What's New from the GW Regulatory Studies Center
7/25/16 - Structure vs. Process: Examining the Interaction between Bureaucratic Organization and Analytical Requirements, by Stuart Shapiro
7/20/16 - Regulation Digest, Vol. 5 No. 28
7/20/16 - Forbes: What Trump And Clinton Won't Be Talking About At The National Conventions, by Susan E. Dudley
7/19/16 - Bloomberg BNA: Groups Agree on Existence, Not Quality, of Midnight Rules, citing the GW Regulatory Studies Center
7/19/16 - Regulators' Budget Report: OIRA Shrinks as Responsibilities Grow, by Lili Carneglia
7/13/16 - Regulation Digest, Vol. 5 No. 27
7/12/16 - REPORT: The Final Countdown: Projecting Midnight Regulations, by Sofie E. Miller & Daniel R. Pérez
7/12/16 - Public Comment on EPA’s Proposed Renewable Fuel Standards for 2017 and Biomass-Based Diesel Volume for 2018, by Sofie E. Miller
7/11/16 - Public Comment on DOE’s Regulatory Burden Request for Information “Reducing Regulatory Burden”, by Sofie E. Miller
7/6/16 - Regulation Digest, Vol. 5 No. 26
New Commentaries from the George Washington University Regulatory Studies Center
Regulators' Budget Report: OIRA Shrinks as Responsibilities Grow
Beyond the Speed Bump: The New IEX Stock Exchange, and What Happens Next?
Evolution and Innovation
BIAS at the FCC
A Causal Analytics Toolkit (CAT) for Assessing Potential Causal Relations in Data
Protectionist Rhetoric Continues as U.S. and EU Wrap-Up 13th Round of Trade Talks
President Obama’s Competition Executive Order Could Benefit from a History Lesson
The Evidence-Based Policymaking Commission Act: An Opportunity for Improved Regulatory Assessment?
OSHA's Shortsighted Solution to Crystalline Silica Exposure
7/19/16 - With the recent release of the George Washington University Regulatory Studies Center’s 2017 Regulator’s Budget, there are increasing concerns surrounding the rate of growth for OIRA staff and budget relative those of other regulatory agencies. OIRA has been regarded as a highly important facet of the regulatory process. Yet, as their responsibilities grow, OIRA is less equipped to handle increased regulatory activity. OIRA’s lack of resources could have a significant impact on the quality of regulatory oversight if the federal budget continues to leave them behind.
6/22/16 - After a lengthy and rancorous public comment period, the SEC on Friday did the right thing in approving the application of IEX to become a full-fledged stock exchange. The use of brief delays, such as IEX’s deterministic delay, promises to improve the economic efficiency of financial trading. The Commission also did the right thing in committing to study developments over the next two years. While the internal logic of the IEX exchange is straightforward, the interactions among 13 stock exchanges, each with a different microstructure and timing, will inevitably be complex.
6/14/16 - Government regulations would benefit from a greater appreciation of the ecosystem-like nature of economies and a greater respect for the evolutionary pressures stimulated by competition, choice and decentralized decision-making. We live in a diverse society made up of individuals with varied circumstances and preferences. Regulatory approaches at the national level that reduce competition, choice and feedback disrupt evolutionary processes, protect favored interests from challenge and make the economic ecosystem as a whole less able to adapt and innovate.
6/6/16 - Regulatory requirements should not create artificial distinctions between competing firms, technologies, or business models. Doing so inevitably distorts competition, inhibits innovation, and harms consumers. Unfortunately, that is precisely what the Federal Communications Commission’s proposed rules governing privacy practices of broadband Internet access service (“BIAS”) providers would do. This commentary examines the impacts of the proposed rules on consumers and the economy and explains how privacy protection should put consumers first.
5/10/16 - To best inform real-world policy decisions, it is necessary for policy analysts, risk analysts, scientists, and economists to attempt to answer the crucial question: How would changing what we choose to do change the consequences that we care about? In a world of realistically incomplete knowledge and imperfect information, the answer is seldom certain. Risk analyst Tony Cox seeks to answer that question with the new Causal Analytics Toolkit (CAT); a powerful, easy-to-use software that make state-of-the-art causal analytics available to anyone who has Microsoft Excel.
5/4/16 - The success of populist presidential candidates like Donald Trump is fueled, in part, by a surge in opposition to free trade on both ends of the American political spectrum. Meanwhile, the U.S. and EU continue their negotiation of TTIP aimed at increasing economic growth. A recently published report by the GW Regulatory Studies Center, as part of a two-year grant from the EU to conduct policy research and engage public debate, examines regulatory challenges and opportunities to transatlantic trade.
4/19/16 - President Obama’s new executive order, aimed at promoting competitive markets, is a welcome announcement. Competition among firms is often the best regulator of undesirable behavior. However, the order and accompanying issue brief fail to recognize that regulation itself, rather than offering a cure for “natural monopoly,” can contribute to some unnatural monopolies. The deregulation of the 1970s and 1980s and competitive markets have generated real gains for consumers and for society as a whole, while markets have evolved in beneficial, previously unanticipated, ways.
4/6/16 - The Evidence-Based Policymaking Commission Act of 2016, a model of bipartisan cooperation, was signed into law on March 30. It establishes a 15-member commission to examine the feasibility of creating a federal data clearinghouse “to facilitate program evaluation, continuous improvement, policy-relevant research, and cost-benefit analyses by qualified researchers and institutions.” The commission’s report is July-August 2017. This commentary explains that while the law’s emphasis is on program assessment, its scope can be expanded to include regulatory assessments.
3/30/16 - OSHA issued its long awaited regulation restricting workplace exposure to respirable crystalline silica (RCS) on Friday. Unfortunately, the final rule is unlikely to have the beneficial effects the agency predicts because it doesn’t tackle the core problem. The rule mandates various technologies and practices, but the greatest challenge to reducing risks is not that employers or employees are not motivated to take protective measures, but rather a lack of information, particularly information on the relative toxicity of different forms of silica.
Latest Research from the GW Regulatory Studies Center
Structure vs. Process: Examining the Interaction between Bureaucratic Organization and Analytical Requirements
By Stuart Shapiro
Attempts by politicians to control bureaucratic decisions include both structural organization and procedural rules. But how do these interact? This article examines the relationship between bureaucratic structure and the requirement that agencies conduct an analysis of their decisions prior to their issuance in the context of two types of analysis: cost-benefit analysis and environmental impact assessment. The research finds that conduct of analysis is affected by where analysts are placed in agencies. In particular independence of analysts has a tradeoff. Despite this, analysts expressed a clear preference for independence.
By Sofie E. Miller and Daniel R. Pérez
The final months of presidential administrations are accompanied by a significant increase in regulatory output as the executive branch relies increasingly on unilateral activity in a rush to implement its remaining policy priorities. This has come to be known as the “midnight period.” This report contains two robust, quantitative models that contribute to the scholarship in this area by: predicting the number of economically significant rules likely to be issued during the Obama administration’s final months, and finding that independent regulatory agencies do not increase their regulatory output during presidential transitions.
Public Comment on EPA’s Proposed Renewable Fuel Standards for 2017 and Biomass-Based Diesel Volume for 2018
By Sofie E. Miller
EPA’s latest Renewable Fuel Standard proposal would increase the mandated total renewable fuel production to 18.8 billion gallons in 2017. Although it was intended to improve the environment, availability of new scientific, technical, and economic information shows that the RFS program is likely causing significant environmental harm through increased greenhouse gas emissions and damage to waterbodies and ecosystems. Given the environmental damage and the large economic impact of the standards, EPA should update its benefits analysis and consider using its waiver authority to further reduce the standards.
By Sofie E. Miller
To improve its ongoing retrospective review efforts, this public comment recommends that the Department of Energy incorporate plans for retrospective review into its economically significant or major rules, and provide enough time between energy efficiency standards to allow for an effective review of each rule before increasing the stringency of its standards. DOE should also consider surveys or other measures of actual consumer behavior to ensure that its assumptions about household appliance energy use are accurate. Finally, DOE should commit to measuring whether its standards negatively affect competition in regulated industries.
Improving the Accountability of Federal Regulatory Agencies, Part II: Assessing Eight Government-wide Accountability Reforms
By Marcus Peacock
Greater accountability at regulatory agencies is desirable because (1) the public has a right to know how government affects society and (2) greater accountability improves agency performance. As described in the last Insight in this series, the U.S. attempted eight major government-wide initiatives to increase accountability at federal agencies, including regulatory agencies. This Insight reviews public and expert opinion, which indicate these initiatives failed to improve accountability. New proposals to improve accountability at regulatory agencies could benefit from understanding why previous efforts fell short.
Improving the Accountability of Federal Regulatory Agencies, Part I: A Review of Government-Wide Efforts
By Marcus Peacock
Given the broad interest in improving regulatory accountability, especially by learning from the actual results achieved by previous regulations, it is ironic that little has been done to learn from the results of past regulatory reform efforts. Before mandating further requirements, Congress and the President should examine past government-wide accountability initiatives to assess their outcomes. This first Regulatory Policy Insight in a series of three on improving regulatory accountability identifies eight major past initiatives. Future Insights will examine the relative success of these eight reforms and what lessons they offer.
By Richard J. Pierce, Jr.
For 35 years OIRA has used benefit-cost-analysis to review major rules issued by executive branch agencies. Generally, OIRA reviews major proposed agency rules to determine whether their expected benefits to society exceed their expected costs to society. If the estimated costs of a proposed rule exceed its estimated benefits, OIRA urges the agency to change the rule in ways that will increase its benefits and reduce its costs. For almost as long as OIRA has been applying BCA, some of the smartest and most productive progressive scholars have criticized the role of OIRA generally and OIRA’s use of BCA in particular. It is time for those scholars to stop wasting their energy tilting at windmills and put their extraordinary talents to use in more promising endeavors.
By Susan E. Dudley
Despite efforts to ensure that new regulations provide net benefits to citizens, the accumulation of regulations threatens economic growth and well-being. As a result, Congress is exploring the possibility that applying fiscal budgeting concepts to regulation could bring more accountability and transparency to the regulatory process. This Essay in the NYU Journal of Legislation and Public Policy examines the advantages and challenges of applying regulatory budgeting practices and draws some preliminary conclusions based on successful experiences in other countries.
By Sofie E. Miller
In testimony before the House Energy and Commerce Subcommittee on Energy and Power, Senior Policy Analyst Sofie E. Miller explains that one-size-fits-all energy efficiency standards can deprive consumers of the ability purchase the appliances that best suit their unique circumstances and constraints. As a result, these regulations cost consumers rather than benefiting them, as the Department of Energy posits. In addition, these standards disparately impact low- and median-income households, and current analyses of their effects suggest that these populations bear significant costs as a result.
Public Comment on Protecting the Privacy of Customers of Broadband and Other Telecommunications Services
By J. Howard Beales III
The FCC has proposed detailed rules governing privacy practices of broadband Internet access service (“BIAS”) providers. The rule would establish new, and different, privacy standards, beyond those that apply to other Internet companies. This comment argues that the FCC’s rationales for treating BIAS providers differently are flawed and the proposed separate regulatory regime for broadband providers would inhibit innovation, reduce competition, and harm consumers. If it feels it must regulate, the FCC should adopt a functionality based approach to privacy regulation to maximize consumer welfare.
The Federal Government on Autopilot: Delegation of Regulatory Authority to an Unaccountable Bureaucracy
By Sofie E. Miller
In testimony before the House Task Force on Executive Overreach, Senior Policy Analyst Sofie E. Miller explains that retrospective review is a key component of an effective regulatory process because it allows agencies to review whether existing rules are accomplishing their intended goals and to determine what effect they have on the regulated public. Miller argues that writing rules at the outset to facilitate this measurement can improve outcomes and enable policymakers to learn from what has worked and what hasn’t.
By Susan E. Dudley & Melinda Warren
According to a new analysis from the GW Regulatory Studies Center and the Weidenbaum Center at Washington University in St. Louis, fiscal outlays for administering regulation have increased more than 20-fold since 1960. In the final year of the Eisenhower administration, regulatory agencies employed a little more than 57,000 people and spent $533 million (equivalent to $3 billion in 2009 dollars). President Obama’s final budget request to Congress proposes expenditures of $70.0 billion ($61 billion in 2009 dollars) on regulatory activities in FY 2017, and a staff of almost 279,000.
Public Comment on FDA’s Public Availability of: Draft Environmental Assessment and Preliminary Finding of No Significant Impact Concerning Investigational Use of Oxitec OX513A Mosquitoes
By Daniel R. Pérez
Genetically-modified mosquitoes hold great promise for addressing mosquito-borne diseases that threaten South Florida. Yet, the Florida Keys Mosquito Control District has been waiting since 2011 for approval from FDA to allow the biotechnology company Oxitec to conduct field trials for this promising technology. This public interest comment points out that the trial poses no appreciable risk to human or animal health or the environment. The unusually lengthy timeframe for approval has unnecessarily limited our ability to combat the spread of life-threatening diseases, like Zika and Dengue.
By Sofie E. Miller, Daniel R. Pérez, Susan E. Dudley & Brian Mannix
The federal government has a long track record of issuing regulations that create barriers to competition. President Obama recently signed Executive Order 13725 instructing federal agencies to identify and address barriers to competition, which provides agencies with a valuable opportunity to reevaluate the effects of existing rules. This Insight suggests several areas of regulatory policy where federal regulations have hindered, rather than helped, competition, and recommends that agencies take this opportunity to reduce these regulatory barriers to competition.
By Chris Carrigan & Stuart Shapiro
Observers across the ideological spectrum have criticized benefit–cost analysis for as long as it has been part of the rulemaking process. Still, proponents and detractors agree that analysis has morphed into a mechanism often used by agencies to justify regulatory decisions already made. We argue that a simpler analysis of more alternatives conducted earlier in the regulatory process can resuscitate it as a tool to inform policy. Recognizing that requiring a procedure does not ensure that regulators will follow it, we offer possible remedies, including strengthening or relaxing subsequent review of proposed rules, which raise the cost of circumventing the reform or lower the cost of following it.