CPR's Eye on OIRA

Public Scrutiny for an Unnoticed Regulatory Powerhouse 

The Office of Information and Regulatory Affairs has an unenviable reputation. The media can’t seem to resist calling it “obscure,” and often refer to its director as the “regulatory czar.” Among progressives, it’s regarded as an unduly sympathetic ally of industry lobbyists trying to water down or kill protective regulations.
 
In fact, all those things are more or less true. It’s “obscure” because most people have no idea what it does; its director is fairly described as a “czar” (within the meaning of the term in Washington, not in pre-revolutionary Russia!) because he wields extraordinary power over the regulatory structure; and it is clearly the place where industry lobbyists pitch their tent, hoping to delay, dilute, distort, or defang protective regulations.
 
OIRA is one other thing, as well. It is also the office that forces regulatory agencies to subject proposed regulations to systemically flawed cost-benefit analysis – a method of regulatory impact analysis that overstates the costs of protective regulations to industry (largely by relying on inflated industry estimates) and understates the benefits of such regulations (often by simply ignoring those that do not carry a price tag). 
 
So for example, one EPA cost-benefit analysis calculated the worth of IQ points that children lose to in utero mercury poisoning by “guesstimating” the impact on the children’s future earnings. (The analysis also treated the diminished likelihood that the children would attend college as a cost savings – weighing in on the side of not bothering to regulate mercury!) Absent from the analysis because they don’t lend themselves to conversion into dollars and cents were some obvious points: that money alone doesn’t make up for brain damage, and that no parent would “sell” their child’s IQ points. Such cost-benefit analysis outrages are all too common. Significantly, most of the statutes under which agencies regulate call for some other form of regulatory impact analysis; cost-benefit is only rarely required by law. It is imposed by executive order not by statute, and could be just as easily “un-imposed” by a President inclined to remove what was intended to be, and has plainly become, a tool for scuttling protective regulations.
 
An “obscure” government agency that wields outsized power is in dire need of scrutiny. That’s exactly the rationale for CPR’s Eye on OIRA project, launched in 2010 to monitor and report on the activities of the Office of Information and Regulatory Affairs. The project does not exist solely to scold OIRA. When the office is supportive of protective regulations and regulatory agencies, when it plays a constructive role in the regulatory process, CPR Member Scholars praise the agency. When OIRA strays, however, overstepping its mandate or serving as a conduit for industry complaints, the Member Scholars say so.
 
For a primer on OIRA's function and authority, read OIRA 101.  To see what rules are where at OIRA, check out OIRA's online dashboard.
 
The latest sightings from CPR’s Eye on OIRA:
  • Eye on OIRA, soup to nuts:  Read all Eye on OIRA posts on CPRBlog.
  • OIRA and Cock Roaches? Read Rena Steinzor's August 30, 2010 testimony before an EPA panel conducting regional hearings on regulating coal ash, in which she explains why the supposedly "irrational" refusal of human test subjects to drink a glass of water from which a cock roach had just been removed is at the heart of OIRA's extraordinary rationale for tilting a cost-benefit analysis against regulating coal ash.
  • OIRA and Transparency: Despite the Obama Administration's commitment to transparency in government, OIRA is operating in opaque mode, according to a June 22, 2010 CPRBlog post from Rena Steinzor.
  • OMB Report to Congress. OMB submits annual reports to Congress on the benefits and costs of federal regulation. And like clockwork, CPR Member Scholars analyze the submission and respond.  Read the2010  response from Sidney Shapiro, Amy Sinden, Rena Steinzor, and James Goodwin. Their four main points: OMB's habit of providing Congress with aggregate costs and benefits of regulation is "fundamentally counterproductive" and OMB should abandon it; the report makes clear that OIRA intends to continue "micromanaging agency decisionmaking," even though the agencies are the ones with mandates from Congress; while the report's call for transparency is laudable, the recommendations "are incomplete"; and the Interagency Task Force approach used to develop a proposed value for the social costs of carbon, an approach OMB holds up in its reort as a model of transparency, was anything but transparent -- the task force's members were never revealed and it took no public comments, while using flawed economic models, data and assumptions. Here's OMB's report.  Read more about OMB's annual reports to Congress.
  • Coal Ash. After a months-long struggle between EPA and OIRA, on May 3, 2010, EPA released not one but three proposals for dealing with the problem of hazardous coal ash waste.  EPA sent a proposed rule to OIRA in mid-October 2009, starting a 120-day clock for OIRA's consideration of the proposal.  What followed was a massive lobbying blitz by the industry, that included more than 40 meetings with OIRA staff -- all to talk about a rule whose substance was the province of EPA, not OIRA.  In February, the clock expired, but no rule emerged, and neither, for that matter, did an explanation as to why the time had run out without action.  The May 3 announcement included three proposals, one a watered-down version of EPA's original proposal and two weaker ones.  CPR's review of the paper trail between between EPA and OIRA, subsequently released by EPA, shows exactly how EPA's proposal came to be watered down.  Read all about it, here and here. Read all CPRBlog entries on coal ash.
  • OIRA’s First Review Letter of the Obama Administration. On March 19, 2010, Administrator Cass Sunstein issued OIRA’s first Review Letter of the Obama Administration, offering guidance to the Administrator of the National Highway Traffic Safety Administration (NHTSA) on how to implement the agency’s new “Tire Fuel Efficiency Consumer Information Program.” Under this program, NHTSA must develop a system of fuel efficiency ratings for tires, which consumers can consider when deciding which replacement tires to buy for their cars. OIRA’s Review Letter directs the agency to employ behavioral economics principles, such as “clarity” and “transparency and meaning,” when designing the labels for communicating the ratings to customers. For background on the different type of OIRA letters, see here.
  • Letter to White House Counsel re OIRA.  On March 17, 2010, CPR Board Members Robert Glicksman, Thomas McGarity, Sidney Shapiro, Amy Sinden and Rena Steinzor wrote a letter to White House Counsel Robert Bauer requesting a review of "ongoing violations of presidential executive orders by the Office of Information and Regulatory Affairs," specifically, OIRA's routine assertion of jurisdiction over "guidance documents" from regulatory agencies despite EO 13,497 despite a revocation of that authority by the President; OIRA's exceeding deadlines for completing reviews under the terms of EO 12,866; and OIRA's failure to disclose "before and after" documents allowing the public to determine what changes were made to regulatory actions after OIRA's review (again, a violation of EO 12,866).
  • Nitrogen Dioxide.  Between December 2009 and January 2010, OIRA pressured EPA to weaken a proposed rule on nitrogen dioxide emissions.  EPA had proposed requiring all metropolitan areas with a population of 350,000 people or more to install a monitoring station to measure nitrogen dioxide (NO2) emissions near a major roadway in the area. By the time OIRA completed its review on January 22, 2010 the minimum threshold for monitoring stations had been increased to 1 per 500,000 people.  Read CPRBlog entries on the subject from Rena Steinzor and James Goodwin, here.
  • Obama Administration’s Regulatory Report Card. At the end of President Obama’s first year in office, CPR Member Scholars took a look back at the Administration’s emerging record on regulatory issues, grading each of the five “protector” agencies – EPA, NHTSA, CPSC, OSHA and FDA – and OIRA, because of its key role in the regulatory process. OIRA earned the lowest grade in the report, a C-. Read the report, Obama’s Regulators: A First-Year Report Card, CPR White Paper #1001, and the news release, January 14, 2009.
  • Regulatory Process Executive Order.  One year into the administration, and half a year after the President’s deadline for a draft, a new executive order to replace or amend EO 12866, establishing critical rules of the road for regulatory agencies in the Administration, has yet to emerge. Read CPR's November 20, 2009 Editorial Memo on the Obama Administration's Executive Order on Regulatory Process, by Rena Steinzor and Robert Glicksman.  And the very similar press backgrounder.
  • Cass Sunstein. When Cass Sunstein was nominated to the post of OIRA Administrator, CPR Member Scholars waved a warning flag, noting that despite his general reputation as a progressive, on matters of regulatory policy, Sunstein’s views were not so different than those of Bush Administration OIRA directors. Read more.