ROB PORTMAN
Regulatory relief is what we need now

September 21st, 2012    Author: Administrator    Filed Under: Opinion

As I meet with small business owners across Ohio, I hear a familiar refrain about federal regulations.

These are the binding decisions executive agencies make as they implement the statutes Congress passed and the president signed into law. Regulations have the full force of law, even though they are written by agencies and not elected representatives.

Many of the employers I talk to say the regulations coming out of Washington under President Obama are too costly, or are not providing the certainty their businesses need in order to expand and hire fellow Ohioans who are out of work.

There’s plenty of evidence to support Gallup’s finding last year that overregulation now tops the list of “most important problems” holding back small businesses.

First, the number of costly regulations is unusually high lately. In its first three years, the Obama administration issued more regulations costing $100 million or more than any administration since these records were kept. It issued 20 percent more than the Clinton administration and 40 percent more than the Bush administration.

Second, the administration has not provided small business owners with certainty. If employers are not told what is in Washington’s pipeline, they won’t know how to plan for the future, including whether they’ll be able to afford new hires.

That’s why I wrote to President Obama two weeks ago, asking why his administration did not produce a required biannual review of its regulatory agenda to give employers and others notice of new regulations under development. Federal law and executive orders by presidents of both parties require publication of a forecast of new rules coming down the pike, but this administration has ignored the requirement this year.

Better transparency and more certainty would help, but they are only part of the solution. I believe comprehensive regulatory reform is necessary. And I have introduced two proactive, bipartisan bills to help provide it.

When it comes to the cost issue, one problem is that the federal government doesn’t budget for the costs these regulations impose on American employers as well as the American consumer. Unlike the process for government spending or taxes, Congress doesn’t even have to approve new regulatory burdens, including those costing billions of dollars per year.

For example, the Environmental Protection Agency is imposing regulations on the energy industry that are contributing to the early closure of eight coal-fired power plants across Ohio.

While environmentalists have cheered the closures as a victory for their cause, the local communities where these facilities are located are bracing for the hundreds of workers who will be laid off and the millions of dollars in lost tax revenue.

Statewide, this will likely drive up electricity prices for consumers and degrade the reliability of the grid, especially during peak use in the height of summer and the dead of winter. After the intense heat wave we experienced this summer in Ohio, can you imagine enduring these temperatures with an even less reliable grid?

The first bill, the Regulatory Accountability Act, tackles this issue by greatly strengthening the requirement for agencies to scrutinize the costs and benefits of new regulations, including looking at what they will do to create or harm jobs.

Agencies will also have to implement what’s called the “least burdensome” option. The bill also opens the regulatory process to greater transparency at virtually every stage, by inviting early public participation on high-dollar rules and requiring agencies to disclose the data they are relying on.

Finally, regulations that will cost more than $1 billion will be subjected to even greater scrutiny. If you can believe it, there are at least seven such rules on their way, according to the administration.

To provide greater certainty for job creators, the second bill, the Independent Agency Regulatory Analysis Act, makes sure that what are termed “independent agencies” are also required to use cost-benefit analysis. These include the Securities and Exchange Commission, National Labor Relations Board, and Federal Communications Commission — powerful regulators with command over the nation’s economy.

Giving independent agencies the same responsibilities as other government agencies is a no-brainer that has long been overdue. The evidence bears out the need. In 2011, independent agencies finalized 17 major rules – and not a single one of them was subjected to a complete cost-benefit analysis. The tallies for earlier years are similarly lopsided.

It’s far past time for Washington to stop running up the score. Ohio employers and workers desperately need a more job-friendly regulatory climate. With meaningful regulatory relief, Congress can help pave the way to a true American economic comeback.

Rob Portman is a United States Senator from Ohio.

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