It's become almost an article of faith among politicians that Americans hate regulation. Republicans have campaigned against it for years, maintaining without actual facts to back them up that regulation is job-killing and economy-crippling. Democrats sometimes say the same things, if perhaps in a softer tone of voice, and rarely — very rarely — do they stick up for regulation.
The Member Scholars of the Center for Progressive Reform believe in regulation. They support sensible safeguards to breathe life into laws protecting health, safety, the environment, the economy, health care and more — laws like the Clean Air Act, the Clean Water Act, the Affordable Care Act, the Occupational Safety and Health Act, the Food Safety Modernization Act, and many others. Such laws were passed by strong majorities in Congress, and the regulations written pursuant to them are in many cases mandated by statute, and in all cases, adopted on the strength of the authority in those laws. Regulations are not created out of the whole cloth, not plucked from thin air; they are written pursuant to acts of Congress.
Moreover, regulations bring enormous benefits. Clean Air Act regulations save tens of thousands of lives a year, for example. And the list of now commonplace reforms that have had a powerful impact on society is long — including safety belts in automobiles, various accommodations for Americans with disabilities, protections for the nation's food supply, bans on dangerous chemicals, limits on air and water pollution, and more.
But the politics of regulation ignores much of that reality. Conjuring up images of red tape and "unelected bureaucrats," and often relying on hostility to local regulations (health codes and zoning ordinances, for example), industry and its allies battle against regulation as a way to refight battles they've long since lost in Congress — lost because their positions in favor of industry's "right" to pollute the environment, produce unsafe products, and subject their workers to unsafe conditions on the job, were simply unpersuasive when Congress considered the matters.
In recent years, opponents of regulation have offered a variety of legislative proposals aimed at cutting the legs out from under regulation, essentially seeking to enfeeble landmark pieces of health, safety, and environmental protection legislation.
Injecting More Politics into Regulation: The REINS Act, Legislation to Prevent Regulating Greenhouse Gas Emissions
One such proposal intended to gum up the regulatory system is the proposed REINS Act. It would prevent new health, safety, environmental and other regulations from going into effect unless both houses of Congress vote within 70 days of promulgation to approve them, by means of a joint congressional resolution. Congress can already vote to block regulations, but the proposed approach would stack the deck against much-needed regulations, by harnessing the power of congressional delay and gridlock in service of an anti-regulatory agenda, and allowing a single house of Congress to block enforcement of federal law simply by failing to vote. In December 2010, CPR's Sidney Shapiro penned an editorial memorandum on the subject. And several Member Scholars published op-eds in papers across the nation. (See David Driesen in the Syracuse Post-Standard,Noah Sachs in the New Republic, and Joe Tomain in the Cincinnati Enquirer.)
Another GOP proposal, embodied in the TRAIN Act, would establish an inter-agency panel to review EPA's Clean Air Act and coal ash regulations, including those addressing greenhouse gas emissions, to assess their cumulative economic impact. As CPR's Rena Steinzor said in testimony about the bill before a subcommittee of the House Energy and Commerce Committee, the real effect of the bill would be to take decisions about environmental regulation out of the hands of environmental regulators. Moreover, the bill completely ignores the benefits of regulation, which have been calculated and found to be much greater than the costs. Read a blog post on the bill and Steinzor's testimony.
Still another proposed "solution" to the imagined problem of over-regulation is to put regulation on a sort of budget, allowing safeguards for only so many hazards. Known as "Regulatory Pay-Go," the proposal was even embraced by Republican Presidential nominee Mitt Romney. The idea is to cap the total cost of regulation, regardless of the benefits those regulations produce, and the gimmick backing it up would be a requirement that whenever a new regulation is adopted, a regulation or set of regulations imposing equal or greater costs would be removed from the books. The plan would thus force regulatory agencies to choose which hazards the public should be exposed to, rather than focusing on the straightforward task with which they are charged by statute: protecting the public from such hazards.
In all these battles, regulatory opponents have relied on a dramatically overstated estimate of the cost to industry of regulation, based on a report commissioned by the Small Business Administration’s Office of Advocacy that fixed the one-year cost of regulation at $1.75 trillion. In February 2011, CPR Member Scholar Sidney Shapiro, together with Ruth Ruttenberg, Ph.D., Professor of Economics, National Labor College, and CPR Policy Analyst James Goodwin, published a report debunking this most conspicuous bit of rhetoric in the anti-regulatory arsenal. Their white paper examined the SBA’s report (called the Crain and Crain report, for its authors), and concluded that it was based on flimsy evidence and fuzzy math. Most conspicuously, it made no effort to account for the economic benefits of regulation – which according to the Office of Management and Budget are larger than the costs – rather like asserting that buying a car is a drain on the economy because it costs the purchaser money, without accounting for jobs created, profit made, etc.
In 2013, the SBA's Office of Advocacy, in response to the widespread criticism of its report, made a startilng acknowledgement in a statement issued on its website. Noting a handful of the shortcomings of the research it commissioned and then widely publicized -- that it uses "certain assumptions" to reach its "estimates," that it is not a "precise accounting of the overall costs of regulation," that it "cannot appropriately be used to inform discussion about any regulatory costs that have or have not been incurred since 2008" -- the Office of Advocacy goes on to say that its findings have been taken out of context, presumably by anti-regulatory advocates, writing that: "[S]ince the latest iteration of the study was released, the findings of the study have been taken out of context and certain theoretical estimates of costs have been presented publicly as verifiable facts." CPR's Shapiro was the first to take note of SBA's walkback, writing in a Huffington Post article that, SBA was suffering from "buyer's remorse."
To get beyond the legislation-by-focus-grouped-bill-naming approach that has become the stock in trade of anti-regulatory legislators, CPR Senior Policy Analyst James Goodwin has prepared a series a bill analyses, each covering individual legislative proposals offered in the name of regulatory reform. They include:
$1.75 Trillion Fiction. Read a white paper from CPR Member Scholar Sidney Shapiro; Ruth Ruttenberg, Ph.D., Professor of Economics, National Labor College; and CPR Policy Analyst James Goodwin on the risible assertion that regulation imposes $1.75 trillion in annual costs on the economy.
Pay-Go Issue Alert: Read a report from CPR Member Scholars Sidney Shapiro and Richard Murphy, with CPR Policy Analyst James Goodwin, dissecting the Pay-Go proposal.