A Process for Cleaning Up Federal Regulations
As numerous commentators have pointed out, the growth of regulation is a big problem for the US economy. In 2011, for example, there were more than 165,000 pages of federal regulations with which American companies had to comply. Concern over increased regulation has led to increased policymaker focus on the retrospective analysis and review of regulations, including three important executive orders issued by President Obama beginning in 2011. Retrospective review is important because, unlike the private sector, where the allure of profits and the push of competition force companies to constantly reevaluate internal rules, the public sector has no internal incentive structure to reevaluate regulations for cost-effectiveness. As Senator Mark Warner (D-VA) stated in a recent conference, “Where is the process to clean up regulations?” In many ways the root cause of the current state of affairs is not the growth of new regulations, but rather the lack of an efficient and effective regulatory review process.
This paper suggests a process to identify, evaluate, and eliminate inefficient regulations. Combining lessons from two successful government reform programs—the Base Realignment and Closure Act in the United States and the Dutch Administrative Burden Reduction Programme—the proposed framework would identify the regulatory costs associated with a historical piece of legislation and create a target for reduction in regulatory costs. Because of its ability to remove politics from the reform process, BRAC-like approaches to reform have been suggested for reforms in many areas. For example, 2008 Republican presidential candidate John McCain proposed a BRAC-style process to eliminate government waste, and the San Antonio Express suggested that Medicare and Social Security be reformed using a BRAC-style process. More recently, and directly related to the issue of regu- latory reform, Michael Mandel from the Progressive Policy Institute proposed an independent Regulatory Improvement Commission explicitly patterned after the BRAC Commission.
Our paper proceeds as follows. Section 2 describes the Dutch Administrative Burden Reduction Programme and how it has reduced and eliminated inefficient regulations in the Netherlands. In section 3, we discuss the Base Realignment and Closure Act, the reasons why it has been so successful in leading to base closures and realignments, and how it has served as an example for other countries. Section 4 combines elements of these two programs into a two-step process for identifying and eliminating outdated and inefficient regulations. Section 5 concludes.