Experts in regulatory affairs discussed the impact of the field’s longstanding guidelines on agency rulemaking and their impact under the Trump administration.
By Tatyana Hopkins
The American regulatory system’s longstanding bipartisan consensus on the significance of cost-benefit analysis is in jeopardy under the Trump administration, according to Richard Revesz, director of the Institute for Policy Integrity and law professor at New York University.
“If we want to preserve cost-benefit analysis for the future, we need to be clear about the significant affronts that have taken place over the last 20 months and fight to protect cost-benefit analysis from the deregulatory forces that are running over it,” Mr. Revesz said.
Mr. Revesz spoke at an event hosted by the George Washington University Regulatory Studies Center, which brought the Office of Information and Regulatory Affairs (OIRA) administrators under the previous four presidents, bipartisan congressional staff, senior agency officials and other leaders in the field together to celebrate the 25th anniversary of Executive Order 12866.
Attorney John Cooney moderated the panel of regulatory experts that included Mr. Revesz; Susan Dudley, director of the GW Regulatory Studies Center; Neomi Rao, current OIRA administrator; and Ann Marie Buerkle, chair and commissioner of the Consumer Product Safety Commission.
Signed by President Bill Clinton, Executive Order 12866 directs agencies to only issue regulations required by law or to meet a “compelling public need” and requires them to assess all costs and benefits of regulatory alternatives including not regulating at all. It also requires OIRA, which is within the Office of Management and Budget, to review and coordinate significant regulatory actions.
Mr. Revesz said rather than maximizing on the net benefit of regulation, the Trump administration instead holds the overall goal of regulation to be minimizing cost.
“The Trump administration has justified a number of its efforts to delay, stay or suspend Obama administration regulations by reference only to the cost savings to regulate industries without looking at the foregone benefits to regulatory beneficiaries,” he said. “If you mangle the analysis enough, at the end of the day, it will look like all the actions are net beneficial, but they're not.”
Pointing specifically to a new Department of Homeland Security rule proposal that would deny immigrants green cards if they received certain government benefits or if the government anticipates they may do so in the future, Mr. Revesz said the administration has ignored nearly 100 pages of analysis showing the negative impacts of the rule.
“There is virtually no discussion of the negative health consequences and other consequences to people who qualify for these benefits who might decide to forego them in order to protect their immigration status,” Mr. Revesz said.
The panelist said the last presidential election ushered in a dramatic shift in American regulation policy.
The Obama administration issued more major regulations than any prior administration, while the Trump administration is on ae path to issue fewer regulations than the Reagan administration.
Ms. Rao defended the deregulatory actions of the current administration, though she said her current position in the Trump administration prevented her from speaking about specific regulations before the office.
“In the previous administration there was a tremendous amount of regulatory activity, and the imposition of an enormous amount of regulatory costs,” she said. “This administration has been committed to turning that around.”
She said the administration is not overturning “regulations that are working,” and she believes deregulation “on regulations that aren’t working” will have positive impacts on the economy and job creation.
“All the deregulation actions we are doing are net beneficial,” Ms. Rao said. “That means we are not deregulating unless the benefits of deregulation outweigh the costs.”
Ms. Dudley, a former OIRA administrator, said regulators should exercise “regulatory humility” and defer to the principles of Executive Order 12866.
"Executive Order 12866 seems to be here to stay,” she said. “It's a framework that has been widely accepted.”
She said the order has served as a framework for all three branches of the federal government in dealing in matters of regulation.
“I think there is concern that for a while there has been more of an emphasis on other benefits, co-benefits added to the benefits side without corresponding co-costs,” she said. “It should be balanced.”
Ms. Buerkle agreed that regulatory humility and balanced analysis are key.
“You're going to see a bit of shift with a different administration,” she said. “That's just the reality.”
She said to guide responsible regulation, regulators should ask themselves “what is the market failure, and does government have a better answer or by doing this are we going to stifle innovation?”