Warren's Bill Presents Progressive Vision for Rulemaking Reform

by James Goodwin

Originally published in The Regulatory Review. Reprinted with permission.

By even cost-benefit analysis — the most biased metric — regulations are improving America, producing benefits that exceed costs by a ratio of as much as 12-to-1, according to the most recent figures from the Trump Administration. Of course, those numbers barely scratch the surface of what regulations actually "do."

Thanks in part to the Clean Air Act, for example, the median concentration of lead in the blood of children between one and five years old decreased 93 percent between 1976 and 2012. The Endangered Species Act was instrumental in bringing the iconic bald eagle back from the brink of extinction. And the Occupational Safety and Health Administration's regulations helped reduce worker fatality rates from 18 deaths per 100,000 workers in 1970 to four deaths per 100,000 workers in 2006.

Given the enormous success of regulations, you would think that lawmakers — at least progressive ones — would be eager to extol their virtues and champion reforms to strengthen our regulatory system. But you would be wrong. Instead, apparently seduced by the conservative siren song that decries regulations as incompatible with job creation, economic growth, or even "freedom," progressive lawmakers have adopted a much meeker, almost apologetic tone.

Thankfully, U.S. Senator Elizabeth Warren (D-Mass.) has broken from this pattern with the release of the Anti-Corruption and Public Integrity Act. Her bill provides a comprehensive blueprint for ridding our federal institutions of excessive corporate influence while restoring the principle of government "of the people, by the people, and for the people." This entire blueprint is critical in this political era, but it is the bill's "Rulemaking Reform" part that is especially noteworthy. It lays the groundwork for a new, progressive vision of regulation — one that both affirms the intrinsic and instrumental values of a robust and responsive regulatory system and would strengthen its role as a vital and legitimate part of our democracy.

Implicit in the bill's regulatory provisions is the recognition that the implementation of regulatory safeguards represents a righteous example of democracy in action. Indeed, when agencies implement statutes that protect people and the environment, they are acting pursuant to a law passed by both chambers of Congress and signed by the President. These statutes in turn reflect the considered determination of these democratically elected officials that there is a problem of national import and that regulatory safeguards, developed after careful study by agency experts, are an appropriate response to that problem.

The regulations that emerge from this process are in one sense a technocratic response to the problems identified by our policymakers, but in another important sense, they are also one of the key means by which we as a society have given life to our collective values. We have rules against predatory lending because we think it is unfair for sophisticated companies to take advantage of their disproportionately greater power to cheat us out of our money. When it comes to air pollution, we use rules to make the companies that created the pollution bear the cost of cleaning it up — not the downwind communities that had no say in its creation and that would see no economic benefit from the activities that produced it.

The rulemaking process also exemplifies democracy in action because of the direct participatory opportunities it offers ordinary Americans to contribute to substantive outcomes of individual rules. Under the Administrative Procedure Act and, in some cases, authorizing statutes, agencies must offer all of us a chance to weigh in on and offer edits to the rough drafts of their regulatory actions — through a process known as notice-and-comment rulemaking. As an agency works to revise a proposed rule into a final rule, it must demonstrate that it actually considered any legitimate points that were raised by the public. The courts stand ready to hold agencies accountable for abiding by this commitment. Moreover, by effectively making the public "co-authors" of agency regulations in this way, the notice-and-comment process also imbues regulatory outcomes with a deep and meaningful level of legitimacy.

Senator Warren's bill recognizes the importance of democracy in rulemaking. Indeed, she amplifies democracy by including several provisions that aim to promote greater participation in the rulemaking process by ordinary Americans. For example, Section 309 of the bill would create an Office of Public Advocacy (OPA) to participate in rulemakings and otherwise assist individuals with dealing with regulatory agencies. In many rulemakings, nearly every step of the process is currently dominated by corporate interests. Regulated entities and their trade associations file far more rulemaking comments than individuals or groups representing people who would benefit from a proposed regulation. Likewise, the same imbalance exists in terms of lobbying at the White House Office of Information and Regulatory Affairs (OIRA), which often exerts considerable influence over the outcomes of rules. By helping ordinary Americans participate more effectively in rulemakings, the OPA would help to correct this imbalance.

Senator Warren's bill also recognizes that promoting public participation alone will not be enough. As long as corporate interests continue to dominate key steps of the rulemaking process, the public's voice remains at risk of being drowned out. Accordingly, several provisions in the bill are aimed at curbing the undue influence that corporate interests currently enjoy. For example, the bill contains several measures that would end OIRA's role as a conduit for such influence. Section 303 would promote transparency in OIRA's centralized review process by requiring rulemaking agencies to disclose any changes that were made to a draft rule while undergoing OIRA review and to identify the entity that suggested the change. Perhaps even more importantly, Section 306 would abolish OIRA's practice of holding meetings or otherwise communicating with individuals who are not employed by the executive branch about rules that are undergoing review.

The balanced participation that Senator Warren's bill seeks to promote will help to yield more just outcomes in regulatory decision-making — especially for members of historically disadvantaged communities. As it is, the unique perspectives these individuals can offer rarely, if ever, reach agency decision-makers. This can ultimately skew regulatory design in ways that leave these individuals systematically unprotected or under-protected against the harms that a rule is meant to address. This result is particularly pernicious, since the members of these communities may be the ones who bear a disproportionate burden from these harms compared to the rest of the country, not to mention the many other sources of structural inequality they might face. Moreover, any potential harmful and unintended consequences that a rule might impose on these communities are often left unidentified without participation from disadvantaged communities.

These provisions also hold the potential for helping restore the overall health of our democracy. More Americans are expressing cynicism about our governing institutions, justifiably feeling that our lawmakers are more concerned with helping political and economic elites than with working for their constituents. Decreasing public confidence is in turn contributing to a growing sense of disconnectedness between people and their government, a condition that risks doing long-lasting damage to the integrity of U.S. democracy.

Public participation in the rulemaking process can help citizens feel more connected to government by giving them a stronger stake in the outcome of policymaking and by providing them with another opportunity to make their voice heard beyond casting a periodic vote—two of the ancillary benefits of increasing democracy in the process.

Senator Warren's bill also comes at an important time when many progressive lawmakers are working to articulate a positive vision of the government's role in society. According to the vision that is slowly emerging, the U.S. government can and should empower citizens to work together to promote a fairer society. The government can do so by strengthening individuals' capacity to achieve their full potential as human beings and to continue to thrive even when confronted with one of life's unexpected setbacks.

This vision would be advanced by such measures as single-payer health care, universal higher education, and Senator Warren's other major bill aiming to reform corporate governance by making it more responsive to workers and consumers. For too long, progressives have lacked a coherent alternative to counter the neoliberal vision of government that essentially reduces U.S. democracy to a servile adjunct of the free market, leaving these lawmakers at a distinct disadvantage in current policy debates.

To this point, what has been conspicuously absent from the progressive positive vision of government has been the regulatory system and the vital role the process can play in helping to bring about that vision. The rulemaking reform part of Senator Warren's bill would begin to fill this important gap.

To be sure, not all of the components of this part of the bill are perfect. For example, the efforts of Section 315 — to paper over the problems of cost-benefit analysis by directing agencies to better account for regulatory benefits, including those that are unquantifiable—are admirable but fundamentally misguided. Instead, a truly progressive vision of regulation needs to recognize that cost-benefit analysis serves to reinforce the neoliberal vision of government and is thus fundamentally inconsistent with its goals. Nevertheless, these and other details can be worked out through ongoing consideration and debate among Americans about their values and how the regulatory system should be improved to advance those values.

These conversations have long been overdue. Whatever else Senator Warren's bill is able to accomplish in the long run, it will be immensely valuable if it pushes progressives and others to stake out broader and bolder views on these critical issues of law and policy.



© 2016 The Center for Progressive Reform