A series of catastrophic regulatory failures have focused attention on the weakened condition of regulatory agencies assigned to protect public health, worker and consumer safety, and the environment. The destructive convergence of funding shortfalls, political attacks, and outmoded legal authority have set the stage for ineffective enforcement, unsupervised industry self-regulation, and a slew of devastating and preventable catastrophes. From the Deepwater Horizon spill in the Gulf of Mexico to the worst mining disaster in 40 years at the Upper Big Branch mine in West Virginia, the signs of regulatory dysfunction abound. Many stakeholders expected that President Obama would move to reinvigorate the regulatory system, but he has not. In fact, he's gone so far as to adopt some anti-regulatory rhetoric, and suggesting that that alleged over-regulation contributes to the nation's economic woes.
One central reason for the systemic failure of effective health and safety regulation is that many regulatory matters enter and exit the White House through the Office of Management and Budget’s (OMB) little-known but extraordinarily powerful Office of Information and Regulatory Affairs (OIRA). Centralized White House regulatory review began during the Nixon administration and OIRA was created in 1980. Over four decades, the process has evolved into a gauntlet for public health, worker safety, and environmental protection initiatives,. Agencies doing their best to implement statutory mandates in a reasonable timeframe are subjected to withering rule-by-rule reviews. The process is analogous to examining the branches of individual trees without realizing that they are part of a dying forest; this myopia has obscured the causes and effects of regulatory failure for five presidents from both parties.
Full text
Late last month, the Department of Energy proposed long overdue energy efficiency standards for commercial refrigeration units. The rules, which had been held up at OMB’s Office of Information and Regulatory Affairs (OIRA) for almost two years will result in savings of over $28 billion for businesses over the next 30 years and reductions in carbon emissions of 350 million tons over the same period. As we’ve discussed numerous times, rules are required by executive order to be reviewed by OIRA for no longer than 120 days. And OIRA routinely hangs onto them for months and frequently years. Recently, a rule to green federal office building just hit the two-year mark at OIRA.
So what’s happened in the past two years to slow down the progress of these two rules along with the other energy efficiency standards stuck at OIRA? After all, back in 2009, former Energy Secretary Steven Chu described energy efficiency standards as not just low hanging fruit, but “fruit lying on the ground.”
Savings for industry and consumers as well as reducing the burden of greenhouse gases on the environment seems like a no-brainer to anyone with common sense. But then, there are always House Republicans. Just this past summer, Rep. Marsha Blackburn (R-TN) waged a war against ceiling fans. That’s right, she tacked on an amendment to the Energy and Water spending bill to stop a DOE rulemaking process to review ceiling fan standards mandated by Congress itself. Feverish and kneejerk anti-regulatory efforts like these have unfortunately taken off in recent years in spite of past bipartisan support for energy efficiency and in many cases, industry enthusiasm for moving forward.
Full textWe’ve often written in this space about the Obama Administration’s very bad idea to take federal inspectors of the line at poultry processing plants, leaving the discovery of blood, guts, and feathers on the carcasses to overworked and underpaid line workers forced to process as many as 70 birds per minute at the average plant. The U.S. Department of Agriculture (USDA) is the architect of this proposal to “modernize” the food safety system without requiring a single additional test to make sure the birds are not infested with salmonella, campylobacter, and other bad bugs. Confirming the rule’s primary role as a windfall for the poultry industry, USDA’s initial cost-benefit analysis indicated that it would save companies like Holly Farm, Tyson’s, and Perdue $250 million annually. That windfall is attributable to the fact that under the proposal, the line speed will at least double, to as many as 175 birds per minute.
Today, GAO released a report that further discredits this bad idea, confirming the dire warnings of food safety experts: USDA is relying on junk data from a pilot program, raising the strong possibility that any final rule won’t survive judicial review. This rule is so controversial that it will almost certainly be challenged in court. When it is, it will be reviewed under the Administrative Procedure Act’s arbitrary and capricious standard, and USDA is running the risk that a judge will find the agency’s shoddy analysis fails to meet the standards of quality demanded by the Administrative Procedure Act (APA).
Full text
Like no other mammoth corporation that did very bad things—not Enron, not WorldCom, not Exxon, and not even HSBC (which, after all, laundered money for the Mexican drug cartel and was allowed to pay a fine without pleading guilty!)—BP has not lost its arrogant swagger. In a fit of high dudgeon it filed a lawsuit last week challenging the one step the federal government has taken that could actually hurt the company over the long run: the long-overdue debarment of this chronic scofflaw from receiving contracts to supply fuel to the U.S. military.
Despite the semi-hysterical, every-argument-known-to-humans tone of its 127-page legal filing, Bob Dudley, BP’s chief executive officer, has been blithe about the effect of the debarment on its bottom line: “We have largest acreage position in Gulf of Mexico, more than 700 blocks…that’s plenty, we have a lot (sic),” he told the Telegraph, a British newspaper, a few weeks ago. “We have been debarred from supplying fuel to the U.S. military going forward but quite frankly we have a very big business in the U.S. and this is not distracting us from what we do.”
The Clean Water Act authorizes the Environmental Protection Agency (EPA) to debar companies that are not “responsible” from doing business with the government. Other provisions of federal law give the Pentagon the same authority but it could not be bothered to find a different fuel supplier even after the Deepwater Horizon explosion killed 11 and devastated the Gulf of Mexico. Showing itself once again to be one of the last feisty entities left in government, and after contemplating just such an action since 2005, EPA debarred BP in November 2012, just a few short months before the company pled guilty to manslaughter, a slew of environmental crimes, and—just for good measure--lying to Congress. It paid a $4 billion fine—the largest in history but Dudley is apparently still smiling.
The term “scofflaw” should not, of course, be used lightly. For those who need a little boning up on BP’s recidivist history, consider the following and let’s ask ourselves whether we might have avoided the entire Deepwater Horizon horror had EPA been allowed to debar the company back in 2005.
Full textThe Senate’s grudging confirmation of Tom Perez as Secretary of Labor was the first piece of good news working people have had out of the federal government for quite some time. I know Perez--as a neighbor, a law school colleague, Maryland’s labor secretary, and a civil rights prosecutor. He’s a fearless, smart, and hard-driving public servant—exactly the qualities that Sen. Mitch McConnell (R-KY) and his caucus deplore in Obama appointees. With luck, Perez will be successful in direct proportion to the unprecedented vitriol Republicans hurled in his path. Their efforts to define a “new normal” for appointees—no one need apply who has ever done or said anything the most rabid member of the Tea Party might dislike—should not distract us from the real challenges confronting Perez within the Administration.
The success or failure of Perez's tenure will be decided not by Mitch McConnell, but by a White House whose political operatives have squashed every significant regulatory initiative suggested by the Occupational Safety and Health Administration’s (OSHA) star-crossed leader, David Michaels. In fact, so relentless has this punishing counter-campaign been that there now exists the very real possibility that President Barack Obama, who probably owes at least his first-term victory to the hard work of organized labor, will finish eight years in office having promulgated only two rules to address grave threats to worker safety and health. One is the revised Hazard Communication Standard, requiring employers to change the way they notify workers about toxic chemicals in the workplace. The other changed the rules covering use of cranes and derricks in the construction industry, focusing mostly on training, certification, and inspection requirements. The “HazCom” revisions were largely driven by changes to international standards and the cranes and derricks rule was developed through a negotiated rulemaking process during the George W. Bush Administration. So, other than whatever gains the agency may have achieved through enforcement, its rulemaking agenda has almost run off the tracks, and it will take a herculean effort to get it back on.
Full textLater in this space, we plan to discuss the many and varied failings of a proposal in the Senate to reform the Toxic Substances Control Act. Unfortunately, the proposal is the joint work product of conservative Sen. David Vitter (R-LA) and liberal Sen. Frank Lautenberg (D-NJ), who died two weeks ago and therefore won’t have the chance to fix the legislation that is so unworthy of his name.
But before we take on that misguided proposal, we wanted to pay tribute to the Senator’s larger legacy. Frank Lautenberg was a tireless advocate for progressive causes, who played a key role in many of the environmental and health battles of the last three decades. He was a relentless and effective advocate for the people of the “Garden” state, which in addition to its reputation for farming on lush land, also holds the tragic distinction of hosting more Superfund toxic waste sites than almost any other state.
New Jersey, once the third largest petrochemical producing state in the union, has a very large population in a small space. All of the elected and appointed officials who have risen to prominence there are highly sensitive to these issues and have frequently offered their leadership for the good of the nation as a whole. Indeed, it’s no accident that two former administrators of the EPA—Christie Todd Whitman, a Republican (and former governor), and Lisa Jackson, a Democrat, came from the ranks of the state’s government. Both worked closely with Sen. Lautenberg, who could always be depended upon to fight for more resources and better laws to address grievous public health hazards.
Over the course of roughly 28 years in the Senate (not counting a two-year gap when he temporarily retired), Lautenberg reshaped the nation’s approach to smoking, drunk driving, domestic violence, toxic waste cleanup, and community right-to-know. Legislation he introduced in the 1980s helped trigger the smoke-free revolution by prohibiting smoking on commercial airplane flights. The law marked a significant early defeat for the tobacco lobby, making tougher legislation at the federal, state and local level, possible. Lautenberg was also instrumental in toughening the country’s drunk-driving laws, establishing a nationwide .08 blood alcohol standard and a 21-year drinking age. He wrote and got passed legislation that prohibited perpetrators of domestic violence from owning guns.
On the environmental front, Lautenberg worked tirelessly with Sen. Bill Bradley and Reps. Jim Florio, Bob Roe, and Jim Howard to win reauthorization of the multi-billion Superfund program that harnessed the federal government’s power and resources to eliminate the worst threats posed by the thousands of dumpsites filled with toxic chemicals throughout New Jersey and the country. He was instrumental in winning passage of the Emergency Planning and Community Right-to-Know Act that was designed to prevent industrial accidents like the explosion at a Union Carbide pesticide plant in Bhopal, India that ultimately claimed 3,787 lives.
Full textAs the scandal du jour over the pure lug-headedness of some IRS staffers reminds us, any screw-up, anywhere in the government, will make its way to the White House press briefing room in about a nanosecond of Internet real time. Suspicion is deeply bred into the press corps, and appropriately so. For that reason, the 2,000 or so people who directly serve on the President's White House staff, but who remain faceless to the rest of us, insist on maintaining control over anything that could embarrass him, including dozens of health, worker safety, and environmental rules that might engender so much as a whiff of controversy or attract a smidgen of opposition from powerful special interests.
In this vein, we look forward to the confirmation hearings of one of the few White House politicos actually subject to the Senate's advice and consent—Howard Shelanski, President Obama’s nominee for the powerful position of “regulatory czar,” a.k.a. Administrator of the Office of Information and Regulatory Affairs (OIRA), located within the White House Office of Management and Budget (OMB). Dr. Shelanski, a lawyer (Berkeley ’92) and Ph.D. economist (Berkeley ’93), was most recently the chief number-cruncher at the Federal Trade Commission (FTC), giving rise to speculation that he will spearhead an effort to bring independent agencies like the Securities and Exchange Commission (SEC) under Executive Order 12,866, which is read to require elaborate cost-benefit analyses before the issuance of any rule or guidance that upsets powerful industries.
Given the high dudgeon of investment bankers these days—the New York Times recently reported their determination to sabotage new derivatives (!!) rules under consideration at the Commodities Futures Trading Commission—bringing the independent agencies to heel is undoubtedly a priority for the waves of lobbyists who swarm the White House staff each morning. But we hope Shelanski will be called to account for a more appropriate agenda.
Notwithstanding the loud and endless gnashing of teeth by conservative groups, the truth is that the total number of significant, substantive rules issued in 2012 (848) was substantially lower than the number issued in the last year of the George W. Bush Administration (1,063), and 2013 looks to be shaping up as the lowest (at the current rate, a projected total of 579) since 1997. Some illuminating tables and a list of delayed rules prepared by regulatory analyst Curtis Copeland, a respected retiree from the Congressional Research Service who spoke at a recent CPR event, bear this out. In fact, counting all the little stuff, including routine approvals by the federal government of programs implemented by the states, at the rate it is going, the Obama Administration will produce this year considerably fewer than half the “rules” (1,360) that the George W. Bush Administration did in its last year in office (3,085).
Full textToday's move by Senate Republicans to boycott a committee confirmation vote on Gina McCarthy to lead the EPA is just another in a series of shameless tactics aimed at hampering the Environmental Protection Agency and preventing it from doing the people's business. The list includes endless filibusters; sequester cuts that make it harder to enforce existing laws; a host of attacks on specific environmental regulations under the Clean Air Act, Clean Water Act and other statutes addressing critical environmental issues; and wholesale assaults on the regulatory process. To that undistinguished list, we can now add "taking their marbles and going home," rather than voting on a presidential nominee to lead the EPA.
Full textSee the UPDATE at the bottom of the page.
Last Thursday, President Obama named Howard Shelanski as his new nominee for Administrator of the Office of Information and Regulatory Affairs (OIRA). As of that evening, Shelanski was listed on the website of the industry-funded, fiercely anti-regulatory Mercatus Center as an "expert" in its Technology Policy Program. OIRA has long operated as a regulatory chokepoint, stalling and weakening health and environmental safeguards at the behest of industry groups, and as I've written, the protection of the public will require the next Administrator to work hard to transform OIRA's role. Although much research remains to be done on Shelanski's record, his association with Mercatus raised serious concerns about whether he could be the person to bring that fundamental change to OIRA. (In fact, it brought back memories of George W. Bush, who culled his second OIRA Administrator, Susan Dudley, from Mercatus's ranks.)
I pointed the Mercatus connection out in a blog the morning after his nomination. By Friday afternoon, without any explanation, Shelanski's name had been quietly removed from Mercatus' list of experts. (Here's Google's cached version (in pdf form) from April 11, 2013 showing Shelanski's name; here's the same page still available on the web as of this morning; and here's the Shelanski-less version of the page as it looks today on the Mercatus website.)
So, questions arise: Did Mercatus take his name off its list of scholars at Shelanski's request, or on their own initiative? Was Mercatus somehow mistaken about who its own scholars were? The answers to those questions, if we ever get them, will give us a better idea whether Mercatus somehow over-reached when it listed him as one of their scholars, or—what's more concerning—whether there was some relationship that Shelanski, Mercatus, or both now would rather hide from view.
UPDATE: A few hours after this was posted, Benjamin Goad of The Hill put these questions to Mercatus spokesperson Leigh Harrington, who said that Shelanski's name was incorrectly added to the Mercatus website's list of Technology Experts. According to Goad's article, Harrington maintained that (quoting the article) "Shelanski should have been listed among the ranks of speakers who have participated in Mercatus programs, but was 'incorrectly categorized' as an expert. 'We fixed the error once it was pointed out to us,' Harrington said."
Full textA few months ago, I urged the Obama Administration to view the nomination of a second-term Administrator of the Office of Information and Regulatory Affairs (OIRA) as an opportunity to fundamentally change the role that the office plays in the regulatory system. Dozens of important rules got stuck at OIRA in the year before the presidential elections and are still languishing. House Republicans continue their blistering and unsubstantiated attacks on the agencies, doing everything they can to cut their budgets beyond the bone, while the Obama Administration does nothing to rebut these tirades. And most agencies at the federal, state, and local levels are on life support, unable to prevent, much less mitigate a series of deadly fiascos. As just two very recent examples: consider the explosion at a West Texas fertilizer factory that claimed 15 lives several days ago, catching emergency response crews at their most vulnerable, and yesterday’s front page story in the Washington Post about a rule that would gravely endanger worker and consumer safety at poultry processing plants. The job of the next “regulatory czar” won’t be easy unless he conceives of it as a continuation of the first Obama term’s “rule busting” that placates dangerous industries at the expense of public health.
Late yesterday, President Obama announced the nomination of Howard Shelanski, a current Federal Trade Commission official (FTC), to be the agent of change that OIRA so desperately needs. We'll certainly take a close look at his record in the days ahead, but one thing is certain: The Senate will need to conduct a thorough and searching confirmation process, one aimed at ensuring that OIRA stops being the place where badly needed safeguards for health, safety and the environment go to die.
Dr. Shelanski has spent his career working in the arenas of antitrust and telecommunications, two specialties far removed from the core of OIRA oversight that is most controversial. Hopefully, this background means he will approach health and safety issues with an open mind. On the other hand, Dr. Shelanski is also listed as an “expert” in the Mercatus Center’s Technology Policy Program. (His Mercatus Center bio is here.) The Mercatus Center is an industry-funded think tank and is well known for strongly advocating for anti-regulatory policies, indicating that in his new position, he must work especially hard to consider divergent views.*
Dr. Shelanski’s nomination will come before the Senate Committee on Homeland Security and Government Affairs. The members of that committee must take that opportunity to ask him tough questions. For example, as OIRA Administrator, will Dr. Shelanski see it as job to advance the public interest or to appease regulated industries? Who does Dr. Shelanski think should be in charge of the substance of EPA’s regulatory decision-making: the EPA Administrator or the OIRA Administrator? When it comes to agency decision-making, will OIRA continue to insist on substituting biased cost-benefit analyses for the impact analyses specified in statute? Will Dr. Shelanski abide by the transparency requirements imposed on OIRA by Executive Order 12866? Will he encourage agencies to follow the Order’s transparency requirements as well? Finally, will Dr. Shelanski respect the clear 90-day time limits that Executive Order 12866 places on regulatory review?
We look forward to meeting Dr. Shelanski and doing our best to persuade him that a fundamental course correction at OIRA is vital. Without one, there will be more grim funeral services honoring lives lost unnecessarily in industrial catastrophes that escape a badly shredded safety net.
Full text