Posted: Thursday, January 27, 2011 10:00 AM
Last week President Obama issued an executive order that will require federal agencies to review their rules and regulations.
The objective of the review, according to the president, is to get rid of out-of-date and redundant regulations, to ensure that new regulations are as cost-effective and minimally burdensome as possible. Regulations, according to the president, must be "compatible with economic growth, job creation and competitiveness."
We laud the president's public comments on the subject and are happy that he recognizes that the federal regulatory juggernaut can have a devastating effect on the engines of the economy. Anything that can be done to make the business of regulation more reasonable is worthwhile.
On its face, there are several things in the order we find encouraging.
Under the order, agencies must consider costs and benefits and choose the least burdensome option. The president wants to eliminate regulations that are no longer necessary, are redundant or are contradictory. The president also said he wants agencies with overlapping authority to work to harmonize and simplify their efforts.
The order also encourages agencies to specify performance standards rather than mandate specific methods of compliance. If successful, that will give businesses a great deal of flexibility to meet regulatory requirements.
The president wants greater public input in the regulatory process. While public participation is provided under law, the order seeks greater communication between the regulators and the regulated, and other interested parties.
A careful reading of the order, however, gives us a few reasons for concern.
The White House says all regulations must be "guided by objective scientific evidence." We agree, but we've seen instances where the administration has ignored science when it thought something else was needed.
The order leaves it up to each agency to come up with a plan for its review of existing regulations. Beyond the very broad guidelines provided in the executive order, it appears bureaucrats within each department and agency are free to interpret the order's intent, and to prescribe a methodology for the review. We are skeptical that regulators can objectively judge the relevance of their own handiwork.
Agencies must formulate their plans within 120 days. Nothing in the order specifies when the review must be completed, or indicates how the public at large, or the regulated in particular, will be told the results. Results, not the exercise itself, are presumably the point.
There will be plenty of opportunity to judge this order's impact on new regulation. Much of the nuts and bolts of health care reform is left to the secretary of health and human services and her department to craft. The Food and Drug Administration is in the process of writing regulations for the new food safety law. And the Environmental Protection Agency's upcoming regulation of greenhouse gases will surely put the president's stated objectives to the test.