From: Regulatory Focus

By Alexander Gaffney, RF News Editor

What’s next for the White House’s Office of Information and Regulatory Affairs (OIRA)?

The agency, a sub-agency of the Office of Management and Budget (OMB), is sometimes referred to as the regulator of regulators; the agency charged with reviewing regulations promulgated by other agencies to ensure they meet federal guidelines and are generally cost-effective and minimally burdensome.

That mission has made it the bane of more than a few regulatory agencies, including the US Food and Drug Administration (FDA), which has recently seen several of its regulations—from Unique Device Identifier (UDI) rules to ones covering standards for laser products—delayed for months or even longer.

A Leadership Vacuum

But OIRA is now in a state of transition. Its most recent administrator, Cass Sunstein, left in August after serving in the Obama administration since shortly after the president’s inauguration. Despite Sunstein’s high-profile reputation, he won few accolades from Republican legislators, who at various times accused him of presiding over an “explosion” of new regulations and executive policies.

Whatever the merits of their argument, the legislators could have a lot to say in the selection and appointment of Sunstein’s replacement, who must be confirmed by the Senate. While the office is currently overseen on a temporary basis by Acting Administrator Boris Bershteyn, OMB’s former deputy general counsel, there are a number of indications that legislators would rather see the agency without a leader.

Perhaps the most prominent of those indications, as identified in a Bloomberg opinion piece by Sunstein, was that legislators experienced significant trouble getting Jack Lew, now the President’s chief of staff, confirmed to the position of head of OMB as recently as 2010.

Lew, who served as head of OMB under the Clinton administration and later became the chief operating officer of one of financial giant Citigroup’s investment units, hardly seemed like a controversial choice for the position. But, observed Sunstein, the vote of just a single senator to place a hold on a confirmation can leave an appointee in a state of limbo for months or even years. In the case of Lew, that hold came by way of Louisiana Sen. Mary Landrieu (D-LA), reportedly peeved about the Obama administration’s offshore oil drilling moratorium.

Though Democrats now hold control of the Senate, they lack the overwhelming majority they had during the start of Obama’s first term in office, potentially complicating the confirmation process further. And, as Landrieu shows, the party can’t always count on the support of its own members.

A Controversial Position

Another problem: The president’s progressive allies had been less than enamored with Sunstein, whom they believed placed too great an emphasis on the costs of regulations rather than on their results.

“What are some of the first signs we’ll look for to determine which way the President is headed in the second term? Look for who the President appoints to head the Office of Information and Regulatory Affairs, the little office that has regularly served as a killing ground for rules proposed by federal agencies, in Republican and Democratic administrations alike,” wrote Rena Steinzor, president of the Center for Progressive Reform (CPR), an advocacy group in favor of stronger health and environmental regulations.

Continued Steinzor, “The office needs to stop seeing itself as the defender of regulated industries, and the back channel through which politicos in the White House supplant agency expertise with cold, hard politics.  The President should appoint an OIRA Administrator with a strong background in environmental and health protections, and a record of concern for the public’s interest.”

“The intense focus on regulations during the past four years means that there will be even more scrutiny than usual when the president chooses someone to replace Sunstein,” observed CQ Roll Call in a piece published on 17 November.

Economic Scrutiny

That scrutiny is likely to be tied closely to the health of the economy. Though Obama maintained that Sunstein has succeeded in showing “that it is possible to support economic growth without sacrificing health, safety and the environment,” a number of conservative-leaning think tanks and business groups have at times fired back at that assertion.

“Cost estimates also require, but do not, account for how regulation undermines emergence of superior non-governmental institutions and disciplines (insurance, liability) that serve the public better,” wrote the Competitive Enterprise Institute’s (CEI) Clyde Wayne Crews in an opinion piece in March 2012. “If the market is muscled out, that is a cost and a dilution of real regulatory discipline.”

CEI, along with the Mercatus Center and various business groups, have also argued that OIRA over-stated the benefits of regulations with little justification, often times harming the economy’s ability to grow.

In the face of such opposition, Bershteyn could occupy the position for quite some time. CQ Roll Call notes he is a political appointee—formerly an associate White House counsel—and not a career employee. With one of its former lawyers heading the agency, the Obama administration may be less pressed to spend time and political capital fighting a lengthy and arduous confirmation battle so long as it continues to find Bershteyn easy to work with.