Time to shine more light on regulators’ ‘shadow boxes’

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Accompanying presidential executive orders and memoranda are the numerous sub-regulatory proclamations of departments and agencies we like to call “regulatory dark matter.” Occasionally we tally these documents. After the Trump era, we can point to over 100,000 of them.

Guidance documents tend not to appear in the Federal Register at all. Without awaiting a law or shepherding a notice-and-comment regulation through the Register, agencies can sometimes signal expectations, specify parameters, and influence a huge number of sectors in the economy. These include health care, retirement, education, energy production, finance, land and resource management, science, and manufacturing.

At times it’s interesting to highlight a few of these guidance documents. Back in the “Mapping Washington’s Lawlessness,” report I did just that, creating a “Shadow Box” table noting prominent examples from different departments and agencies (see the gray box on pp. 23-28).  

A prominent Obama-era proclamation noted in that report was the Internal Revenue Service’s granting of waivers of the Patient Protection and Affordable Care Act’s employer mandate in defiance of statutory language. Many know of Joe Biden’s aggressive student loan forgiveness efforts. Fewer know of the Department of Education’s quiet change of related eligibility rules via a website tweak.

Developments seem significant enough that I created a data-dump file that I’ll compile into a new “Shadow Box” soon. Some other guidance documents that legislators should be aware include the Federal Trade Commission’s guidance on disclosures for social media influencers, and that same agency’s “Policy Statement Regarding the Scope of Unfair Methods of Competition Under Section 5 of the Federal Trade Commission Act.”

The latter is a doozie. The Department of Transportation in 2022 issued a copycat version of the FTC directive called “Guidance Regarding Interpretation of Unfair and Deceptive Practices.” Also 2022 saw the State Department, with 60 global partners, launching the “Declaration for the Future of the Internet.” You might not have been consulted, but there you go.

Similarly ambitious is the White House Office of Science and Technology Policy’s “Blueprint for an AI Bill of Rights: Making Automated Systems Work for the American People.”

The original bill of rights was passed to restrain government. This one functions as prescriptive guidance, noting that “Designers, developers, and deployers of automated systems should take proactive and continuous measures to protect individuals and communities from algorithmic discrimination and to use and design systems in an equitable way.” (One objection here is that federal AI policy is not eliminating bias, but baking in a progressive version of it.)

Post-CARES Act eviction moratoria extensions by both the Trump and Biden administrations were prominent developments in guidance document adventurism. We find other less attention-getting but still noteworthy developments like the “Notice of federal guidelines” from the National Highway Traffic Safety Administration on “Cybersecurity Best Practices for the Safety of Modern Vehicles.”

One might consider such unsolicited advice suspect and presumptive given circumstances like January 2023’s Federal Aviation Administration ground-stop of air travel due to a “damaged database file with no evidence of a cyberattack,” and pipeline disruptions of east coast fuel service during a May 2021 ransomware attack despite a pre-existing dedicated Department of Energy “Emergency Response Organization.”

Biden’s infamous federally directed Electric Vehicle (EV) charging networks are set to join drone airspace management as new frontiers significantly governed by guidance rather than competitive enterprise. Washington also seems bent on pursuit of government-run payment systems and a central bank digital currency, and  digital IDs. Here, regulators might dispense with writing guidance down altogether and simply carry out their wishes remotely, as heralded in the bipartisan infrastructure law’s requirement for future “passive monitoring” of vehicles.   

Those are just a handful of specific examples. There are more that I will showcase later alongside updating a “portal” inventory of regulatory dark matter. These ambitious federal agency proclamations, memoranda, notices, letters, bulletins and more come atop the traditional rules and regulations that already receive insufficient disclosure and cost assessment. Recent increases in spending and regulatory interventions are apt to materialize not only in rulemaking but also in new waves of guidance documents. These interventions need to be made more transparent.

“Shadow Box” inventories featuring prominent guidance documents are one way we’ll continue to shine a little light on things until Congress steps in and does the job.