their costs." Another paragraph in the budget hints that the administration may be conceding to industry requests for increased reviews of regulations and sunsetting older regulations. As OMB Watch reported earlier, the White House has been conducting secret back-room meetings with corporate special interests to solicit their suggestions for government-wide reforms to regulatory policy that would weaken public safeguards in order to increase industry profits. A suggestion repeated in both those meetings and the regulatory “reform” panel of the White House economic summit called for sunsets at the level of individual regulations (rather than programs) and increased use of Regulatory Flexibility Act “section 610 reviews” of regulations’ costs to small businesses. The few scant news reports of those meetings tended to refer to sunsets and 610 reviews in the same breath, as though the increased reviews should be the occasion for forcing individual regulations to go through a sunset/justification process. Although the relevant text in the budget does not make that kind of explicit link, it does refer to “out of date” regulations being reviewed to determine if they produce net benefits. PART of the Problem: The Assault on Grant Programs A notable trend in the PART assessments is a bias against programs that operate through grants, whether competitive grants or block grants.

• Competitive grant programs generally received low PART scores: 36% were rated ineffective or adequate, while only 24% were rated effective or moderately effective, and the remainder were given the inconclusive score “results not demonstrated.”
• Competitive grant programs were also generally targeted for budget cuts: 56% were slated for decreased funding, while 34% were budgeted at the same level and only 19% were offered for budget increases.
• Block/formula grants were also scored low: 36% were rated ineffective or adequate, and an additional 37% were scored inconclusively as “results not demonstrated.”
• Block/formula grants were likewise targeted for budget cuts: 43% for budget cuts, and 30% for static funding.
• Of the programs rated “ineffective” that were zeroed out completely, 89% were competitive or block/formula grants.

Grant programs largely send money to the state and local governments, many of which have countered the administration’s attack on public safeguards with progressive regulatory policy initiatives. There are two recurring themes in these proposals: performance and sunsets. Each is a Trojan horse: hidden in what seems a simple, uncontroversial virtue is an attack on public protections. The performance theme, using the key words “results” and “performance,” seems harmless enough: the idea is that government programs should be assessed for their results and modified when performance is below expectations. The vision of performance management is that of the corporate executive moving around departments, consolidating programs, and cutting under-performing projects, according to the executive’s own whims or supposed savvy. Recent exposés of insider trading, falsified accounting and excessive CEO compensation unrelated to performance reveal that the corporate executive may not be the best model for government leadership. Moreover, it is incompatible with democracy, which is responsive to the will of the people rather than the fluctuations of the market, and the public interest, which is a guiding principle of equity and justice rather than heartless economic efficiency. In fact, this administration’s use of the “performance” theme has not comported with the promise of good government but instead has been to cover the White House’s weakening of public protections and vital services to the most vulnerable. As Professor Beryl Radin has observed, the White House’s performance rating tool (the Program Assessment Rating Tool, or “PART”) has several measures of economic efficiency but no measures of equity or justice. Actual results themselves constitute only half of the total score, the rest of which is based on internal process. In the PART results in the 2006 budget, programs rated “ineffective” apparently were targeted for elimination if they were housed in HUD or the Department of Education; of the 22 programs rated ineffective, nine (41%) had their budgets completely cut, and seven of those were either HUD programs (22%) or Education programs (56%). The only “ineffective” program to see an increased budget was the Department of Treasury’s Earned Income Tax Credit Compliance Program. The other theme, that programs or regulatory protections should have sunset dates, implies that there is something outdated or time-worn about “older” regulations and programs. These “older” protections include the ban on lead in gasoline and requirements of FDA approval for drugs before they enter the market. They continue to safeguard the public in ways that are immeasurable (and, in fact, have already been factored into the cost of doing business — so that elimination of them could cause more disruption than “relief” for business). The administration’s hostility to regulatory safeguards makes some cruel sense in one narrow sense — it is, at the very least, consistent with the rest of the budget.