Commentary Archive



International flags at the UN

Regulatory Pay as you Go: Lessons from Other Countries

July 15, 2015

By Ana Maria Zarate Moreno, Research Assistant
The adoption of the “one in, one out” rule is becoming a popular approach to control the regulatory burden borne by businesses and citizens all over the world. This commentary presents lessons from other countries in implementing this approach. It also highlights the necessity of having established systems for controlling the flow of regulation, sound institutional quality and strong oversight in order to effectively control the regulatory burden.

Governor Larry Hogan

Hogan’s Had It with Burdensome Regulations

July 13, 2015

By Sydney E. Allen, Communications & Outreach Coordinator
On July 9, Maryland Governor Larry Hogan established the state's Regulatory Reform Commission with a focus on 10 key issue areas. The 13 + member commission aims to analyze and review Maryland regulations with public input. In 2014, Maryland ranked lower than 35 states in terms of business friendly regulations - can this Commission improve the state's regulatory woes? The conversation has begun but the regulatory hurdles don't end at the Maryland state line.

Federal agency building

Senate Explores a Regulatory Budget to Increase Transparency, Oversight

July 07, 2015

By Saayee Arumugam, Summer Fellow
Spending programs in the fiscal budget come with salient costs: the taxes (or debt) used to finance them. Regulations can accomplish similar policy objectives, but with less transparent costs and muted oversight. Both on-budget programs and regulations are designed to achieve policy goals, but without budgetary constraints, the American regulatory regime continues to be additive in nature and lacks incentives for retrospective evaluation of effectiveness.

Smoke and mirrors

Escaping the "Smoke and Mirrors" in Benefit Cost Analysis

July 01, 2015

By Ana Maria Zarate Moreno
On June 18, five experts shared their views on the proper scope of BCA, how to improve this tool, and the role Congress and the Courts should play in the rulemaking process. This commentary presents the proposals and challenges identified in the “Costs and Benefits vs. Smoke and Mirrors” panel of the Federalist Society’s Third Annual Executive Branch Review Conference,

Scales of justice

Supreme Court's EPA Mercury Ruling is a Victory for Common Sense Regulation

June 30, 2015

By Susan E. Dudley, Director
On June 29, SCOTUS ruled that "EPA interpreted [the Clean Air Act] unreasonably when it deemed cost irrelevant to the decision to regulate power plants." In this commentary, Dudley examines the opinion of the Court, and explains how this ruling is a victory for common-sense regulations and American consumers.

Securities and Exchange Commission

Making Regulation More Accountable

June 19, 2015

By Susan E. Dudley, Director
On June 18, a bipartisan group of U.S. Senators introduced the Independent Agency Regulatory Analysis Act which would require independent Federal regulatory agencies (such as the FCC, SEC, & CPSC) to be held to the same analytical and oversight standards as executive agencies. In this commentary, Dudley explains how this piece of legislation is a positive step towards good governance.

Exchange of ideas

Misbehavioral Economics?

June 17, 2015

By Brian Mannix, Research Professor
The spirited Point-Counterpoint debate between Cass Sunstein & Hunt Allcott and Mannix & Dudley argued the question of using “internalities” (aka “private benefits”) to justify government regulation of energy efficiency in appliances. In this commentary, Mannix argues that the model espoused by Sunstein and Allcott only works because it assumes there are no rational consumers, giving the government a monopoly on rationality.

Chart

Regulatory Action Holding Steady in Spring 2015 Unified Agenda

May 22, 2015

By Sofie E. Miller, Senior Policy Analyst
On the Thursday before the Memorial Day holiday weekend, the Office of Information and Regulatory Affairs released its semiannual Unified Agenda of Regulatory and Deregulatory Actions, which provides the public with a first glimpse at upcoming regulations. The Spring 2015 Agenda lists 1,054 final rules and 1,171 proposed rules on which agencies will take action within the coming year. Of these active regulatory actions, 140 are "economically significant."

Reg Budget figure 1: budgetary costs of regulation over time

Regulators' Budget Increases Consistent with Growth in Fiscal Budget

May 19, 2015

By Susan E. Dudley & Melinda Warren
Every year, Susan Dudley and Melinda Warren examine the on-budget costs of regulation by examining the portion of the Budget of the United States devoted to developing and enforcing federal regulations. In this year's report, Dudley and Warren find that the regulators’ budget is growing at approximately the same pace as the overall Budget, 5.3 percent in real (inflation-adjusted) terms in FY 2016 and 4.3 percent in FY 2015. The President’s proposed budget for the regulatory activities tracked here is $66.8 billion in FY 2016. Some of the largest increases reflect Presidential priorities, such as financial market reform and immigration reform.

Hiring

Why the Federal Government Struggles to Hire and Fire

April 29, 2015

By Lindsay M. Scherber, Research Assistant
In a series of investigative articles published earlier this year, Government Executive correspondents Kellie Lunney and Eric Katz explore the often discussed, but little understood, topic of federal human resources policy. Focusing on the federal government’s perplexing hiring and firing procedures, the authors shed light on the opaque web of barriers confronting government managers as they seek to recruit qualified candidates for job vacancies and fire underperforming employees who engage in misconduct or fail to meet their job requirements.

internet

Vague Net Neutrality Rule Impedes Innovation

April 21, 2015

By Gerald Brock, Co-director
The Federal Communication Commission's (FCC's) recent order imposing common carrier and net neutrality obligations on broadband Internet access providers creates a complex new regulatory structure. The rule creates a vague property right in the existing arrangements and creates an incentive to continue with the existing arrangements rather than to experiment with new ideas. Trying something new creates regulatory risk in addition to the normal market risk associated with innovation. In this way, net neutrality could reduce the incentive to innovate in favor of continuing approved practices from the past.

Ozone

Does Reducing Ozone Really Improve Human Health?

April 08, 2015

By Louis Anthony (Tony) Cox, Jr.
In revisiting the National Ambient Air Quality Standards (NAAQS) for ozone, EPA recently concluded that current standards do not fully suffice to protect public health with an adequate margin of safety and that further reductions would probably further reduce mortalities and morbidities in the population. Central to this conclusion is EPA's determination that "O3 exposures are causally related to respiratory effects, and likely causally related to cardiovascular effects, and that long term O3 exposures are likely causally related to respiratory effects." Remarkably, this key conclusion is not supported by any reliable, objective statistical tests for potential causality. It rests solely on the subjective judgments of selected experts, applied to associational data that show that both ozone levels and adverse health effects are higher in some times and places than in others.

Disclosure

CFPB Should Consider a More Dynamic Approach to Prepaid Debit Card Regulation

April 01, 2015

By Blake Taylor, Policy Analyst
Last December, the Consumer Financial Protection Bureau proposed rules intending to improve consumers’ understanding of their choices in the prepaid debit card market and to protect them from unreasonable fees. There is little to no evidence that the proposal will have desirable consequences related to either consumer or seller behavior. What is likely is that the rule will increased compliance burdens for sellers and limit consumer choice.

Power plant

Justices debate benefits and costs of EPA mercury power plant rule

March 31, 2015

By Susan E. Dudley, Director
The Supreme Court last week heard oral arguments in Michigan v EPA regarding “whether the Environmental Protection Agency unreasonably refused to consider costs in determining whether it is appropriate to regulate hazardous air pollutants emitted by electric utilities.” The regulation being considered is a key part of the Obama administration’s environmental agenda and would require coal-fired power plant operators to install equipment to reduce mercury and other air pollutants. Section 112 of the Clean Air Act directs the EPA to issue regulations that are “appropriate and necessary” to control hazardous air pollutants, including mercury. Thus, one area of debate is whether a standard that imposes very large costs relative to benefits is “appropriate” under the meaning of the statute.

Illustration of America wrapped up in red tape

Improving Regulatory Accountability: Lessons from the Past, Prospects for the Future

February 17, 2015

By Susan E. Dudley, Director
There are now more than 70 federal agencies, employing almost 300,000 people, that write and implement regulations. Every year, they issue tens of thousands of new regulations, which now occupy over 175,000 pages of code. Concerns over the accountability of what some have called the "fourth branch" of government have led all three branches of government to take steps to exercise checks and balances. Like the bipartisan regulatory reform efforts of the 1970s and 1980s, reforms today could spur economic growth and improve the welfare of American families, workers and entrepreneurs.