What's New from the GW Regulatory Studies Center
6/17/19 - Here’s how federal agencies can write more effective regulations — and win regulatory battles in court, Washington Post, by Jerry Ellig & Catherine Konieczny
6/17/19 - IRS Rule on Charitable Deductions: A Worthy Goal, a Skillful Fix, but Surprisingly Thin Evidence, by Jerry Ellig
6/12/19 - Research Brief: Why Should We Focus on the Form of Regulation?, by Zhoudan Xie
6/12/19 - The Relationship Between Regulatory Form & Productivity: An Empirical Application to Agriculture, by Julie Balla, Daniel Pérez, Aryamala Prasad, & Zhoudan Xie
6/4/19 - Organizational Process, Rulemaking Pace, and the Shadow of Judicial Review, by Christopher Carrigan & Russell Mills
6/3/19 - Restoring Internet Freedom as an example of How to Regulate, by Jerry Ellig
5/28/19 - Expanding OIRA Review to IRS, by Bridget Dooling
5/22/19 - 2019 Spring Unified Agenda, by Daniel Pérez
5/7/19 - Testimony: From Beginning to End: An Examination of Agencies’ Early Public Engagement and Retrospective Review, by Susan Dudley
5/7/19 - Public Interest Comment: DOE's Energy Conservation Program for Appliance Standards, by Mark Febrizio
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New Commentaries from the George Washington University Regulatory Studies Center
IRS Rule on Charitable Deductions: A Worthy Goal, a Skillful Fix, but Surprisingly Thin Evidence
Research Brief: Why Should We Focus on the Form of Regulation?
2019 Spring Unified Agenda
Proposed Revisions to DOE’s Process Rule Include Beneficial Changes and Areas for Improvement
Early but Not Often: A Look into the Use of ANPRMs in Rulemaking
Statutory Clarity and Judicial Review of Regulatory Impact Analysis
Revising WOTUS
Is GDPR the Right Model for the U.S.?
The Eagle and the Dragon: Comparing Government Consultation and Public Participation between the US and China
IRS Rule on Charitable Deductions: A Worthy Goal, a Skillful Fix, but Surprisingly Thin Evidence
6/17/19 - The IRS prohibits individual taxpayers from deducting charitable contributions on their federal taxes if they received a state or local tax credit in exchange for the contribution, but allows them to count such donations as state or local tax payments subject to the $10,000 cap on state and local tax deductions.
Research Brief: Why Should We Focus on the Form of Regulation?
6/12/19 - As part of a cooperative agreement with the USDA, a new GW Regulatory Studies Center report finds that growth in total regulation has a negative relationship with land productivity growth, and the relationship differs according to the form of regulation.
2019 Spring Unified Agenda
5/22/19 - The Spring 2019 Unified Agenda includes a total of 3,791 actions, 295 of which are classified as regulatory, 721 as deregulatory, with the remainder exempt or classified as “other.” Of the total number of actions, 177 are economically significant. The agencies with the most deregulatory actions planned are the Department of Transportation (DOT) with 129 actions and the Department of Health and Human Services (HHS) with 65; these same two agencies have had the most deregulatory actions planned since the Fall 2017 Agenda.
Proposed Revisions to DOE’s Process Rule Include Beneficial Changes and Areas for Improvement
On February 13, 2019, the Department of Energy (DOE) released a notice of proposed rulemaking (NPRM) that updates its internal rulemaking procedures for energy conservation standards, called the Process Rule. Policy analyst Mark Febrizio submitted a public comment on DOE’s proposed revisions to the Process Rule that focused on eight areas of interest in the revised Process Rule, highlighting both beneficial changes and additional areas for improvement.
Early but Not Often: A Look into the Use of ANPRMs in Rulemaking
5/3/18 -- Prior to the proposal of a new rule, agencies may decide to seek public comment through an advance notice of proposed rulemaking (ANPRM) on whether a new rule is necessary and what should be included if the rule progresses. Despite the importance of public participation in rulemaking, only 5% of all significant rules are preceded by an ANPRM. This commentary takes a closer look at trends in the use of ANPRMs and suggests questions for further research.
Statutory Clarity and Judicial Review of Regulatory Impact Analysis
4/29/19 -- Precise statutory language corresponds to better benefit-cost analysis and more consistent judicial review. Originally posted in The Regulatory Review.
Revising WOTUS
4/16/19 -- The proposed revision to the definition of the “waters of the United States” is a significant improvement over prior definitions, including that adopted in 2015. If the definition contained in the final rule is similar to that which has been proposed, it is likely to provide greater legal certainty for the regulated community and is likely to be less vulnerable to legal challenge than were prior definitions.
Is GDPR the Right Model for the U.S.?
4/3/19 -- Recent discussions on online privacy regulation refer to the European Union’s General Data Protection Regulation. It is often seen as a good model to follow for protecting personal data in the digital age. We apply a benefit-cost framework to understand its implications on this side of the Atlantic. Given the existing regulations, an evidence-based approach to identify net-benefits might offer a balanced approach to personal data protection.
The Eagle and the Dragon: Comparing Government Consultation and Public Participation between the US and China
This commentary demonstrates an interesting comparison in government consultation and public participation between the US and China. It shows that the US and China appear to have little variation in consultation procedures and participation levels, but major divergence in the level of transparency and the type of stakeholders who participate.
Research
Public Interest Comment: FDA's Proposed Rule on Mammography Standards
Early detection of breast cancer can save live, and mammography is one of the screening tools that has contributed to reductions in breast cancer mortality. The FDA has a unique role in mammography and should be commended for proposing to update its rules, however, the proposed rule’s breast density notification raises issues of state preemption; lessons that can be learned from testing, evaluation, and assessment of prior state action; and analysis of distributional and equity effects.
The Relationship Between Regulatory Form & Productivity: An Empirical Application to Agriculture
Under a cooperative agreement with the United States Department of Agriculture, the George Washington University Regulatory Studies Center produced this four-chapter report detailing the findings of its research on the relationship between regulation and agricultural productivity. This report does not represent an official position of the GW Regulatory Studies Center, the George Washington University, or the United States Department of Agriculture.
Organizational Process, Rulemaking Pace, and the Shadow of Judicial Review
By: Christopher Carrigan & Russell W. Mills (Published by the Public Administration Review)
Scholars have long understood that structuring internal work processes into more hierarchical or team‐based arrangements has consequences for organizational outputs. Building on this insight, this research examines the relationship between how agencies organize their rulemaking routines and the resulting rules. Tracking the job functions of rule contacts for economically significant rules proposed over a four‐year period, the analysis demonstrates that expanding the breadth of personnel types closely involved in a rulemaking is associated with a reduction in the time it takes to promulgate the rule. However, increasing the pace at which rules are finalized is not without cost, as those completed faster appear more likely to be overturned when challenged in court. The article not only adds another dimension to empirical scholarship studying rulemaking, which has largely focused on how forces originating outside the agency affect rules, but also suggests the importance of considering competing priorities in designing rulemaking processes.
Restoring Internet Freedom as an example of How to Regulate
By: Jerry Ellig
Thomas Lambert’s How to Regulate contains some simple but critical pieces of advice for regulators: (1) Diagnose the problem before settling on a solution, (2) Compare the merits (benefits and costs) of alternatives, and (3) Recognize that regulators, like the rest of us, respond to the incentives created by the organization in which they are embedded. The FCC’s Restoring Internet Freedom order presents an example of how to apply those principles in practice. The 2017 order’s decisions on blocking and throttling, paid prioritization, and the general conduct rule are informed by an extensive diagnosis of the problems the regulations are intended to solve and an assessment of the merits of alternative solutions. The decision to reclassify broadband from Title II to Title I takes into account the public choice incentives that could lead regulators to behave in a less-than-optimal way.
Expanding OIRA Review to IRS
By Bridget C. E. Dooling
Executive Order 12866 describes U.S. policy on regulatory planning and review. It directs agencies to identify the nature and significance of the problem they are trying to solve with regulation, to identify alternative solutions, to assess the quantifiable and non-quantifiable costs and benefits of each alternative, and then to choose the option that maximizes net benefits to society, taking into account distributional effects and other considerations. That policy, which has governed U.S. regulation for several decades, is managed by the Office of Information and Regulatory Affairs (OIRA). It is also subject to several exemptions. In April 2018, the U.S. Department of Treasury and the Office of Management and Budget signed a historic memorandum of agreement (MOA) narrowing one of those exemptions. The MOA expands the number of Internal Revenue Service (IRS) regulatory actions for which IRS must comply with EO 12866. This action moved tax rules out of the “presidential tax-policy blind spot” as described by Professor Clint Wallace. This working paper offers a close study of the MOA and reveals six striking features that not only affect tax regulation, but also offer intriguing possibilities for (1) scholarly understanding of OIRA as an institution and (2) the future of regulatory review of independent agencies, which is the largest remaining exemption from OIRA review.
Testimony: From Beginning to End: An Examination of Agencies’ Early Public Engagement and Retrospective Review
Susan Dudley testified before the U.S. Homeland Security and Governmental Affairs Regulatory Affairs and Financial Management Subcommittee on May 7, 2019, commending the Subcommittee’s bipartisan regulatory reform legislation. By 1) engaging public input earlier in the regulatory development process and 2) providing for retrospective review of regulations to evaluate whether they are achieving their objectives, the two bills can help ensure that regulations are based on the best evidence available and that they are working as intended for the American people.
Public Interest Comment: DOE's Energy Conservation Program for Appliance Standards
The Department of Energy is proposing to update and modernize its current rulemaking methodology for establishing new or revised energy conservation standards and test procedures, called the “Process Rule.” While the agency has adhered to internal procedures for years, the notice of proposed rulemaking seeks to make those procedures binding on the agency. The proposed rule includes many important provisions and is largely a step in the right direction. This public comment focuses on eight areas of interest in the revised Process Rule, highlighting both beneficial changes and additional areas for improvement.
Review: How Do Cross-Country Regulatory Systems Affect Poverty?
By Mark Febrizio
A March 2019 Policy Research Working Paper for the World Bank Group examines how “business-friendly” regulations and their enforcement affect poverty at the country level. This review analyzes the paper’s main claims, examines its methodology, and recommends ways to make improvements. In its current form, the paper makes strong claims that are not fully supported by the results or methodology. Modifying the analysis could enhance the findings and expand the paper’s contribution to the literature on country-level determinants of poverty. Rather than offering a clear path forward to addressing poverty, the paper is better seen as a starting point for further research.
Public Interest Comment: Revising WOTUS
By: Jonathan H. Adler
In this public interest comment, Jonathan Adler finds that the EPA and the Army Corps of Engineers proposed revision of the definition of “waters of the United States” is a substantial improvement over prior definitions, not least because it acknowledges the statutory and constitutional limits on federal regulatory jurisdiction under the CWA and takes seriously the need for greater clarity and certainty about the scope of federal regulatory jurisdiction.
Working Paper Series: Adapting Policy Analysis for Uncertain Futures
Policymakers face demands to act today to protect against a wide range of future risks, and to do so without impeding economic growth. Yet traditional analytical tools may not be adequate to frame the relevant uncertainties and tradeoffs. Challenges such as climate change, nuclear war, and widespread natural disasters don’t lend themselves to decision rules designed for discrete policy questions and marginal analyses. We refer to such issues as “uncertain futures.”
Public Interest Comment: IRS Qualified Business Income Deduction
By Jerry Ellig & Jeffery Kaufman
The 2017 tax reform allowed investors in real estate investment trusts (REITS) and publicly-traded partnerships (PTPs) to take a tax deduction equal to 20 percent of qualifying distributions from REITs and PTPs. The Internal Revenue Service seeks comment on whether investors should also be allowed to take this deduction if they own REITs or PTPs through a regulated investment company, such as a mutual fund. Unfortunately, the IRS did not conduct an economic analysis sufficient to determine which choice is economically efficient. A complete analysis would first assess whether the deduction is economically efficient; building on that analysis, the IRS could then determine whether extending the deduction is efficient. We provide some illustrative calculations that point the way toward a more complete analysis.
Planning for Everything (Besides Death and Taxes)
By Susan Dudley, Daniel R. Pérez, Brian Mannix, & Christopher Carrigan
As part of a GW Regulatory Studies Center series of working papers on “Adapting Policy Analysis for Uncertain Futures,” this paper notes that policymakers face demands to act today to protect against a wide range of future risks, and to do so without impeding economic growth. Yet traditional analytical tools may not be adequate to frame the relevant uncertainties and tradeoffs. Challenges such as climate change, nuclear war, and widespread natural disasters don’t lend themselves to decision rules designed for discrete policy questions and marginal analyses. We refer to such issues as “uncertain futures.”
From Football to Oil Rigs: Risk Assessment for Combined Cyber and Physical Attacks
By: Fred S. Roberts
As part of a GW Regulatory Studies Center series of working papers on “Adapting Policy Analysis for Uncertain Futures,” Fred Roberts applies risk assessment to scenarios of terrorist attacks on critical infrastructure including U.S. sporting venues and the international maritime transportation system. He notes that risk assessments of terrorist attacks traditionally treat physical and cyber attacks separately and are inappropriate for considering the risk of combined attacks that include both a physical and cyber component. He proposes a framework informed by expert judgement to determine whether an attacker would likely prefer executing a combined or traditional physical attack on a given target.
Nuclear War as a Global Catastrophic Risk
By: James Scouras
As part of a GW Regulatory Studies Center series of working papers on “Adapting Policy Analysis for Uncertain Futures,” James Scouras identifies nuclear war as a global catastrophic risk and suggests that multidisciplinary studies that combine insights from “historical case studies, expert elicitation, probabilistic risk assessment, complex systems theory, and other disciplines” can address many of the shortcomings of single analytic approaches. He suggests that experts can address current gaps in their assessments of the consequences of nuclear weapons by further investigating understudied phenomena (e.g., the effects of electromagnetic pulses, nuclear winter, the prolonged effects of radiation).
A Brief History of Regulation and Deregulation
By: Susan Dudley
The history of regulatory policy in the United States is rich, but its future remains unclear. Susan Dudley provides four key milestones in the development of the current regulatory policy landscape, and posits that we may be in the midst of a fifth milestone being laid, in this article for The Regulatory Review at the University of Pennsylvania Law School.
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