While you’ll never hear it from NPR or the rest of the monoculture media, “rule of flaw” by federal agency bureaucracy can impede economic efficiency and undermine health, safety and environmental progress. It does this with top-down programs that propagate in sometimes costly ways throughout the economy and society.
The sole check for a federal government that regulates heavily on top of spending $6 trillion a year is a small office of regulatory affairs that resides at the White House Office of Management and Budget (OMB). But rather than serving as a blockade, even this body is headed by an acting administrator sympathetic to “promulgating new regulations to advance a progressive agenda.” That’s not the same as scrutinizing regulations that can impede growth and jobs.
One of the Biden administration’s very first actions was uprooting the Trump-era regulatory liberalization agenda and replacing it with a “Modernizing Regulatory Review” directive to agencies (to dispel any confusion, to “modernize” means to expand government). The new approach eases the exercise of unilateral regulatory power, in ways parallel to how — when asked about Biden’s priorities on climate — administration spokesperson Karine Jean-Pierre declared that “[W]e don’t need Congress. We can do it without Congress.”
Much as the public is similarly told that cost of Biden’s “Build Back Better” program consisting of “physical infrastructure and human infrastructure” is “zero,” regulatory modernization has done away with already largely nonexistent cost-benefit analysis by elevating unquantifiable and nebulous regulatory aims as benefits. In keeping, Biden’s memorandum to agencies declared: “Our Nation today faces serious challenges, including a massive global pandemic; a major economic downturn; systemic racial inequality; and the undeniable reality and accelerating threat of climate change.”
While climate change may be “undeniable,” regulatory costs more broadly are routinely “denied,” with the last strands of green-eyeshade oversight at OMB replaced with a presidential solicitation of “concrete suggestions on how the regulatory review process can promote public health and safety, economic growth, social welfare, racial justice, environmental stewardship, human dignity, equity, and the interests of future generations.” Lest there be any doubt about this new role for the one-time traffic-cop OMB, Biden specified that “The recommendations should also include proposals that would ensure that regulatory review serves as a tool to affirmatively promote regulations that advance these values.”
The memo further asks that the new architects “consider ways that OIRA [the Office of Information and Regulatory Affairs] can play a more proactive role in partnering with agencies to explore, promote, and undertake regulatory initiatives that are likely to yield significant benefits.”
As for OMB’s long-standing “Circular A-4” guidance on regulatory oversight, which already omits many categories of costs and was never a powerful regulatory impediment, Biden wants it modified to “ensure that the review process … fully accounts for regulatory benefits that are difficult or impossible to quantify, and does not have harmful anti-regulatory or deregulatory effects.” Deregulation—the very word—is thereby officially set aside.
The progressive policies increasingly enabled in the administrative state framework replace market operation and civil society with government in the coercive pursuit of a range of non-quantifiable goals, even without legislation from Congress. Recalling anew the “pen and phone” of the Obama era, agencies have been unleashed by the even more radical (and underestimated) Biden to issue guidance, memoranda, notices, circulars, bulletins, letters, interpretations and other incarnations of regulatory dark matter. Even the simple Trump-era online portals to help the public more easily locate guidance documents have been eliminated, with some agencies using verbatim, boilerplate rationalizations for the move. The 20 senators who wrote to Biden twice earlier this year expressing concerns over the loss of the portals were met with silence.
The upshot of all the foregoing is that, rather than act as a watchdog (albeit never that aggressive), the OMB is now to join the thousands of regulators to not only help write and lobby for new regulations, but to even come up with new regulatory proposals, unceasingly, in whatever realm the left fancies that somebody’s benefits exceed somebody else’s costs. OMB’s ostensible cost-benefit balancing stance has shifted to one of seeming one-way regulatory expansion, with emphasis on new and social-engineering benefits such as those of “human infrastructure.”
It is by now obviously alien to this so-called “progressive” mindset, but there is an alternative view that, while the government does have a certain limited role to play in our lives, governments are the impediments to rather than facilitators of most social and economic values we strive to attain.
In response to Biden and the progressives, the more market-oriented members of Congress, while stuck in the progressive ditch so to speak, should prepare ahead of time a regulatory reform agenda for the 118th Congress that will be seated just over a year from now, under the not-unreasonable assumption that the next Congress will be less “progressive” than the 117th. For example, administrative state reforms like better disclosure and accountability have been covered by policy advocates in detail, and proposed by the legislators themselves.
These all matter a great deal. Biden would of course never sign them, but regulatory liberalization needs to be a prominent part of the coming decade’s policy conversation. However, something stronger is needed alongside them, a marker rejecting the Biden pro-regulatory agenda more forcefully even than Biden rejected the Trump liberalization agenda with his series of revocations of Trump actions.
What might that option be? A proposal for an “Office of No.” Healthy government requires recognizing downsides to coercive interventions like Biden’s sweeping agenda. But even more, it also requires vigilant legislative and executive institutions and mindsets that both seek reasons not to add yet another rule or decree to the existing inventory of hundreds of thousands. And those institutions should incessantly purge rules — and agencies, too.
Therefore, to supplement or replace OMB’s now-discarded review function, an Office of No should be specifically chartered to formally articulate and place in a growing public record the case against every regulatory measure that the rest of the unelected bureaucracy, consultant class, and media stand in uniform, unwavering support of, and present alternatives. Keep the office at OMB if you like, but that’s not necessarily important. A congressional committee could be devoted to its oversight and to the regulatory reform theme as such. Unlike the reflexive stance of Washington, most matters are not public policy questions. While “market failure” is said to justify regulation, more common are political failure and the failure to have markets. While, again, full realization would need to await a Biden successor, the body of evidence can eventually be used as inputs into other long-standing proposals such as a Regulatory Reduction Commission to reduce the contours of Washington.
All regulatory enabling statutes, and subsequent proposed rules and final rules, contain ambiguities that could have been resolved differently; they also sport unintended consequences perhaps not apparent at the outset. Yet, once rules and the agencies administering them are in place, they become part of the breathed air, costs of entrenchment forevermore ignored. Then their scope expands; resolutions of even newfangled policy issues get constrained by the self-interested blinders of the central-bureaucracy perch itself. We get trends toward greater centralization and away from free enterprise and the dispersed expertise necessary for genuine governance, entrenching agencies whose time has perhaps come and gone, if it ever actually came at all. The Federal Communications Commission’s net neutrality rule has been a come-and-go example for over a decade that typifies the administrative state’s pretense at expertise, that comes at the expense of not just sound resolution of the specific dispute at hand, but of the economy as a whole. Congress, in bipartisan fashion, often compounds these errors with highly regulatory legislation like the infrastructure bill and this past summer’s so-called Endless Frontier Act that also disregarded property rights and elevated central government management in economic affairs that should be left free.
Read the full article at Forbes.