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REGULATIONS: Sunstein vows to spike bad agency rules  (Thursday, September 22, 2011)

Gabriel Nelson, E&E reporter

The Obama administration has recently pulled several new regulations that were seen as doing harm to businesses and that trend will continue if agencies don't write rules that follow the president's orders, White House regulatory chief Cass Sunstein told lawmakers yesterday.

U.S. EPA recently withdrew a rule, criticized by the National Association of Homebuilders, that was meant to limit pollution in stormwater runoff from construction sites, Sunstein told members of the House Small Business Committee. Other rules that dealt with workplace noise and musculoskeletal disorders were yanked by the Department of Labor after business groups objected.

All together, there have been 34 rules withdrawn by the White House and three returned to agencies this year, records made available by the White House show. And the overseers of the rulemaking process will remain vigilant with 219 rules in the pipeline that qualify as "economically significant," meaning they would cost the economy more than $100 million or have a major effect in some other way, Sunstein said.

"I can assure you: Those 219 aren't going to see the light of day unless they can pass very careful scrutiny, in terms of the new direction the president has given us this year," he said.

Sunstein did not mention the most notable example of the change of course by the White House: a decision, announced at the beginning of this month to hold off until 2013 on an update to the national air quality standards for smog.

That move came as President Obama is under pressure from Republicans and business groups over regulations from EPA, as well as rules being written to implement new health care and banking laws. And while critics have been skeptical that Obama would change the rulemaking process after he issued an executive order this January that stressed the need to make regulations more cost-effective, the president is not just blowing smoke, Sunstein told lawmakers.

"If there are other areas where we aren't being sufficiently responsive, gosh, I'd love to hear it, because this is the time," he told lawmakers.

The White House has been barraged by demands from both sides at a time when the issue of regulation has become a partisan football. Democrats point to the economic crash as proof of the failure of deregulation, while Republicans blame new agency rules -- and the "uncertainty" they see following it -- for the economy's slow recovery.

"It is easy to make things bigger and more complex, but it takes a lot of courage and a touch of genius to move in the opposite direction, and I hope this administration has that courage," House Small Business Chairman Sam Graves (R-Mo.) said today.

Just this week, the liberal Economic Policy Institute released an analysis saying that complying with new EPA rules would take up about 0.1 percent of the nation's gross domestic product, making it a relatively small wave in a sea of economic pressures that is still roiling from the near-collapse of the housing market and financial system in late 2008.

The analysis was touted yesterday by EPA Administrator Lisa Jackson, who said in a Twitter message that it "proves we don't have to choose between a healthy environment and a strong economy."

But at yesterday's hearing, most of the arguments came from House Republicans such as North Carolina Rep. Renee Ellmers, who said businesses in her district tell her that new regulations are "killing us."

"I hear that every day -- not just on my birthday -- that regulations are causing problems," Sunstein replied. "'Killing us' is the strongest phrasing, but I've heard that a lot also. I'd say, if I hear that only once in a day, it's an unusual day."

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