Republicans want it both ways on agency independence

First, they were against it. Then they were for it. Now, they’re both for and against it.

Republicans on the U.S. Senate Homeland Security and Government Affairs Committee (HSGAC) cannot make up their minds about whether to keep independent federal agencies free from White House oversight and influence.

In the latest development, HSGAC Chair U.S. Sen. Ron Johnson (R-Wis.) just released a report on behalf of the committee’s Republican members. The report alleges that the White House exerted undue influence over the Federal Communications Commission’s (FCC) Open Internet rule-making, more commonly known as “net neutrality.”

{mosads}The report states that, “As an independent agency, the president’s influence over the FCC, by design, should be limited.” Here, Johnson is correct. The U.S. Supreme Court has recognized the limits of executive power with respect to independent agencies.

The report concludes, “Limits on the president’s power over independent agencies — like the FCC — demonstrate the importance of maintaining the agency’s independence.” It certainly sounds like Johnson and Republicans on the committee favor independence from the White House for these agencies.

There’s just one big problem: These same lawmakers have aggressively pushed legislation this session that would increase White House oversight of, and influence over, independent agencies.

Last October, the HSGAC passed the Independent Agency Regulatory Analysis Act (IARAA) along party lines. The bill would allow the U.S. Office of Information and Regulatory Affairs (OIRA), a small White House office, to review independent agency regulations and provide feedback, including criticism on cost-benefit grounds.

But White House review fundamentally undermines the independence of independent agencies, as Johnson argued in his net neutrality report. After all, one aim of OIRA review is to ensure that “the President’s policies are reflected in agency rules.”

Why are Republicans in Congress — who have shown nothing but contempt for the current administration — backing legislation that would give the White House more authority and influence? Republicans want to empower OIRA because the agency often acts, under both Republican and Democratic administrations, as a roadblock for new public protections opposed by conservative lawmakers and corporate lobbyists.

Virtually every “regulatory reform” measure passed by this Congress has included provisions expanding OIRA’s regulatory review and oversight mandate. Some of these measures, such as the Regulatory Accountability Act, which passed in the U.S. House of Representatives with unanimous Republican support, would increase OIRA’s power dramatically. The IARAA would do the same, with serious consequences for agency independence.

The premise of the IARAA — that independent agencies do not conduct cost-benefit analysis of their proposed rules, thereby necessitating OIRA review — is both untrue and misleading. In fact, these agencies routinely run cost-benefit projections, but the analyses are by their very nature inadequate. Many of the rules agencies must evaluate have benefits and costs that are impossible, and in some cases wildly immoral, to monetize.

What is the monetary value of a financial firm disclosing more information to its investors? How can you assign a dollar value to the pain and suffering of a parent whose child was poisoned by unsafe lead levels in imported toys? Republicans pushing the IARAA refuse to acknowledge the practical and ethical limits of cost-benefit analysis.

What even ardent supporters of cost-benefit analysis have acknowledged is that cost-benefit projections are highly subjective as a predictive tool. Lawmakers should be applauding agencies that recognize the limits of cost-benefit analysis, not falsely accusing these agencies of doing no cost-benefit analysis at all.

The IARAA would ensure that even the mildest OIRA criticism of a rule — on subjective cost-benefit or any other grounds — will become part of the rule-making record and will be available for judicial scrutiny. This is particularly concerning in light of the deference courts may grant to OIRA’s expertise in this area.

Agency lawyers would be unlikely to approve any proposed or final rule that OIRA might disparage (or already did), fearing legal challenges from the rule’s opponents. Furthermore, any rule that received negative comments from OIRA would have to be significantly revised or entirely re-proposed to avoid running afoul of the “logical outgrowth” doctrine.

In other words, the IARAA would give OIRA significant influence and a virtual veto over independent agency regulations.

Last year, before Johnson’s committee passed the IARAA, the heads of nearly all the independent financial regulatory agencies, as well as the U.S. Consumer Product Safety Commission, submitted letters to HSGAC expressing the same concerns.

The IARAA, they warned, “would give any President unprecedented authority to influence the policy and rulemaking function at independent regulatory agencies and would constitute a fundamental change in the role of independent regulatory agencies.”

Sen. Johnson and HSGAC Republicans face a choice. Either they can protect the independence of independent agencies, or they can render them subordinate to the White House. They cannot have it both ways.

Narang is the regulatory policy advocate for Public Citizen’s Congress Watch division.