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The other side of Congress' anti-regulation claims

This week, Congress continued its attacks on the federal agencies responsible for safeguarding our nation’s health and safety. The House held 12 hearings that served as little more than opportunities for Republican politicians and industry witnesses to bemoan proposed environmental protections (“Hearing on Environmental Regulation, the Economy, and Jobs“), efforts to reduce lead-tainted toys and alert consumers of dangerous products (“Review of CPSIA and CPSC Resources“), and attempts to allow internet innovators and start-up web companies to succeed (“Network Neutrality and Internet Regulation: Warranted or More Economic Harm than Good?“).

Congress is in recess next week, so the Hill’s stagecraft will have an intermission. We urge members of Congress to spend some time rethinking some of the statements they’ve been making and have heard. Here are some suggestions:

  • When considering the costs of something, also consider the benefits. This has been a repeated problem, from the Small Business Administration-commissioned and often-cited Crain and Crain report that makes an outrageous claim about the costs of regulations without ever discussing the benefits, to the extremely one-sided House rule instructing committees to examine all the ways that regulations impede, harm, and fail without asking how they stimulate, improve, and strengthen. As we’ve noted before, the Office of Management and Budget provides annual reports to Congress on the costs and benefits of major regulations. These reports routinely show benefits outweighing costs by a factor ranging from 2 to 1 up to 14 to 1, that is, for every dollar spent on a regulation, two to fourteen dollars are generated. To ignore these numbers when discussing regulations is dishonest and irresponsible.
  • It is much harder to quantify the monetary benefits of regulations than the costs. Think about it, the “costs” of regulation usually already have a price tag: buying safety harnesses, installing emissions control systems, sending toys to a lab to be tested for lead content. These are easily quantifiable, albeit probably inflated. Benefits, on the other hand, are much trickier to put into a dollar amount. Consider many of the benefits created by regulations: safer food, cleaner air, children whose developments aren’t stunted by exposure to lead, and so on. These are challenging things to quantify. This week, the New York Times had an article discussing the difficulties that agencies face when they try to put a dollar amount on the value of a human life. This difficulty is one of the big problems with cost-benefit analysis, as Public Citizen President Rob Weissman explains in the Times article.
  • Regulations can create jobs. Clean air rules issued by the EPA would generate 1.5 million jobs over the next five years, according to a recent study. The founder of Seventh Generation products recently wrote “I’ve started three companies, generated thousands of jobs, created hundreds of millions of dollars of shareholder value as an entrepreneur since I was 19, and I’ve never felt restrained by government regulation!” Regulations also help avoid repeats of the industry-wide depressions that occurred during the food and children’s products recalls that occurred over the last few years. Many of these rules will lead to innovation and job creation as industries adapt to make safer products, reduce their pollution emissions, and improve the safety of their workplaces. The safety and compliance of businesses will be aided and ensured by agencies that have the resources to hire inspectors, trainers, and other compliance personnel, which leads to the final point.
  • Government jobs still count as jobs. When a reporter pointed out to House Speaker John Boehner that his party’s proposed funding cuts would likely lead to layoffs for federal employees, Boehner responded, “If some of those jobs are lost so be it.” This provoked a strong reaction, but it was just the most recent implication that government employees aren’t working real jobs. The “unelected bureaucrats” that politicians love to malign are scientists, accountants, doctors, lawyers, economists, and other experts who are working to protect our nation’s health and welfare. The work they do is real and important, and politicians who denigrate these employees should be ashamed of themselves.

If Congress wants to have a real debate about the role of agencies, its members should heed these points. It is too easy to simply regurgitate talking points provided by a trade group in an effort to win the next election. But workers are still dying on the job, companies are still polluting the air, and businesses are still taking advantage of consumers. As we wrote to House Oversight Committee Chairman Darrell Issa last month:

Your role in overseeing administrative agencies should be to identify and help remedy not just ineffectiveness but inadequacy. We urge you to consider questions such as: What additional powers do agencies need to protect Americans’ health and safety? Are the penalties for noncompliance with safety regulations effective at deterring dangerous behavior? If there were a disaster, would the responsible agency have the necessary staff and resources to respond quickly and effectively?

We have not seen these questions asked yet, but we hope that when Congress returns from its recess, it approaches its role more thoughtfully.