Editor’s Note: For information about proposed legislation to require enhanced federal regulatory anlaysis, including expanding cost-benefit analysis to all federal regulatory agencies, please, please see Chairman Brady’s Statement here. For information on the Congressional Review Act and the origin of CRE, see here.
Chairman Brady, Vice Chair Klobuchar and members of the Joint Economic Committee, thank you for the opportunity to testify about cutting red tape and improving the regulatory system through better analysis. The First Step to Cutting Red Tape: Better Analysis
The National Association of Manufacturers (NAM) is the nation’s largest industrial trade association and voice for more than 12 million men and women who make things in America. The NAM is committed to achieving a policy agenda that helps manufacturers grow and create jobs. Manufacturers very much appreciate your interest in and support of the manufacturing economy.
As Congress has a Congressional Budget Office (CBO) that is a parallel institution to the OMB, so too should it have a parallel to the Office of Information and Regulatory Affairs (OIRA) within the OMB.
The Administration promotes the benefits of conducting retrospective reviews. Executive Order 13563 directs agencies to conduct “retrospective analysis of rules that may be outmoded, ineffective, insufficient or excessively burdensome, and to modify, streamline, expand or repeal them in accordance with what has been learned.” Retrospective review of regulations is not a new concept, and there have been similar initiatives over the past 35 years. In 2005, the OMB, through OIRA, issued a report, titled Regulatory Reform of the U.S. Manufacturing Sector. That initiative identified 76 specific regulations that federal agencies and the OMB determined were in need of reform. In fact, the NAM submitted 26 of the regulations characterized as most in need of reform. Unfortunately, like previous reform initiatives, the 2005 initiative failed to live up to expectations, and despite efforts by federal agencies to cooperate with stakeholders, the promise of a significant burden reduction through the review of existing regulations never materialized.
There are several legislative proposals in this Congress that seek to improve the retrospective review process. Chairman Brady’s bill and Sen. Coats’ companion legislation–H.R. 3863 and S. 2099–would require reviews of existing rules to ensure they are meeting regulatory objectives effectively. Vice Chair Klobuchar’s bill–S. 1472–would require a new division within the CBO to analyze economically significant regulations that have been in effect for five years to determine if they are meeting the stated goals they were intended to provide. Sen. Angus King (I-ME) has introduced the Regulatory Improvement Act of 2013 (S. 1390), which would establish a bicameral and bipartisan Regulatory Improvement Commission to review outdated regulations and submit regulatory changes to Congress for an up-or-down vote. There is significant bipartisan interest in implementing federal policies that will tackle the problem of regulations that place unnecessary costs on manufacturers and businesses, yet are not benefitting society.