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Congress Is Causing Rising Regulatory Burdens. That Needs Fixing

By News Creatives Authors , in Business , at January 1, 1970

Mid-terms are approaching, and that means market-oriented policy groups, classical liberals, libertarians and others will resume the tradition of dusting off, polishing and updating optimistic reform ideas for the 118th Congress to crack down on federal spending and over-regulation. Ditto for non-market oriented groups.

To the extent Congress listens on regulatory reforms aimed at restraint, it would be helpful in its deliberations to not fully lay the blame for the centralization of power on agency overreach alone.

The reform-minded in Congress will need to address the multiplicity of “Whole-of-Government” spending and regulatory crusades Joe Biden has launched (”WOG” is Biden’s term; it appears to trace back to former U.K. Prime Minister Tony Blair). There are separate Biden WOG campaigns on “Equity,” “Climate Crisis,” “Competition Policy,” “Long covid,” and even on “ensuring responsible development for digital assets.”

But Congress must also acknowledge that the ambitions of this new administrative “meddle class” are rooted in Congress’s own delegation of its unique and hallowed lawmaking authority to the executive branch and agency personnel over whom voters exercise no control.

How much delegation? In calendar year 2021, the 117th Congress passed and Joe Biden signed 143 bills into law, while regulatory agencies issued 3,257 final rules.

But the creating of a sprawling administrative state that issues far more laws than Congress itself is not even the main issue. Of greater concern than delegation is the assumption of excessive or even illegitmate legislative powers as such. That is, if there are powers of compulsion we voters do not wield over our countrymen, then surely we cannot properly hand those off to our representatives. Insult is added to injury when Congress delegates authority to adminstrators and in turn (whether intended or not) feeds ambitions of an administration claiming it can do things “without Congress.”

Ignoring that tenet of restraint has increasingly meant the passage of laws having nothing to do with the protection of the rights and freedoms that formed the impetus for establishing this particular government in the first place. Many laws are increasingly interventionist highly regulatory, and accelerate the displacement of private sector preeminence and voluntary civil society in alarming ways.

The latest instances of this problem are big ones. The Bipartisan Innovation Act—passed by both Houses and now in conference negotiations—and the recently enacted Bipartisan Infrastructure Law will cost hundreds of billions of dollars in a nation already $30 trillion debt. Over the past weeks, Joe Biden has set out upon a string of nationwide roadshow appearances to promote both in service of his “building a better America” agenda, which includes the American Rescue Plan for which only Democrats voted. Yesterday (Monday the 9th) found Biden in the Rose Garden promoting the spend-y rural broadband “Affordable Connectivity Program” component of the BIL behemoth.

Such subsidies are not known for lowering costs and debt; but today finds Biden contrasting himself with what he calls “Ultra-MAGA” and speaking against the inflation many blame at least in part on the spendthrift policies of the very government he heads.

The programs to be spawned in the infrastructure and innovation spending laws will in turn birth mountains of rules, procurement and application nightmares, FAQs, directives and other guidance documents. Future Congresses will blame agencies for the counterproductive spending, regulation, centralization, stagnation and ossification the BIA and BIL will have caused. Repeatedly calling himself a “capitalist,” Biden steers and dilutes capitalism with heavy-handed central funding and planning at best, and replacement at worst. Calling itself bipartisanship, this is a collusion destined to bequeath to future generations the equivalent of today’s lead pipe contamination outbreaks and sewer systems unable to handle “flushable” diaper wipes.

Executive overreaches like Biden’s collection of WOG conceits are a real thing, but at root, the actions of Congresses of yesteryear and today are what have enabled Biden’s amplified reincarnation of the Obama “pen and phone.” Biden frequently invokes one or another decades-old law to rationalize new centralizations of power and regulation. He did it with his (now court overruled) vaccine and testing mandates by invoking the 50-year-old Occupational Safety and Health Act; he recently rediscovered the Buy American Act of 1933 to help promote the procurement controls embedded in the infrastructure and innovation initiatives, as well as in his own “Climate” and “Equity” campaigns. Ongoing Covid interventions and emergency declarations more broadly trace back to the Korean War era Defense Production Act and beyond. Biden’s whole-of-government “Equity” agenda invokes the carrots and sticks of civil rights, contracting and procurement laws. While Biden hasn’t (yet) thanked Nixon for the presence of an Environmental Protection Agency to anchor the whole-of-government pursuit of his “climate crisis” agenda (replete with green subsidies and denial of access to domestic energy resouces) don’t rule it out. The 20 year old Department of Homeland Security’s latest offspring under Biden is a new censorious “Disinformation Governance Board.” Alarming as the DGB is, the Bush administration nurtured the arrogant homeland-security state that hounds us today with trial balloons like the Pentagon’s Total Information Awareness project. That bipartisan pedigree may be why the administration unselfconsciously deems the DGB “a continuation of work that was done under the prior [Trump] administration” to an unquestioning media.

One can readily point to immense “national plan”-style legislative revolutions that have influenced the evolution of the economy far more profoundly than “mere” delegated and derivative regulatory power and decrees. These range from the Sherman Antitrust Act and national banking in the 19th century to New Deal policies during the 20th. Twenty-first century Congresses, not to be outdone even before the serious business of the BIA and BIL under Mr. Biden, produced the Sarbanes-Oxley and Dodd-Frank financial laws spawning thousands of pages of rules and, of course, the Patient Protection and Affordable Care Act to govern the nearly 20 percnt of GDP that goes to healh care. The aim here is not to present a complete inventory, so we’ll wrap up noting the transformational expansions of the federal enterprise entailed in the pandemic-era Families First Coronavirus Response Act, the CARES Act (Coronavirus Aid, Relief, and Economic Security Act), and Biden’s American Rescue Plan. These reverberate and will be the subjects of books and studies for years to come.

The point is, Congress lit the fuse and carried out all these extensions of power. Congress, not the agencies, is the First Cause of the regulatory big bang, while the agencies later fill the preordained, preapproved and limitless space of the expanding bureaucratic universe. Among these prime-mover acts are ones we had no right to impose on one another, nor in turn to authorize legislator to perform. The derivative delegations that accompany and follow pale in comparison to these initial deeds.

This all matters when contemplating regulatory reforms or administrative state reforms, which tend to be agency-focused. The ill-advised statutes created by Congress, often with bipartisan zeal, propel regulation and guidance documents and need pruning even more than regulation does.

One may often hear talk of regulations and and the need for routine review and purging by, for example, assembling packages of regulations to eliminate via an up-or-down vote (a process derived from the Base Closure and Realignment Commission). Legislation for such is periodically introduced, the latest being Sen. Mike Lee’s (R-Utah) LIBERATE Act. Moves like this are increasingly important given Biden’s perhaps permanently weakening of the Office of Management and Budget’s regulatory oversight function in favor of using that office to pursue regulatory benefits as defined by progressive policymakers and academics. Ostensibly sub-regulatory “guidance documents” and other forms of regulatory dark matter are stacking up unsupervised since Biden also removed Trump’s oversight of these. Indeed, since a torrent of guidance is destined to emerge post-BIL and -BIA, emergency legislation to cope is in order.

To secure worthy results given their current position of being stuck in a progressive ditch, regulatory reformers need to focus on Congress and its incentives instead of “mere” agency process reforms that emphasize technocratic minutiae like cost-benefit balancing acts that rarely materialize. Over the years, many worthy regulatory reform proposals have been offered which now—given fresh contrasting experiences like Trump’s unique but imperfect attempt at regulatory streamlining on the one hand and Biden’s scornful overthrow of it on the other—can be adapted to reflect revelations that counsel more aggressive restraints including congressional authorization of regulations. Prominent among these revelations is that the executive branch (thanks to the tentacles given it by Congress) can unilaterally grow the central government, but is unable to shrink it. That a president may no longer be able to ditch the executive orders of a predecessor—as occurred with respect to the Obama era Department of Homeland Security’s Supreme Court-validated unilateral action on Deferred Action for Childhood Arrivals (or DACA)—remains an insufficiently examined seismic shift that must influence the regulatory reform agendas future Congresses adopt. Trump’s deregulatory orders, by contrast, got the chopping block.

Along with the purging of old and nettlesome rules and nation-reconfiguring laws, worthy reforms include advancing agency regulatory disclosures and prioritizing congressional accountability. On the agency front, these rehabilitations would entail “regulatory report cards” mirroring fiscal budget reporting formality that incorporate guidance documents in addition to rules, as well as lowering thresholds at which rule (and guidance documents) qualify as “significant” enough to trigger deep scrutiny by overseers. Other assorted ideas include freezes, moratoria, expiration dates on rules, and regulatory cost budgets to create pressures for a regulatory compliance cost ceiling (that one can only hope would prove more of a constraint than the fiscal debt ceiling).

Given that Congress routinely turns to the Congressional Budget Office for fiscal and budgetary analysis, some have proposed that an office of regulatory analysis be erected to examine rules in detail. A version of that was proposed a decade ago by former Rep. Don Young (R-AK), who passed away in March of this year. An “Office of No” would be an even stronger institution of restraint, chartered exclusively with highlighting the superiority of market-oriented or liberalization alternatives over command options for each regulatory initiative and intervention. This bias would stand in formalized contrast to the entirety of the existing administrative apparatus, and continually question framings like “public goods” and steadily present the case for eliminating existing rules and replacement of them with superior competitive disciplines. It’s findings and presense could also temper legislative passions.

Alongside these proposals (many others could be noted), tough action is necessary to end the predatory “transformative” lawmaking compusion and to prevent today’s rampant abuse of crisis to expand permanent federal power. Crisis abuse is what the nation got in the aftermath of 9/11, the financial meltdown of 2008 and the pandemic. In each instance there are predators reluctant to “let crisis go to waste” and who seize the “opportunity,” so to speak, to expand government and advance the ends of political progressives like themselves. An Abuse-of-Crisis Prevention Act, of which regulatory liberalizaton and a “liberate to stimulate” agenda would be a component, is needed to discipline political predation. Other vital components of stopping the “Transformers” entail drastically slashing the scope, size and spending ambitions of the federal enterprise (so, no more “whole-of-government” inteventionism); restoring most (legitimate and limited) powers to citizens and local and state authorities; and strengthening the private sector’s capacity to expand intergenerational wealth and keep it firewalled forevermore from Washington and its opposite vision of expanding intergenerational debt.

Over the years, heated debates over term limits (should Pelosi be making laws for non-San Franciscans who have never had an opportunity to vote on her presence for over 35 years?) or requiring members of Congress to comply with the laws they pass indicate that not all institutional reforms are created equal. Ultimately, on the regulatory front, voters do not command the bureaucrats and so need the ability to hold Congress directly accountable by requiring Members’ direct approval of new rules and significant guidance. The Regulations from the Executive In Need of Scrutiny (REINS) Act, perpetually introduced and existing in some form for decades but never passed, will likely reappear in the 118th Congress. The 1990’s moniker of its progenitor, the “Congressional Responsibilty Act,” was more fitting.

Responsibility for rampant debt spending and over-regulation of the economy lies with a Congress that exercises too much power—but also with those of us who presume to hand, via “The Vote,” powers to representatives that we ourselves do not possess. Reformers should certainly target agency overreach, but they mustn’t get distracted by it, becuase Congress (and we ourselves) caused and enable the federal government we have.

If members of Congress can be made more answerable not solely for excessive regulation but also for the legislative excesses that are the parent of that regulatory abuse, we will have made important institutional changes that can play a role in the restoration of limited government and Article I of the Constitution itself.

This new agenda would be a true “whole-of-government” initiative, but one occupying the opposite philosophical pole from Biden’s abnormatilities. Unraveling the adminstrative state and restoring a constitutional republic will necessitate reforms that rectify not only the inappropriate Biden-style infusion of the executive branch with lawmaking power, but also the reckless exercise of lawmaking power by Congress itself.

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