[Infowarrior] - Bush Directive Increases Sway on Regulation

[Richard Forno]

January 30, 2007
Bush Directive Increases Sway on Regulation
By ROBERT PEAR
http://www.nytimes.com/2007/01/30/washington/30rules.html?ei=5094&en=f7bdc9f
4cbb28c31&hp=&ex=1170133200&partner=homepage&pagewanted=print

WASHINGTON, Jan. 29 ‹ President Bush has signed a directive that gives the
White House much greater control over the rules and policy statements that
the government develops to protect public health, safety, the environment,
civil rights and privacy.

In an executive order published last week in the Federal Register, Mr. Bush
said that each agency must have a regulatory policy office run by a
political appointee, to supervise the development of rules and documents
providing guidance to regulated industries. The White House will thus have a
gatekeeper in each agency to analyze the costs and the benefits of new rules
and to make sure the agencies carry out the president¹s priorities.

This strengthens the hand of the White House in shaping rules that have, in
the past, often been generated by civil servants and scientific experts. It
suggests that the administration still has ways to exert its power after the
takeover of Congress by the Democrats.

The White House said the executive order was not meant to rein in any one
agency. But business executives and consumer advocates said the
administration was particularly concerned about rules and guidance issued by
the Environmental Protection Agency and the Occupational Safety and Health
Administration.

In an interview on Monday, Jeffrey A. Rosen, general counsel at the White
House Office of Management and Budget, said, ³This is a classic
good-government measure that will make federal agencies more open and
accountable.²

Business groups welcomed the executive order, saying it had the potential to
reduce what they saw as the burden of federal regulations. This burden is of
great concern to many groups, including small businesses, that have given
strong political and financial backing to Mr. Bush.

Consumer, labor and environmental groups denounced the executive order,
saying it gave too much control to the White House and would hinder
agencies¹ efforts to protect the public.

Typically, agencies issue regulations under authority granted to them in
laws enacted by Congress. In many cases, the statute does not say precisely
what agencies should do, giving them considerable latitude in interpreting
the law and developing regulations.

The directive issued by Mr. Bush says that, in deciding whether to issue
regulations, federal agencies must identify ³the specific market failure² or
problem that justifies government intervention.

Besides placing political appointees in charge of rule making, Mr. Bush said
agencies must give the White House an opportunity to review ³any significant
guidance documents² before they are issued.

The Office of Management and Budget already has an elaborate process for the
review of proposed rules. But in recent years, many agencies have
circumvented this process by issuing guidance documents, which explain how
they will enforce federal laws and contractual requirements.

Peter L. Strauss, a professor at Columbia Law School, said the executive
order ³achieves a major increase in White House control over domestic
government.²

³Having lost control of Congress,² Mr. Strauss said, ³the president is doing
what he can to increase his control of the executive branch.²

Representative Henry A. Waxman, Democrat of California and chairman of the
Committee on Oversight and Government Reform, said: ³The executive order
allows the political staff at the White House to dictate decisions on health
and safety issues, even if the government¹s own impartial experts disagree.
This is a terrible way to govern, but great news for special interests.²

Business groups hailed the initiative.

³This is the most serious attempt by any chief executive to get control over
the regulatory process, which spews out thousands of regulations a year,²
said William L. Kovacs, a vice president of the United States Chamber of
Commerce. ³Because of the executive order, regulations will be less onerous
and more reasonable. Federal officials will have to pay more attention to
the costs imposed on business, state and local governments, and society.²

Under the executive order, each federal agency must estimate ³the combined
aggregate costs and benefits of all its regulations² each year. Until now,
agencies often tallied the costs and the benefits of major rules one by one,
without measuring the cumulative effects.

Gary D. Bass, executive director of O.M.B. Watch, a liberal-leaning consumer
group that monitors the Office of Management and Budget, criticized Mr.
Bush¹s order, saying, ³It will result in more delay and more White House
control over the day-to-day work of federal agencies.²

³By requiring agencies to show a Œmarket failure,¹ ² Dr. Bass said,
³President Bush has created another hurdle for agencies to clear before they
can issue rules protecting public health and safety.²

Wesley P. Warren, program director at the Natural Resources Defense Council,
who worked at the White House for seven years under President Bill Clinton,
said, ³The executive order is a backdoor attempt to prevent E.P.A. from
being able to enforce environmental safeguards that keep cancer-causing
chemicals and other pollutants out of the air and water.²

Business groups have complained about the proliferation of guidance
documents. David W. Beier, a senior vice president of Amgen, the
biotechnology company, said Medicare officials had issued such documents
³with little or no public input.²

Hugh M. O¹Neill, a vice president of the pharmaceutical company
Sanofi-Aventis, said guidance documents sometimes undermined or negated the
effects of formal regulations.

In theory, guidance documents do not have the force of law. But the White
House said the documents needed closer scrutiny because they ³can have
coercive effects² and ³can impose significant costs² on the public. Many
guidance documents are made available to regulated industries but not to the
public.

Paul R. Noe, who worked on regulatory policy at the White House from 2001 to
2006, said such aberrations would soon end. ³In the past, guidance documents
were often issued in the dark,² Mr. Noe said. ³The executive order will
ensure they are issued in the sunshine, with more opportunity for public
comment.²

Under the new White House policy, any guidance document expected to have an
economic effect of $100 million a year or more must be posted on the
Internet, and agencies must invite public comment, except in emergencies in
which the White House grants an exemption.

The White House told agencies that in writing guidance documents, they could
not impose new legal obligations on anyone and could not use ³mandatory
language such as Œshall,¹ Œmust,¹ Œrequired¹ or Œrequirement.¹ ²

The executive order was issued as White House aides were preparing for a
battle over the nomination of Susan E. Dudley to be administrator of the
Office of Information and Regulatory Affairs at the Office of Management and
Budget.

President Bush first nominated Ms. Dudley last August. The nomination died
in the Senate, under a barrage of criticism from environmental and consumer
groups, which said she had been hostile to government regulation. Mr. Bush
nominated her again on Jan. 9.

With Democrats in control, the Senate appears unlikely to confirm Ms.
Dudley. But under the Constitution, the president could appoint her while
the Senate is in recess, allowing her to serve through next year.

Some of Ms. Dudley¹s views are reflected in the executive order. In a primer
on regulation written in 2005, while she was at the Mercatus Center of
George Mason University in Northern Virginia, Ms. Dudley said that
government regulation was generally not warranted ³in the absence of a
significant market failure.²

She did not return calls seeking comment on Monday.