In his most forceful reply yet to industry groups and Republicans who have accused the administration of slowing the economic recovery by tying up businesses in red tape, President Obama has ordered a top-to-bottom review of federal regulations to get rid of rules that are outdated and harmful to the economy, the White House announced this morning.
Obama signed an executive order today that would step up oversight of the regulations issued by government agencies such as U.S. EPA and the Interior Department.
Seen as the president's latest effort to mend ties with businesses, it was first outlined by the president in an op-ed this morning in The Wall Street Journal.
Writing for an editorial page that has repeatedly slammed the administration's approach to regulation, Obama acknowledged that there are plenty of "absurd and unnecessary paperwork requirements that waste time and money." He cited EPA's recent decision to loosen rules for saccharin -- an artificial sweetener that is considered safe by the Food and Drug Administration and is widely used in chewing gum and diet soft drinks.
"If it goes in your coffee, it is not hazardous waste," Obama wrote.
"We won't shy away from addressing obvious gaps," he added, "but we are also making it our mission to root out regulations that conflict, that are not worth the cost, or that are just plain dumb."
Along with requiring agencies to take stock of existing regulations, the executive order would lay out principles for future rulemakings. All agencies would need to consider ways to reduce burdens for U.S. businesses when they develop rules, allow more public participation and better follow the scientific integrity guidelines that were released last month after a lengthy delay.
"The administration believes firmly that regulations can both be more effective and consistent with American competitiveness," a senior White House official said this morning. "It's not a question of choosing between meeting our responsibilities to protect the public health and the environment or growing the economy and creating jobs. It's really a question of how to get the balance so we can accomplish both goals most effectively."
The initiative could signal a desire at the White House to defuse some of the efforts on Capitol Hill to rein in regulations. Republicans and a few moderate Democrats have put forward a slew of bills that would put new checks on agency rulemaking (E&ENews PM, Jan. 10).
Sen. Mark Warner (D-Va.), who recently called for a "pay as you go" approach to outdated government regulations, offered support today for the president's strategy. Any company that does not review its operations or improve its procedures will inevitably go out of business, and the government should be held to the same sort of standard, he said in a statement.
"Efforts to apply more common sense to our regulatory approach can go a long way toward addressing the uncertainty that has kept the U.S. business community from participating more fully in our nation's economic recovery," Warner said.
Obama has recently reached out to businesses, meeting with corporate CEOs last month to ask how the government could help them create jobs and rebuild the economy. Industry groups were pleased by today's announcement.
"Manufacturers have been saying for some time that overregulation is harming job creation and stifling economic growth," said Aric Newhouse, senior vice president of the National Association of Manufacturers, in a statement today. "This is an opportunity for the president to demonstrate results by eliminating unnecessary regulations already in the pipeline or delaying poorly thought-out proposals that are costing jobs."
Seen as an effort to mend ties with businesses, the new executive order did not sit well with many on the left, including some environmental and public health groups. They described the initiative as a rightward shift as President Obama gears up for his own re-election campaign.
Rena Steinzor, the president of the Center for Progressive Reform, said the executive order reflects an incorrect analysis and diagnosis by the White House. Current environmental problems such as the Gulf of Mexico oil spill, as well as economic problems such as the collapse of the housing market, could have been avoided by better rules, she said.
She also criticized the White House for putting new burdens on agencies at a time when they are already dealing with serious budget cuts.
"It was deregulation that caused the economy to crash and everyone to lose their jobs -- not regulation," said Steinzor, an environmental law professor at the University of Maryland.
Scott Slesinger, legislative director at the Natural Resources Defense Council, agreed that a "balanced" approach is necessary -- as long as it does not put "short-term corporate profits above the public health."
With environmentalists preparing to battle Republicans in Congress over EPA regulations, he noted, Obama's op-ed cited the Clean Air Act as a prime example of a law that is worth the cost to society.
That type of calculus was praised by cost-benefit analysis supporters such as Richard Revesz, dean of New York University's law school.
"The environment and the economy are not at odds," Revesz said today. "On the contrary, the success of each one is linked to the well-being of the other. By making this case, the president pointed to a better way of safeguarding both."
Click here to read the executive order.
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