Category Archives: regulation

This week in the world of regulation:

• Last week, 48 new final rules were published, down from 61 the previous hurricane-shortened week.
• That’s the equivalent of a new regulation every 3 hours and 30 minutes — 24 hours a day, 7 days a week.
• All in all, 3,304 final rules have been published in the Federal Register this year.
• If this keeps up, the total tally for 2012 will be 3,767 new rules.
• Last week, 1,846 new pages were added to the 2012 Federal Register, for a total of 69,271 pages.
• At its current pace, the 2012 Federal Register will run 78,008 pages.
• Rules are called “economically significant” if they have costs of $100 million or more in a given year. The 45 such rules published so far in 2012 have compliance costs of at least $24 billion. Two of the rules do not have cost estimates, and two other rules have cost estimates that do not give a total annual cost. We assume that rules lacking this basic transparency measure cost the bare minimum of $100 million per year. The true cost is almost certainly higher.
• Two economically significant rules were published last week.
• So far, 319 final rules that meet the broader definition of “significant” have been published in 2012.
• So far this year, 623 final rules affect small business; 90 of them are significant rules.

Highlights from final rules published last week:

• Both of this week’s economically significant rules are health care-related. The first rule weighs in at 357 pages, and will increase Medicare spending by $4.571 billion. I am scoring it as zero-cost in our running tally, since this is government spending and not compliance costs.
• A new OSHA rule regulates longshoremen’s headwear.

• The second rule alone is 483 pages long. A coherent cost estimate is not given. Since many of the provisions require extensive paperwork and other compliance measures, as opposed to government spending, I am counting it as costing $100 million, the bare minimum needed for its economically significant status. The real cost is almost certainly higher.

For more data, go to TenThousandCommandments.com.

Most people believe that businesses abhor regulations, and would love to do away with them entirely. This belief is often wrong. Many regulations make it harder for startups to enter the market, and can hobble smaller competitors. That’s why incumbent firms in many industries regularly welcome new regulations with open arms, and will spend millions on lobbying to pass them. It’s a way to keep the competition out.

Here is one historical example from the successful push to deregulate the trucking industry during the 1970s. About the only people who opposed deregulation were in the trucking industry itself. Check out the lengths they went to to preserve anti-competitive regulations:

In the 1978 hearings on trucking before the [Sen. Ted] Kennedy subcommittee, the industry offered the testimony of a paid consultant. Senator Howard M. Metzenbaum, Democrat of Ohio, producing a copy of the consultant’s original proposal, indignantly pointed out that he had essentially promised his study would support regulation before he was hired. Later, in an elaborate statement of its position before the Senate floor debate, the industry gave prominent attention to a purported critique of trucking deregulation by a Stanford University economist. Cited without facts of publication, the source turned out to be a commentary in the Los Angeles Times that was more cautionary than critical and described no research.

-Martha Derthick and Paul J. Quirk, The Politics of Deregulation, p. 125.

Something to keep in mind the next time someone calls a regulatory skeptic an industry shill. The precise opposite is usually the case.

This week in the world of regulation:

• Last week, 61 new final rules were published, up from 60 the previous hurricane-shortened week.
• That’s the equivalent of a new regulation every 2 hours and 46 minutes — 24 hours a day, 7 days a week.
• All in all, 3,256 final rules have been published in the Federal Register this year.
• If this keeps up, the total tally for 2012 will be 3,795 new rules.
• Last week, 1,168 new pages were added to the 2012 Federal Register, for a total of 67,425 pages.
• At its current pace, the 2012 Federal Register will run 77,323 pages.
• Rules are called “economically significant” if they have costs of $100 million or more in a given year. The 43 such rules published so far in 2012 have compliance costs of at least $23.9 billion. Two of the rules do not have cost estimates, and a third cost estimate does not give a total annual cost. We assume that rules lacking this basic transparency measure cost the bare minimum of $100 million per year. The true cost is almost certainly higher.
• One economically significant rule was published last week.
• So far, 313 final rules that meet the broader definition of “significant” have been published in 2012.
• So far this year, 610 final rules affect small business; 88 of them are significant rules.

Highlights from final rules published last week:

• An economically significant health care rule would increase Medicare spending by about $250 million next year on end-stage renal disease. I am scoring this rule as zero-cost in our running tally, since the costs are in government spending, not compliance.
• New residue testing requirements under the National Organic Program.
• The FAA has withdrawn a rule previously mentioned in this space that would have established voluntary licenses for amateur rocketry. Public commenters argued that the rule would be costly for small businesses, rocket enthusiasts, and the government itself, with little in the way of safety benefits. They were persuasive enough that the FAA withdrew the rule. Kudos for listening, FAA.
• The CPSC has released new safety standards for infant swings.
• The Federal Mediation and Conciliation Service has amended its Freedom of Information Act regulations.

This week in the world of regulation:

• In a Hurricane Sandy-shortened work week, 60 new final rules were published, down from 77 the previous week.
• That’s the equivalent of a new regulation every 2 hours and 48 minutes — 24 hours a day, 7 days a week.
• All in all, 3,195 final rules have been published in the Federal Register this year.
• If this keeps up, the total tally for 2012 will be 3,809 new rules.
• Last week, 901 new pages were added to the 2012 Federal Register, for a total of 66,257 pages.
• At its current pace, the 2012 Federal Register will run 78,504 pages.
• Rules are called “economically significant” if they have costs of $100 million or more in a given year. The 42 such rules published so far in 2012 have compliance costs of at least $23.9 billion. Two of the rules do not have cost estimates, and a third cost estimate does not give a total annual cost. We assume that rules lacking this basic transparency measure cost the bare minimum of $100 million per year. The true cost is almost certainly higher.
• One economically significant rule was published last week.
• So far, 307 final rules that meet the broader definition of “significant” have been published in 2012.
• So far this year, exactly 600 final rules affect small business; 85 of them are significant rules.

Highlights from final rules published last week:

• In last week’s economically significant rule, the Education Department revised its Perkins and Ford loan programs to be more favorable to students. This is expected to increase federal spending by $2.1 billion annually from 2012 to 2021. Since the rule has a negligible impact on compliance costs, we are scoring it as zero cost on our running compliance cost tally.
• The Fish and Wildlife Service is allowing seven states to take over falconry permitting within their borders from the federal government. I have written previously on federal falconry policy here.
• The EPA issued a correction to an earlier rule involving aircraft engine emissions.
• The Energy Department issued new energy efficiency test procedures for dishwashers and dehumidifiers.
• The State Department has repealed all of its marriage regulations. Among other things, consular officials may now conduct marriages, as well as serve as witnesses.

For more data, go to TenThousandCommandments.com.

This week in the world of regulation:

• Last week, 77 new final rules were published, up from 71 the previous week.
• That’s the equivalent of a new regulation every 2 hours and 11 minutes — 24 hours a day, 7 days a week.
• All in all, 3,135 final rules have been published in the Federal Register this year.
• If this keeps up, the total tally for 2012 will be 3,825 new rules.
• Last week, 1,043 new pages were added to the 2012 Federal Register, for a total of 64,313 pages.
• At its current pace, the 2012 Federal Register will run 78,553 pages.
• Rules are called “economically significant” if they have costs of $100 million or more in a given year. The 41 such rules published so far in 2012 have compliance costs of at least $23.9 billion. Two of the rules do not have cost estimates, and a third cost estimate does not give a total annual cost. We assume that rules lacking this basic transparency measure cost the bare minimum of $100 million per year. The true cost is almost certainly higher.
• No economically significant rules were published last week.
• So far, 304 final rules that meet the broader definition of “significant” have been published in 2012.
• So far this year, 588 final rules affect small business; 85 of them are significant rules.

Highlights from final rules published last week:

• The EPA was busy last week, publishing 19 new final rules. They are listed here.
• The FAA was also busy, publishing 15 new final rules.
• The FCC is going to take a careful look at your phone bill for unauthorized charges, a practice known as cramming.
• The FDA is amending its animal drug regulations.
• Good news for our friends in Taiwan: starting November 1, Taiwan residents can visit the U.S. for up to 90 days without a visa.
• The Foreign Assets Control Office is amending its Iranian transactions regulations.

For more data, go to TenThousandCommandments.com.

Regulation is traditionally justified in three ways. One is the presence of externalities, such as a factory that pollutes a stream and affects its neighbors. Another is information asymmetry; think of a used car dealer who knows more about his wares than his customers do. Third is monopoly, where a firm can jack up its prices and lower its output without fear of competitors swooping in.

That’s the theory, anyway. Robert Litan and William Nordhaus know that the reality is very different. On page 34 or their 1983 classic Reforming Federal Regulation, they write:

In theory, regulation should arise as a response to market failures. In practice, regulation is more accurately characterized as a government tool for redistributing society’s resources toward those groups that have successfully enlisted the support of the government on their behalf.

Indeed. This public choice-influenced view is a far more useful tool than the traditional theory if the goal is to understand how regulators and regulated actually behave.

For example, the 50 biggest-spending lobbying groups spent $176 million on lobbying from July through September this year. If agencies weren’t cranking out 3,800 new rules per year, and if the Code of Federal Regulations wasn’t 169,000 pages long, it is unlikely that so much money would flow into Washington.

Externalities, asymmetric information, and monopolies are useful concepts for understanding how regulators perhaps should behave. But the important thing is how they do behave.

This week in the world of regulation:

• Last week, 71 new final rules were published, up from 38 the previous, holiday-shortened week.
• That’s the equivalent of a new regulation every 2 hours and 22 minutes — 24 hours a day, 7 days a week.
• All in all, 3,058 final rules have been published in the Federal Register this year.
• If this keeps up, the total tally for 2012 will be 3,820 new rules.
• Last week, 1,991 new pages were added to the 2012 Federal Register, for a total of 64,313 pages.
• At its current pace, the 2012 Federal Register will run 79,204 pages.
• Rules are called “economically significant” if they have costs of $100 million or more in a given year. The 41 such rules published so far in 2012 have compliance costs of at least $23.9 billion. Two of the rules do not have cost estimates, and a third cost estimate does not give a total annual cost. We assume that rules lacking this basic transparency measure cost the bare minimum of $100 million per year. The true cost is almost certainly higher.
• One economically significant rule was published last week.
• So far, 301 final rules that meet the broader definition of “significant” have been published in 2012.
• So far this year, 575 final rules affect small business; 84 of them are significant rules.

Highlights from final rules published last week:

• This week’s economically significant rule is a big one. Strict new CAFE standards, which are minimum gas mileage requirements for car manufacturers’ product lines, were published on Monday. They come into effect starting with the 2017 model year. The EPA estimates annual costs to be $6.49 billion. A minor technical correction was also issued on Friday.
• Oenophiles may be familiar with Washington state’s Columbia Valley winemaking area. The Alcohol and Tobacco Tax and Trade Bureau has established a new Ancient Lakes of Columbia Valley region inside the larger Columbia Valley area.
• A new FAA rules allows passengers to bring approved portable oxygen concentrators on board airplanes.
• If you want to become a certified seafarer, be aware that the Coast Guard has updated the requirements.

For more data, go to TenThousandCommandments.com.