Category Archives: Reform

Senators Introduce Regulatory Commission Bill

CEI’s approach to regulatory reform has an overarching theme: It is not enough to get rid of this or that harmful regulation. For the benefits to last, there must be system-level reform to the rulemaking process that keeps generating those rules. Institutions matter. One of the best of those institution-level reform ideas now has COVID-19-focused legislation at the ready: the independent regulatory reduction commission.

Senators James Lankford (R-OK), Ron Johnson (R-WI), and Rob Portman (R-OH) have introduced the Pandemic Preparedness, Response, and Recovery Act (PPRRA). The House version was previously introduced by Rep. Virginia Foxx (R-NC). The bill would establish an independent commission to identify regulations harming the COVID-19 response, and compile a package for Congress to vote on.

Wayne Crews and I have a statement supporting the idea here.

The idea is not new. Former Sen. Phil Gramm introduced a version of the idea back in the 1980s. The Base Realignment and Closure (BRAC) commissions that closed unneeded military bases had four rounds in the 1990s, and saved billions of dollars. CEI has been promoting the idea for more than a decade, most recently in a Washington Examiner op-ed and  #NeverNeeded paper. Several other legislative versions of the regulatory BRAC commission have been introduced by lawmakers from both parties.

The time to act is now. If House and Senate leadership, not wanting to make any waves before the election, do not act, then the PPRRA should be reintroduced in the next Congress, and on and on until it passes. Regulatory reform is a long game, but with people hurting from COVID-19 and a tough recovery ahead, this is an idea that Congress should act on now.

New CEI Video: Eliminating Never Needed Regulations to Help with Recovery

In a new CEI video, Kent Lassman talks about three things agencies can do rein in regulations that are hindering the COVID-19 response and making economic recovery even harder. Congress should establish an independent regulatory reduction commission. Agencies should go over their own rules and policies and prune them. And new rules should have automatic sunsets

On their own, members of Congress have neither the incentive nor the ability to thoroughly trim regulations. So, they should do what they did the last time they hit an impasse like this—establish an independent commission. When the Cold War ended and the military needed fewer bases, no one representative would vote to close the one in his or her district, even if the base’s resources would do more good if used differently, because they didn’t want to face the political backlash.

The Base Realignment and Closure (BRAC) commission solved the problem. It studied the situation and sent Congress a plan for which bases to keep and which to shrink or close. This was then put to an up-or-down vote, without possibility for amendment. The streamlining of the military worked. Individual members of Congress could avoid blame for specific base closures. And voters understood that if their base was affected by BRAC, it was a fair decision made for a good reason. Four rounds of BRAC saved billions of dollars.

We should do something similar for regulation. In fact, the idea has been around since the early 1980s, when Sen. Phil Gramm proposed a version of it. After other occasional proposals from both parties, Rep. Virginia Foxx (R-NC) has just proposed her version of a regulatory BRAC. It’s a good idea, and it’s being taken seriously. With regulations harming the coronavirus response and the economy, now is the time to act on it.

Agencies should also so their own housework. Executive orders from President Trump have required agencies to get rid of two old rules for each new rule they enact; publish guidance documents in a single, searchable place in order to fight against the problem of regulatory “dark matter;” and most recently, to encourage agencies to use their emergency powers to wave rules that are getting in the way of an effective COVID response.

Finally, new regulations should have automatic sunsets. Just as cartons of milk have an expiration date, so should regulations. Times change; regulations often don’t. This rule would give agencies an incentive to periodically revisit and modernize their rules. Letting obsolete or harmful ones go is as simple as doing nothing; this is a fitting setup for a Congress that is rarely brave enough to take a stand on anything.

Please share the video on social media. For more on these proposals, see my recent paper “How to Make Sure Reformed #NeverNeeded Regulations Stay That Way.” More ideas are at neverneeded.cei.org.

How to Spot a #NeverNeeded Regulation

Regulatory reform is one of the most important weapons there is for fighting COVID-19 and for aiding the economic recovery after the worst passes. But with 1.1 million regulatory restrictions and 185,000 pages of rules at the federal level alone, where should policy makers start? This handy infographic shows policy makers and regulators what to look for. If a rule meets one or more of these guidelines, it is probably a #NeverNeeded regulation.

  • It slows distribution of proved medical diagnostic tests and services.
  • It blocks patients’ remote access to medical providers.
  • It increases the cost of energy at a time when people can least afford it.
  • It makes it more difficult to hire employees.
  • It adds another layer of bureaucracy or complexity to legal compliance.
  • It blocks access to capital for both consumers and businesses.

A good rule of thumb is that if a regulation isn’t needed now, during a pandemic, then it probably was never needed in the first place.

Getting rid of #NeverNeeded regulations should be a top priority for lawmakers and regulators. But it is also not enough. Regulatory sludge has been building up for decades. Federal agencies issue more than 3,000 new regulations in most years, and usually remove old or outdated rules only when forced to. Reforming the rulemaking process itself, so that it generates fewer #NeverNeeded rules going forward, will be essential to resilience against the next crisis. If net neutrality rules hadn’t been repealed, for example, people in the U.S. would have had to deal with congested, throttled networks, such as many Europeans have been dealing with. The transition to new technologies, such as telemedicine and Zoom meetings for students and workers, would have been more difficult, or even impossible.,

For more resources on identifying and reforming #NeverNeeded regulations, see neverneeded.cei.org.

Speaking at #NeverNeeded Event on June 22 with OIRA Administrator Paul Ray, CEI’s Kent Lassman, Wayne Crews

On Monday, June 22 at 11:00 ET, CEI is holding a Zoom event on regulatory reform with Paul Ray, who heads the Office of Information and Regulatory Affairs inside the Office of Management and Budget. That’s the agency most directly involved in monitoring the federal regulatory state.

Also speaking at the event are CEI president Kent Lassman, vice president for policy Wayne Crews, and me.

Registration is here. Afterwards, the event will be posted to YouTube. I’ll post a link when it’s up.

Congress Has Already Introduced Bills to Reform #NeverNeeded Regulations

Policy makers have already waived more than 350 regulations and counting that were slowing the pandemic response and harming economic recovery. But with a 185,000-page Code of Federal Regulations and plenty more rules at the state and local levels, there is more to do. Fortunately, a number of bills have already been introduced in Congress that could help get rid of more #NeverNeeded regulations.

CEI’s Agenda for Congress has more reform ideas, though not all of them are applicable to the #NeverNeeded effort. For a guide on identifying #NeverNeeded regulations, see our handy infographic. We also a have a short paper full of reform ideas and the neverneeded.cei.org website. And of course, the #NeverNeeded social media hashtag is a continuing source of new ideas.

Fixing the Regulatory Process

Regulations from the Executive in Need of Scrutiny (REINS) Act (S. 92) 

This bill would require Congress to vote on new regulations costing more than $100 million per year. The Senate version is sponsored by Rand Paul (R-KY), Chuck Grassley (R-IA), Joni Ernst (R-IA), Todd Young (R-IN), and Ted Cruz (R-TX). Rep. Jim Sensenbrenner (R-WI) sponsors the House version. The REINS Act is a separation of powers bill intended to make sure agencies don’t go rogue and pass major rules Congress never authorized through legislation.

While the REINS Act would affect fewer than 50 rules in an average year out of more than 3,000, it would add stability to an uncertain regulatory climate. Agencies would have to stay within the bounds Congress has legislated for them, and would not be able to pass hasty “flash policy” that could hurt the virus response and economic recovery. For more, see my paper on the REINS Act.

Guidance Out Of Darkness (GOOD) Act (S.380)

Agencies are required to put new regulations through a notice-and-comment rulemaking process. This allows the public to see and contribute to draft versions of regulations before they become final. But agencies routinely avoid this transparency and accountability by enacting regulation through other means such as guidance documents, memoranda, or even press releases and blog posts. CEI’s Wayne Crews calls these extralegal rules “regulatory dark matter.” Courts routinely defer to dark matter in cases, meaning it has de facto force of law.

President Trump issued an Executive Order last year requiring agencies to make all of their guidance documents public. This is an excellent start, but the problem with Executive Orders is that the next president can undo them on a whim. Dark matter reform needs the permanence that comes with congressional legislation. The GOOD Act, sponsored by Sen. Ron Johnson (R-WI) and Rep. Mark Walker (R-NC), would increase agency transparency and accountability. It would also add stability to the regulatory environment that recovering businesses can plan around during a chaotic time. Wayne Crews has more on regulatory dark matter here.

Jones Act Repeal

Open America’s Waters Act of 2019 (S. 694) 

The Jones Act costs the economy somewhere between $656 million to $9.8 billion per year. The Open America’s Waters Act, sponsored by Sen. Mike Lee (R-UT), would repeal it entirely. The Jones Act is a shipping law from 1920 that is essentially a Buy American law for moving goods between U.S. ports. Incumbent shipping companies love the Jones Act for obvious reasons—it keeps competition out. But because of the Jones Act, shipping between U.S. ports is slow and expensive.

There is little incentive to innovate or save costs, and the ships are aged and small, since there is little need to invest in fleet improvements in a government-protected cartel. This contrasts sharply with international shipping, where the Jones Act does not apply. When competition is allowed, shipping is cheaper, faster, more reliable, and more competitive.

An effective coronavirus response needs medical supply networks to be fast, flexible, and affordable. Improved shipping will also aid in the coming economic recovery. The Jones Act has long been obsolete. Now is the ideal time to finally get rid of it, and the Open America’s Waters Act would do just that. CEI’s Mario Loyola’s forthcoming Jones Act paper has more.

Protecting Access to American Products Act (S. `1873)

If outright repeal of the Jones Act proves not possible politically, then this bill, also sponsored by Sen. Lee, is a second-best backup plan. It would streamline the Jones Act waiver process

National Environmental Policy Aact Reform

Federal Permitting Reform and Jobs Act (S. 1976)

This bill would ease environmental permitting and other obstructions that delay infrastructure projects. It builds on previous reforms in the Fix America’s Surface Transportation Act of 2015. The Senate version is sponsored by Sen. Rob Portman (R-OH) and the House version’s bipartisan sponsors include Reps. Kelly Armstrong (R-ND), Rob Bishop (R-UT), and Collin Peterson (D-MN). Congress is clearly committed to trillions of dollars of “flash policy” such as stimulus and bailouts. Much of it will be wasteful, but reforms such as this bill will help at least a little more of that money spent on projects instead of on red tape.

This list is only a beginning. Adding to it would help public health during the COVID-19 response and with economic recovery when it is safe again. Policy makers can find plenty of ideas in CEI’s new #NeverNeeded paper, as well as our Agenda for Congress.

CEI #NeverNeeded Panel Event Now on YouTube

The link is here. The speakers include my colleagues Kent Lassman, Iain Murray, and me.

For the next several weeks, there will be new online events each Tuesday featuring CEI experts on a variety of reform areas. More information is at cei.org.

Repeal for Resilience: CEI #NeverNeeded Online Event on April 21

This coming Wednesday, April 21 at 11:30 ET, I’ll be speaking in an online event with my colleagues Iain Murray and Kent Lassman. We’ll be discussing how regulatory reform can help keep people safe during the pandemic while helping minimize the economic damage.

The event will be held using the Zoom video conferencing program. If you would like to attend, the link to signup is here.

CEI NeverNeeded Event 200421

The #NeverNeeded Regulatory Reduction Commission

Over at the Washington Examiner, I propose a Regulatory Reduction Commission to act as a permanent watchdog to prevent #NeverNeeded regulations from hindering the next pandemic response. It would work like this:

First, no amendments should be allowed to the committee’s package. The vote must be straight up-or-down. The commission’s purpose is to avoid vote-trading and back-scratching. …

Second, the committee would be relatively small to reduce bargaining costs and make consensus easier to reach. It would also be bipartisan, so neither party can stack the deck when it is in power.

Third, the committee’s design has to account for the sheer size of the problem. … So it would tackle, say, five of the Code of Federal Regulations’ 50 titles per year in a 10-year rotation.

Read the whole piece here.

More regulatory reform ideas that could strengthen future crisis responses are in CEI’s Ten Thousand Commandments annual report.

CEI Commends White House for Executive Action Restricting Use of Regulatory Dark Matter

This is a CEI press statement, originally posted at CEI.org.

The White House today announced President Trump will sign two Executive Orders aimed at stopping the practice of agencies using guidance documents to effectively implement policy without going through the legally required notice and comment process. CEI Vice President for Policy Wayne Crews has long advocated executive action aimed at curtailing the use of “Regulatory Dark Matter” or guidance documents.

CEI Vice President for Policy and A Partial Eclipse of the Administrative State: A Case for an Executive Order to Rein in Guidance Documents and other “Regulatory Dark Matter” author Wayne Crews said:

“I commend President Trump and the White House for taking strong executive action aimed at restraining agencies from using guidance documents or ‘Regulatory Dark Matter’ to effectively implement policy without at least adhering to the legally required notice and comment process created by the Administrative Procedure Act nor submitting guidance to Congress and the GAO as required for review. CEI has long been making the case that the Administrative State cannot be tamed until the proliferation of guidance and dark matter is addressed. This executive order is a vital start; in the future, Congress will also need to act in order to completely stop the practice of regulating through guidance documents.

“In the absence of a Congress willing to address this important issue, it is critical for the president to sign executive orders like these in order to advance the cause of regulatory reform and cement his legacy as a deregulatory president.”

CEI President Kent Lassman said:

“Progress was made today. The President makes clear through executive orders that undemocratic, unresponsive, and unaccountable agency action is on a path to extinction. More work is required to reestablish a proper separation of powers and limits on administrative authority however the executive orders on guidance, regulatory dark matter, and transparency are a necessary disinfectant to a diseased regulatory state.”

CEI Senior Fellow Ryan Young said:

“Restoring a healthier separation of powers requires effort from all three branches. Hopefully today’s Executive Order will jump-start that needed process. Congress now needs to strengthen transparency and other protections against agency abuses with legislation, which is more permanent than an Executive Order.

“This has so far been a missed opportunity for congressional Democrats, who have an opportunity to rein in a too-powerful executive branch, and to do it with bipartisan cooperation. Over in the judicial branch, the Supreme Court needs to end the judiciary’s near-automatic acquiescence to agencies in upcoming cases concerning Chevron deference and Auer deference.”

Read more:

Re-Prioritizing Regulatory Reform

The 2019 edition of Wayne Crews’ Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State is out now. It contains basic data on the regulatory state that is harder to find than it should be: how many regulations agencies issue, how much they cost, and what is coming up next. Wayne also has several reform ideas, from a regulatory budget akin to the government’s sending budget, to improved disclosure and cost accounting standards, to more congressional involvement in the rulemaking process.

If you prefer a shorter version, Wayne and I have a piece at National Review sharing the main findings and making the case for re-prioritizing regulatory reform:

President Trump, who made regulatory reform a priority early in his term, claims to have reduced federal regulatory burdens by $23 billion in fiscal year 2018. That’s the good news. The bad news is that he has hinted at declaring premature victory and given indications of abandoning the issue altogether.

Congress should also be on board:

Congress has shown interest in executive-branch transparency in matters concerning Trump himself. It should extend that interest to regulatory agencies over which President Trump wields power.

Read the whole piece here. The new 2019 edition of Ten Thousand Commandments is here, and a summarizing press release is here.