by Roy Gamse and Robert Wolcott
The Trump administration has heralded, in words and deeds, its determination to reduce the number of federal regulations and their economic impacts. In a total contradiction, Trump’s Environmental and Protection Agency (EPA) has now proposed a new regulation that is totally unnecessary, provides no benefit to public health or the environment and appears designed only to yield lawsuits and delays.
The proposed regulation specifies how cost-benefit analyses must be prepared for every significant new rule under the Clean Air Act (CAA). But here’s the problem: There is nothing in the CAA that requires cost-benefit analyses. In fact, for some CAA rules, such as health-protective air quality standards, consideration of costs is not even allowed.
Why, then, do we need this regulation? Will it help reduce pollution and improve air quality? It will not. This regulation asks nothing of polluters, or of the city and state agencies that help control air pollution. EPA’s own proposal says, “This proposed procedural rule would not regulate any person or entity outside the EPA.” In other words, the regulation is aimed at the EPA’s own staff; its purpose is to place obstacles in their path as they attempt to rein in polluters.
You may wonder if there is a need to determine whether regulations on air pollution are worth their costs. But, contrary to the myth of overly burdensome regulations, EPA’s rules have long produced benefits that vastly exceed costs. In fact, the Trump administration’s own Office of Management and Budget (OMB) in a 2018 report to Congress, concluded that rules from EPA had the “highest estimated benefits” across the federal government. An earlier study of 30 years of air quality improvements under the CAA found benefits more than 30 times greater than costs.
Or perhaps there is a need to define how to do a cost-benefit analysis when drafting a new regulation? Again, the answer is no. A series of executive orders, starting with Ronald Reagan, calls for cost-benefit analyses of major rules, and there is a long history of preparing them.
OMB, which since 1981 has centralized the review of such analyses, issued a document in 2003 that spells out the requirements in detail. Moreover, EPA developed even more detailed guidelines in 2000, updated in 2010, on how to do these analyses; they were reviewed and blessed by an independent national panel of expert economists. Those guidelines provide greater detail than the CAA proposed regulation, and are based on pure economic theory unfettered by political bias. The new version of the guidelines for cost-benefit analyses is being reviewed by the current expert panel, headed by the executive who published the previous set of OMB guidelines.
So, again, why propose a new regulation?
The only reason we can see is to create legally binding requirements, which are not required by the CAA, that EPA regulators must follow when developing new regulations on air pollution. The result? Air pollution rules under future administrations could be delayed and blocked by industries that sue EPA — not for violating CAA requirements, but for not producing cost-benefit analyses that have nothing whatsoever to do with that law.
For an administration that says it wants to simplify and reduce regulation, this proposed regulation has no basis. Developing it has been a waste of resources, especially for an administration that professes a desire to reduce spending and government waste.
EPA has embarked on a transparent attempt to limit or stop future regulation. Last we heard, the Trump administration was vehemently opposed to creating unnecessary regulations and wasting taxpayer funds. Public comments on the proposed regulation are due on or before July 27, 2020.
It’s time to weigh in and kill this ridiculous proposal.
Roy Gamse is an economist and he is the former EPA deputy assistant administrator for Planning and Evaluation.
Rob Wolcott, also an economist, is the former EPA deputy assistant administrator for Policy. Wolcott is the chair of the Environmental Protection Network, a national volunteer non-profit organization of more than 500 EPA alumni. Gamse is an active member.