Last week, the Commodity Futures Trading Commission received a letter from a group of overseas regulators. The letter urged the CFTC to "ensure that rulemaking works not just domestically but also globally" before rules take effect. In other words, the CFTC should think before it regulates-not an outlandish request. If the CFTC were to take the formal steps to think through its rules that non-financial regulators are required to take, it would be a watershed event in the course of Dodd-Frank implementation.

Evaluating problems and solutions before regulating is critical, so a system is in place to ensure that regulatory agencies do so. Before adopting a regulation, agencies must pinpoint the problem they are trying to solve, think about whether a regulatory solution makes sense, identify alternative regulatory solutions, and rigorously analyze the costs and benefits of each of the alternatives. Agencies are required to make their analyses-and the assumptions underlying the analyses-transparent so that interested members of the public can comment on them. These analyses are reviewed by regulatory specialists in the President's Office of Management and Budget before a regulation is approved.

The problem is that independent regulatory agencies are not subject to any of these requirements. Because most financial regulators are independent regulatory agencies, almost all Dodd-Frank rulemaking is being done without the systematic analysis that other agencies are required to perform. In fact, Dodd-Frank changed the status of the Office of the Comptroller of the Currency, which was formerly subject to regulatory analysis requirements, so that it is now able to regulate analysis-free as its fellow financial regulators do