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Senate Hearing to Bring Some Sanity to the Debate Over Federal Regulatory Policy

Tomorrow, a new panel in the Senate Judiciary Committee—the Subcommittee on Oversight, Federal Rights, and Agency Action—will bring some much-need sanity to the discussion of federal regulatory policy when it holds a hearing entitled “Justice Delayed: The Human Cost of Regulatory Paralysis.” What’s so refreshing about this hearing is that it starts from the premise that blocked and delayed safeguards are a problem that needs to be solved. 

Crucially, this hearing will provide an opportunity to shine a light on the costs that are imposed on the public when regulations aimed at protecting people and the environment are unnecessarily delayed. These costs represent real harm to real people—and they are by definition preventable.

Previously, in this space, I examined the costs to the public that would result from the new delays to three rules that were announced in the Spring 2013 Regulatory Agenda. These included at least 300 premature deaths from the delay of the National Highway Traffic Safety Administration’s (NHTSA) Rearview Mirror Rule and at least 1,000 premature deaths and 1,467 non-fatal heart attacks that would result from the delay of the EPA’s updated ozone National Ambient Air Quality Standard (NAAQS). All of these costs are preventable, but not prevented.

Several of the scheduled witnesses for tomorrow’s Senate Judiciary hearing will help to provide a clear picture of what the costs of regulatory delay entail. CPR President Rena Steinzor will testify about how environmental regulations have benefited the public greatly, and how the continued delay of several pending safeguards—such as the Environmental Protection Agency’s (EPA) rules to control disposal of hazardous coal ash waste and to require cleaner-burning automobile fuel—produce great harm.

Tomorrow’s hearing is a welcome development, because when it comes to the issue of federal regulatory policy, sanity has been in short supply on Capitol Hill for the last four-plus years. And the timing of the hearing couldn’t be better, as it takes place during what House Republicans are calling “Stop Government Abuse Week,” a week dedicated to bashing public servants and voting on ill-conceived bills, including the REINS Act and the Energy Consumers Relief Act, which if passed, would make it all but impossible for the EPA and other agencies to carry out their congressionally mandated missions of safeguarding the public.

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By the Numbers: The Costs of New Regulatory Delays Announced in the Spring 2013 Regulatory Agenda

“April showers bring May flowers.” To that well-known spring-related proverb one might soon add “the Spring Regulatory Agenda brings new groundless complaints from corporate interests and their anti-regulatory allies in Congress about so-called regulatory overreach.” Last Wednesday, the Obama Administration issued the 2013 edition of the Spring Regulatory Agenda, one of two documents the President must issue every year (the other is published in the fall) that compiles and summarizes the various regulatory actions that the Administration expects to take in the near future. Over the past few years, regulatory opponents have grown fond of pointing to the Spring and Fall Regulatory Agendas as still further evidence of the so-called “regulatory tsunami” that is allegedly hindering the economy and to support their campaign to “reform” our regulatory system.  I expect that these same groups will waste little time in the coming days to misrepresent the latest regulatory agenda to bolster their attacks on our system of regulatory safeguards.

In fact, a careful comparison of one Regulatory Agenda to the next reveals just the opposite of what regulatory opponents claim: progress on needed safeguards has all but stalled, as new rules have become subject to new delay upon new delay. Rather than documenting a flurry rulemaking activity, the semiannual Regulatory Agenda has become more of a litany of the latest delays of and extensions to expected timelines for issuing proposals or final rules.

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Why is the White House Blocking Rules on Energy Efficiency?

Cross-posted at ACSBlog.

“The easiest way to save money,” President Obama declared in his 2012 State of the Union address, “is to waste less energy.”  In his 2013 State of the Union address, President Obama took another step and issued “a new goal for America”: “let’s cut in half the energy wasted by our homes and businesses over the next twenty years.” The President also vowed that if Congress did not “act soon” to address climate change, he would “direct [his] Cabinet to come up with executive actions we can take, now and in the future, to reduce pollution, prepare our communities for the consequences of climate change, and speed the transition to more sustainable sources of energy.”

Such welcome sentiments! So sensible and right and good! But here is a puzzling fact: at the same moment President Obama was uttering these wise and welcome remarks, his White House was blocking rules to promote the very energy efficiency he was extolling.  Far from urging the Cabinet to come up with executive actions on climate, his own White House was blocking his Cabinet from taking executive actions on climate. That situation persists to this day.

To understand this rather startling state of affairs, we need some background about how the regulatory system works today. Congress has passed laws to increase in many different respects the energy efficiency of the “homes and businesses” the President talked about. Like most complicated contemporary laws, the laws on energy efficiency are implemented by an administrative agency, in this case the Department of Energy (DOE).  DOE writes rules that take the basic mandates given by Congress and give them shape; the agency specifies, for example, just how efficient new refrigerators and microwaves and lamps and buildings must be to meet Congress’s requirements.

Once DOE writes a rule, however, it does not simply issue it. Instead, the rule must first pass through a White House office that oversees the federal rulemaking process – the Office of Information and Regulatory Affairs, or OIRA. Under executive orders reaffirmed or issued by President Obama, no rule deemed significant by OIRA can be issued without OIRA’s approval. In the Obama administration, moreover, OIRA has increasingly become simply a portal into the political machinery of the larger White House. Rules go to OIRA and, from there, to the Domestic Policy Council, the White House economic offices, the White House Chief of Staff, even sometimes the President himself. (The former head of OIRA in this administration, Harvard law professor Cass Sunstein, documents (and lauds) this new reality in his recent book, Simpler: The Future of Government.)

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Natural Gas in the Big Picture:

With advancements in hydraulic fracturing technology, shale gas has dramatically altered domestic energy in the United States.  Some commentators claim that shale gas can address all of our major energy problems. Some consider natural gas a bridge fuel to a clean energy future.  Bills in Congress proposing a federal “Clean Energy Standard” have included natural gas as a qualifying “clean” fuel source. President Obama’s recent State of the Union address emphasized natural gas and renewable energy as important to reshaping American energy use.   

Given the projected impacts of climate change, we have reached a point when the air and water impacts of natural gas development call on policymakers to sort through some key questions with care: How will current and future energy policy position natural gas, explicitly or by default, relative to fossil energy alternatives like renewable energy?  What role should natural gas play in the U.S. energy landscape in the coming decades?  If it is a bridge fuel, where is it leading? Are we poised to over-rely on natural gas, at the expense of rapid renewable energy development?

It is hard to overstate the significance of the energy transition that the United States is currently experiencing. Take a quick peak back: from 1949 until about 2005, U.S. energy exports were flat; imports continued to rise, particularly petroleum; and production and consumption largely grew in tandem.  In 1970, as domestic oil production peaked, consumption and production began to separate from each other.  Domestic production could not keep pace with consumption and, as a consequence, we grew more dependent on foreign energy resources, especially OPEC oil. Fossil fuels dominated our energy economy with renewable resources barely scratching 2-3% of total U.S. energy production.

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Phasing out Fossil Fuels

We will phase out fossil fuels.  We have no choice. They are a finite resource and at some point they will run out.  Admittedly, coal will not run out nearly as quickly as oil, but sooner or later all fossil fuel resources will run out. 

The only question we face is whether we phase out fossil fuels before we have set in motion climate disruption’s worst effects or instead just allow a phase-out to occur through price shocks and shortages that we are ill-prepared to cope with, and risk a climate catastrophe.  Obviously, a managed phase-out makes much more sense.  Climate disruption will plague us with increasingly violent storms, flooding, drought, a spread of infectious diseases, and other calamities.  A reasonably rapid phase-out will help us avoid some of these impacts by first reducing and eventually eliminating emissions of carbon dioxide, the principal greenhouse gas.  At the same time, switching to cleaner fuels will save thousands of lives annually and many more illnesses right away, as burning the fossil fuels that cause climate disruption also causes particulate pollution and urban smog (tropospheric ozone).  A phase-out of fossil fuels also would gradually end destruction of land through coal mining and disastrous oil spills, like that of the Deepwater Horizon.

Although we cannot end fossil fuel use right away, we must move in the direction of a phase-out as rapidly as we can.  Carbon dioxide emitted in the atmosphere adds to the preexisting store of carbon and remains there for a very long time.  Hence, every year of inaction adds to a cumulative store of carbon in the atmosphere, making the climate disruption problem irreversibly worse.

We must rid ourselves of the illusion that we can drill our way to energy and price security.  Oil trades on a world market, even oil coming from the United States.  In 2011, we imported 45% of our oil from abroad, more than half from OPEC countries, and that was the lowest percentage since 1995.  Renewable energy, however, relies overwhelmingly on domestic fuels.  You cannot ship sunlight or wind to China.

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Obama 2.0: Looking Forward, Mindful of the Past

President Obama’s reelection holds the possibility of great progress for public health, safety, and the environment — if, and only if, he recognizes the importance of these issues and stops trying to placate his most implacable opponents.

The weeks leading up to the election brought powerful reminders of two of the challenges at hand:  rising sea levels and more severe storms that scientists say we should expect as a result of unchecked climate change, and a meningitis outbreak that sickened hundreds, thanks to an obscure compounding pharmacy that escaped regulators’ reach. And let’s not forget that we are recovering from an economic downturn in which under-regulation of giant financial institutions played no small part. This is the context, the starting point.

Taking a progressive stance on health, safety, and environmental threats has never been easy politically because the industries most affected by these protections have powerful allies in Washington, a small army of lobbyists, and plenty of money to contribute to politicians who support their opposition to regulation.  So if the President chooses to take the lead on air and water pollution, food and drug safety, and dangerous conditions in the workplace, for example, he will face extraordinary pressure to do the wrong thing.  And, sadly, he did not cover himself with glory during his first term in this area.  Particularly as the campaign drew closer, the President tried to burnish his business-friendly credentials at the expense of needed protections.  Now he has four more years to leave a legacy of leadership on these vital, life-and-death issues.

The stark choices are perhaps best exemplified by climate change.  One path is tragically easy, the other extremely hard. The easy path is to only poke at the edges of greenhouse gas emissions reduction. The hard path is to take aggressive action, using the full powers of the Clean Air Act, to put the country on the path to dramatically reduced greenhouse gas emissions. In not so many years, this choice will be looked back on as one of the key measures of the President’s legacy.  Without any question, history will condemn inaction in no uncertain terms.  But a strong legacy will not depend just on climate. If the President does not act to make government protections stronger and more effective, we will face more tragedies, from fatal foodborne illness to refinery explosions to oil spills that kill people and cost billions.

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The Ugly Side of Interagency Review: Non-Expert Federal Agency Commenters Tried to Tell Expert EPA That Ozone Doesn't Actually Kill People

Internal EPA emails obtained by CPR though a FOIA request reveals that representatives from one or more of the EPA’s peer agencies second-guessed a critical scientific finding undergirding the EPA’s then-pending draft final rule to tighten the ozone standard, claiming that ozone is not associated with mortality impacts. The EPA’s final proposal rightly disregarded the unsound comments and included information on how reducing ozone pollution saves lives.  The rule, estimated to save thousands of lives, was later blocked by the White House. The email provides a rare glimpse at how peer agencies abuse the interagency commenting process by attacking other agencies’ rules—often on matters on which they have comparatively little expertise.

In the August 3, 2011, email, sent while the draft final rule was still undergoing review at the White House Office of Information and Regulatory Affairs (OIRA), Karen Martin, an EPA scientist who was working on the rule, provided her colleagues her initial impressions on the interagency comments regarding the rule, which OIRA had just recently forwarded to the EPA.  Martin noted that some commenters, un-named staff from one of the EPA’s peer agencies, questioned the EPA’s assumption that higher ozone levels contribute to premature deaths.  Martin directly quoted a “set of commenters” who recommended that “EPA remove the assumption that ozone is associated with mortality impacts.” The interagency comments themselves are not available publicly and were not included in the batch of documents sent by EPA in response to CPR's FOIA request.

While technical-sounding, the assumption about the relationship between elevated ozone levels and premature deaths formed a critical part of the agency’s regulatory impact analysis for the rule.  (The draft final analysis, which was the subject of the interagency complaints, is available here.)  In the regulatory impact analysis, the agency explains that it included this assumption at the recommendation of the National Academy of Science (see page 3).  The monetized benefits of preventing ozone-related mortality was to be the second largest source of the rule’s benefits (see page 34); thus, the failure to include these benefits would serve only to distort the rule’s cost-benefit analysis more.  (As practiced, several inherent methodological flaws lead cost-benefit analysis to over-count costs while under-counting benefits, rendering it systematically biased against protective regulations.)

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DC Circuit's Cross-State Decision: A Nearly Inescapable Straitjacket for EPA

Yesterday afternoon, the D.C. Circuit Court of Appeals issued a long-awaited decision on the validity of EPA’s “Cross-State” rule governing interstate transport of pollution. 

The EPA has been trying for more than two decades to come up with a solution to the vexing interstate transport problem, but every attempt has failed. The court has now vacated EPA’s most recent (and most ambitious) attempt to protect the residents of “downwind” states (primarily in New England and the mid-Atlantic) from two pollutants (ozone and fine particulate matter) that can cause a number of adverse health effects, ranging from minor eye irritation to premature mortality.  EPA’s rule was estimated to prevent 13,000 to 34,000 premature deaths every year.

Worse, the court interpreted the Clean Air Act in a way that ensures that EPA may never be able to implement it with the analytical tools currently at its disposal.  If the Obama Administration is serious about protecting children, the elderly, and other vulnerable Americans, it must ask the entire membership of the D.C. Circuit to overturn the panel’s decision.   Failing that, it must appeal the decision to the Supreme Court of the United States.

As states along the East Coast struggled over the years to fulfill their obligation under the Clean Air Act to write state implementation plans (SIPs) capable of achieving the national ambient air quality standards (NAAQS), they discovered that the sources of the pollutants were located in upwind states and were therefore not subject to any legal requirements promulgated by the downwind states.  The complexity of the problem was magnified by the fact that the relationships between upwind state emissions and downwind state ambient air quality were not well understood.

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EPA's New Soot Proposal: The Good News, A Reality Check, Some Hopes, and Some Fears

Today, the EPA announced its new proposed National Ambient Air Quality Standard (NAAQS) for fine particulate matter, commonly referred to as soot.   Soot is one of the most common air pollutants that Americans encounter, and it is extremely harmful to our health and the environment, contributing to premature death, heart attacks, and chronic lung disease. Today’s proposal is a significant step forward that will bring tremendous benefits for the public if and when it is finalized.

The proposal comprises two parts—an annual standard and a daily standard.  EPA is proposing to maintain the daily standard of 35 micrograms per cubic meter of air (hereafter “micrograms”), while lowering the annual standard from 15 micrograms to within the range of 12 to 13 micrograms.  Significantly, this proposal is consistent with the recommendation of the EPA’s scientists, which was endorsed by the Clean Air Science Advisory Committee (CASAC), a committee of leading independent air pollution experts established by the Clean Air Act to advise the agency on the science underlying Clean Air Act rules.

The EPA is to be commended for issuing a soot NAAQS proposal that is supported by the law and science.  Under the Clean Air Act, the agency must set the soot NAAQS at a level that is protective of human health with an adequate margin of safety. Congress intended this standard to protect the most vulnerable members of our society, including children, the elderly, and the chronically ill, and, as the US Supreme Court has recognized, this standard explicitly forbids the consideration of any regulatory costs.   The Clean Air Act further directs the agency to review the underlying science for the standard at least once every five years; if the science shows that the existing standard is not protecting human health with an adequate margin of safety, the agency must set a stronger standard that meets this health-protective goal.

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White House Letter Focusing Debate on Regulatory Costs -- and Not Benefits -- Frustrated EPA Officials, Emails Reveal

By CPR President Rena Steinzor and Media Manager Ben Somberg

Internal EPA emails obtained by CPR through a FOIA request reveal EPA officials’ frustration regarding the White House’s efforts to triangulate House Republicans’ ferocious attacks on regulations. A White House letter last year emphasizing regulatory costs but barely describing the lives saved and injuries avoided by strong protections angered environmental and public health advocates.  The newly released emails show that top EPA officials – who were not even consulted – were also not pleased.

On August 26 of last year, Speaker of the House John Boehner sent President Obama a letter requesting that the Administration provide a list of “planned new rules that would have an estimated economic impact of more than $1 billion.” The goal, of course, was to continue the GOP’s focus on the costs of regulations (the headline of Boehner’s press release: “Citing Spike in Red Tape, Speaker Boehner Seeks Info from White House on Job-Threatening Regulations”). The information Boehner was requesting was already publicly available, but that wasn’t the point; the point was to drive an anti-regulatory message. And it worked: The Washington Post ran a story under the headline “Boehner asks Obama to detail $1 billion regulations.”

And so it was disappointing when the White House took the bait – hook, line, and sinker. President Obama responded to Boehner four days later with a two-page letter that attempted to convince the Speaker (an impossible mission no matter the facts) that the Administration was very busy reducing regulatory costs. In a 19-sentence letter, the President managed only one sentence making the positive case for regulations (“And in 2009 and 2010, the benefits of such rules -- including not only monetary savings but also lives saved and illnesses prevented -- exceeded the costs by tens of billions of dollars.”) The rest of the letter was playing on Boehner’s anti-regulation turf.

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