In National Review this week, Wayne Crews and I make the case for including regulatory reform in a debt ceiling package. "Any hike in borrowing authority should be conditioned on passage of major elements of bills pending in Congress to reform the regulatory process," we argue. "The GOP should give the Obama administration the chance to back up at least some of its rhetoric on overregulation."
It has now come to my attention that there is a precedent for including reg relief measures in a debt ceiling bill. In 1996, after months of deadlocking on budget negotiations that resulted in a government shutdown and a six-month delay in hiking the debt ceiling -- at that time the shutdown took precedence in the headlines over the debt ceiling breach -- the GOP Congress passed the Contract with America Advancement Act of 1996 that was signed by President Clinton.
This law included a hike in the debt ceiling to $5.5 trillion (almost a third of what the debt ceiling is now -- ah, those were the days!), but it also included some GOP priorities. Among them was a subsection entitled the Small Business Regulatory Enforcement Fairness Act. Included in this measure were the Congressional Review Act to set up a procedure for blocking regulations by both houses of Congress and provisions to include more judicial review of agency actions to ensure regulations weren't overly burdensome to small business.
The changes the Crews and I proposed are essentially updates of these provisions. The REINS Act would go a step beyond congressional review and set up a process for affirmative congressional approval of regulations that cost the economy $100 million or more. This is more necessary than ever as the Obama administration issue more than 90 of these costly rules last year, smothering investment and job creation. And the Freedom Act of Sen. Olympia Snowe (R-Maine) would add teeth to the judicial review provisions by making it easier for small businesses to get their day in court to challenge Goliath government agencies.
By the way, an interesting point is that the debt ceiling was breached for half a year in the mid-90s, and there was no catastrophe to speak of. In fact, the second half of the '90s, as we are constantly reminded, produced record growth in jobs and GDP. Economist Veronique de Rugy of the Mercatus Center has written on how the Treasury Department avoided a debt default during the debt ceiling breach of 1995 and 1996. It's worth a read.