Regulatory nominee warned about ‘burdensome’ rules
By DARIUS DIXON
Senate Republicans sought to drill a few messages into the head of the White House’s incoming regulatory czar Wednesday: Beware of “unintended consequences” and “burdensome” rules that hurt the economy.
Those messages were delivered at the nomination hearing for Howard Shelanski, President Barack Obama’s pick to lead the White House Office of Information and Regulatory Affairs, a position that is little known outside Washington but that plays a major role as a gatekeeper of new regulations.
Sen. Ron Johnson (R-Wis.) used the hearing before the Senate Homeland Security and Governmental Affairs Committee to swipe at the Environmental Protection Agency over new ozone proposals, and he urged Shelanski to keep new regulations in check. He also suggested that ever-tighter pollution standards were proposed in part because regulators had little else to do.
“These regulations are well-intended. I think all of government is well-intended. But as we continue to throw more and more government at problems, you do reach that point of diminishing returns,” Johnson said.
“I’ll throw one out there: ozone regulations,” he said. “We get it down to 75 parts [per billion] — I guess there must be an office of ozone regulation at EPA — and they must be sitting around their office going, ‘Well, now what do we do?’ I’m afraid the reaction is, ‘Let’s knock it down to 65 parts per [billion].’”
The White House delayed EPA’s ozone rules in 2011, but the agency is expected to propose whether to tighten the standard by the end of this year.
The hearing came a day after White House environment and energy adviser Heather Zichal said Obama would turn to executive actions — including EPA regulations — in a new effort to combat climate change.
“In the coming weeks and months, you can expect to hear more from the president on this issue, as well as on the agenda,” Zichal said at an environmental forum on Tuesday.
Shelanski was nominated in April to replace Obama’s regulatory enforcer and University of Chicago friend Cass Sunstein, who left the position last August. OIRA falls under the White House Office of Management and Budget, a key agency in the review of environmental and energy regulations.
Rules at agencies like EPA and Treasury go through OIRA, but independent government entities like the Nuclear Regulatory Commission aren’t subject to White House approval.
Oklahoma Sen. Tom Coburn, the top Republican on the Homeland Security panel, used Wednesday’s hearing to rip into EPA’s renewable fuels standard, which requires refineries to use ever-increasing amounts of ethanol or buy renewable fuel credits.
“We’re going to see … two refineries in Oklahoma close within a year, year-and-a-half, because they cannot afford to buy the renewable fuel credits,” Coburn said.
That problem could be fixed with “one adjustment” to the standard, Coburn said, which would alleviate his concern about the rising price of the credits without ending the ethanol mandate.
Still, he was careful to direct his frustration at EPA rather than Shelanski, whom he described as “an excellent candidate.”
Shelanski sought to mollify Coburn, giving a brief response about OIRA’s responsibility to consider alternative regulatory approaches and cost-benefit analyses.
Sen. Rob Portman (R-Ohio), an OMB director under President George W. Bush, aired his own concerns about costly government regulations and highlighted the importance of the OIRA job in comments directed to Shelanski’s family.
“I would say to your son, who’s here, your dad has been nominated for the most important job in Washington that nobody’s ever heard of,” he said. “It’s a job that is much more important than most people realize because it affects the economy in very fundamental ways.”
Democrats weren’t without their own concerns, mainly directed at the backlog of work at the office.
Sen. Carl Levin (D-Mich.) said the White House’s regulations office had created “chronic” delays for agencies looking implement rules.
Despite an executive order giving OIRA 90 days to review regulations, plus possible 30-day extensions, 51 rules were still hung up after more than a year, according to Levin.
The delays, he said, “fundamentally undermine the agencies’ abilities to effectively execute the responsibilities that those agencies have.”
For his part, Shelanski said he “absolutely” shared Levin’s concern about timeliness.
But the foot-dragging charge has dogged OIRA since Sunstein started slow-walking regulations, according to a POLITICO review last year of government data and dozens of interviews with current and former administration officials, lawmakers in both parties, business leaders and liberal activists.
Consumer group Public Citizen on Wednesday attacked OIRA for “routinely” missing deadlines and said its average review time is now more than double what it was under President George W. Bush.
“A small but powerful White House agency that reviews proposed regulations has consistently taken an anti-regulatory posture over the past few years, but the full scope of the impact of that stance cannot be discerned because the agency is shrouded in secrecy,” Public Citizen said in a news release unveiling the group’s report on OIRA.
Shelanski has a long résumé, including a stint as director of the Bureau of Economics at the Federal Trade Commission while on leave from Georgetown University Law Center. He also spent more than a decade in academia at the University of California Berkeley, served as chief economist of the Federal Communications Commission and a senior economist for the President’s Council of Economic Advisers in the Clinton White House.