Conyers Accuses Republicans of Changing Rulemaking Process to Delay Healthcare Reform Implementation

Conyers Accuses Republicans of Changing Rulemaking Process to Delay Healthcare Reform Implementation

Slowing the Rulemaking Process Would Undermine the Authority of the Depts. Of Health and Human Services, Labor, Treasury, the Food and Drug Administration and Would Harm Consumers

(WASHINGTON) – Today, at the House Judiciary Subcommittee Hearing on “Formal Rulemaking and Judiciary Review,” Ranking Member John Conyers, Jr. (D-Mich.) criticized Republican Committee Members for their efforts to slow down rulemaking process and accused them of using legislative schemes to delay the implementation of the Affordable Care Act.

Republican Members planned the hearing and called on witnesses to discuss expanding the use of formal, trial-like requirements in the rulemaking process and push for judicial review of agency actions.   Such requirements would undermine the authority of major agencies, such as the Department of Health and Human Services, the Department of Labor, Food and Drug Administration (FDA), and the Department of Treasury (IRS) to implement the Affordable Care Act.

At the hearing, Mr. Conyers expressed the following concerns:

This Subcommittee appears to be steadfastly committed to finding ways to promote the interests of big business by hobbling and slowing down the administrative rulemaking process.  What would be the impact of slowing down the rulemaking process?  It means that rules intended to protect the health and safety of American citizens will take longer to promulgate and become effective.

                We are talking about regulations that protect the quality of the air we breathe, the water we drink, and the food we consume.  And, we are also talking about rules that ensure the safety of the cars we drive, the airplanes that convey us, and the places where we work.

                Slowing down the promulgation of these rules would only serve to put Americans at greater risk, while allowing polluters, makers of dangerous toys, and manufacturers of tainted drugs more time to avoid regulation.  Indeed, the benefits of regulation far outweigh the costs.   The latest draft Office of Management and Budget report to Congress on the cost and benefits of regulations concluded that for fiscal year 2010, federal regulations cost between $6.5 billion and $12.5 billion but resulted in between $23.3 billion and $82.3 billion in benefits. 

                In other words, even when taking the highest cost estimate and the lowest benefit estimate, the benefits of federal regulation last fiscal year were nearly double the costs. While admittedly the rulemaking process is probably not perfect, the proposals we will be discussing today will make that process much worse, not better.

                For example, the proposal to expand the use of the Administrative Procedure Act’s formal rulemaking procedures has been soundly rejected by virtually every administrative law scholar of all ideological persuasions as unnecessary and even harmful to the rulemaking process.  More than one commentator, in fact, has said that expanding the use of formal rulemaking is simply another way of telling agencies to stop issuing rules, including the kind of public health and safety rules that I just alluded to.

                It is puzzling to me why my friends on the other side of the aisle are promoting this idea when, in fact, more than a generation ago a similar idea was considered and rejected by Congress? Are we, yet again, being offered old wine in new bottles without any good reason.  Encumbering rulemaking with trial-like requirements such as cross-examination of government witnesses would not meaningfully improve the accuracy or fairness of agency decision-making.  Rather, it would greatly increase the cost and delay of issuing regulations. 

                Current informal, notice-and-comment rulemaking already imposes numerous procedural requirements.  Formal rulemaking procedures, on the other hand, would severely hamper the ability of agencies to promulgate beneficial rules or to revise or rescind existing regulations. 

                Formal rulemaking would also favor industry, which has the ability to fund protracted cross-examination and dilatory challenges to agency fact findings, while taxpayers would have to fund the agency’s ligation expenses.  And it would allow these regulated entities to effectively shape the agency’s rulemaking record to their advantage.

                There is also the risk that requiring more formal rulemaking will cause agencies to rely more on adjudications or guidance documents and other non-rulemaking processes as a means of policymaking, something that is not in anyone’s interest.  I would also be wary of statutorily creating a more stringent judicial review standard for agency rulemaking. 

                More stringent judicial review – like formal rulemaking – would make rulemaking even more costly and time-consuming for agencies.  This would force agencies to adopt more detailed factual records and explanations, effectively making it a back-door way to impose more procedural requirements on agency rulemaking.

                Also, a more stringent, less deferential judicial review standard runs the risk that judges could effectively make public policy from the bench without the specialized expertise that agencies possess.   It also could allow a judge to impose his or her personal policy preferences as part of their review of an agency rule.

                A more stringent judicial review standard opens the door to abusive litigation by well-funded business entities and others who oppose regulations generally by creating more opportunities to appeal an agency’s decisions, which would make rulemaking more costly and expensive without maximizing the benefits or minimizing the costs of regulation.

                I find it particular ironic that the Majority – which has long decried “judicial activism” and “abusive litigation by trial lawyers” – would support insinuating both of these elements as part of so-called regulatory reform efforts.

                As has been shown time and again, the benefits of regulation far exceed its costs.  Measures that ultimately are designed to hobble or prevent  regulation altogether therefore put society at risk.  This effort is just another example of how some want to allow the fox to guard the chicken coop, and we all know how well that worked given the events that led to the Great Recession. 

                Even former Federal Reserve Chairman Alan Greenspan, one of the most ardent proponents of

unregulated capitalism in the marketplace, belatedly recognized he was wrong. 

                Likewise, I believe both measures that we will consider today are wrongheaded.   Perhaps it is a sign of desperation that big business – in trying to stop regulation – seeks to push long-discredited ideas that prioritizes profit over consumer protection.

                I hope we can stop wasting our time on these types of hearings – which almost fetishize corporate interest above broader societal interest – and get back to focusing on issues that matter to ordinary Americans.

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