Reg Reformers Learn To Crawl Before They Walk

Guest Editorial by H. Sterling Burnett
Copyright 1998 Investor's Business Daily, Inc.
Investor's Business Daily (February 13, 1998)

Like the proverbial "journey of a thousand miles," regulatory reform begins with a single step. After several recent stumbles, Congress is taking the first small step to rein in the rulemakers.

In their rush to make the country risk-free, federal regulators have often failed to see - and in some cases have ignored - the damage their rules can do. When the government ordered automakers to install passenger-side air bags, regulators forgot to mention that the devices were potentially deadly to infants, toddlers and short adults. Children died.

In response to the air-bag outrage and similar cases of safety rules proving hazardous to people's health, Sens. Carl Levin, D- Mich., and Fred Thompson, R-Tenn., have introduced the Regulatory Improvement Act of '97.

The 104th Congress proposed fairly substantial regulatory reforms, only to find its efforts decried as "paying polluters not to pollute" and "placing profits ahead of children's lives." Such charges were nonsense, of course, but they derailed reform efforts.

Thompson's and Levin's bill is more modest. It tries to put the brakes on overzealous regulation by forcing bureaucrats to think about the unintended consequences of their rules.

Thousands of costly, ineffective and harmful federal regulations sprout like weeds every year. The Federal Register grew by 70,000 pages in '94 alone. Economists say that complying with these rules costs an average of more than $6,000 per household a year - in higher prices for goods and services and wasted time and resources on paperwork. That's money that otherwise could be spent on heath, education or retirement.

Of course, if a rule protects human health or prevents environmental degradation, the costs might be justified. Unfortunately, regulators often overlook the hidden costs of their rules, especially in terms of human lives.

For example, shaving weight off new cars to meet mandatory fuel economy standards has caused an additional 2,200 to 3,900 highway deaths a year, a Harvard University-Brookings Institution study found. Other researchers say that new ozone rules could result in 7,000 deaths a year.

The Thompson-Levin bill is the first step to minimizing loss of life from ill-considered regulations. If passed, the law would ensure that rules are made only after all relevent information is gathered and publicly disclosed.

The bill says that reasons for new regulations must be clear and justified. First, it says that all citizens have a right to know what certain regulations are supposed to do. It would also require new mandates to undergo a cost-benefit analysis.

Second, the ThompsonLevin bill says that if regulatory agencies don't use the least costly methods to fix health, safety and environmental problems, the public has a right to know why.

The bill also says the public has a right to know what the relative risks are that regulations are supposed to reduce and what scientific evidence the government has to back up the rules. That's meant to head off the kind of charges made against recent clean-air rules. Critics claimed that junk science was used to justify costly regulations and that data that refuted the need for new mandates were suppressed.

John Graham, director of the Harvard University School of Public Health's Center for Risk Analysis, ran a thorough risk-benefit analysis of several existing regulations.

Graham found that by allotting funds for health, safety and environmental regulations differently, the U.S. could save 60,000 additional lives a year. By requiring that sort of analysis, the Thompson-Levin bill hopes to avoid wasting more time and money combating trivial risks when substantial harms could be averted.

Regulatory reform is long overdue. But the regulatory state was not built in a day, and it's unlikely to be dismantled in two sessions of Congress, much less in one fell swoop. Though the Thompson-Levin bill is only a small first step, it's a step in the right direction.

H. Sterling Burnett is an environmental policy analyst with the National Center for Policy Analysis in Dallas.

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