Published
February 10, 2021
Fairness and transparency are essential in regulatory policy to enable businesses to invest and grow. These attributes are especially critical in a time of uncertainty when the economy is trying to recover.
Unfortunately, the new administration is rolling back policy that now, more than ever, is needed to advance smart regulations and fair implementation that allows businesses to innovate and reopen with confidence.
For example, on its first day in office, it rolled back two Executive Orders that ensured agencies used their enforcement powers fairly and provided the necessary guidance for businesses, individuals, and non-profit organizations to stay on the right side of the law. Executive Orders 13891 and 13892, issued in October 2019, promoted transparency and due process in the historically opaque and murky world of federal regulation.
- Executive Order 13891 required agencies to publish guidance documents online in a centralized location to help the public more easily navigate the tens of thousands of agency guidelines that have been disseminated through everything from email, social media, to agency meetings. The Order also allowed for public input on guidance before being finalized.
- Executive Order 13892 protected individuals and organizations from enforcement actions that were unfairly based on guidance documents, and it gave them a chance to be heard before the government brought an action against them. It also encouraged cooperation with the government by waiving or reducing penalties when companies self-reported regulatory violations.
Together, these orders protected the private sector against the unfair use of agency guidance documents and encouraged collaboration and cooperation between the public and private sectors.
These Executive Order rollbacks are a troubling signal that the new administration is poised to reinstate a regulatory regime that unfairly empowers the government to regulate private conduct and forces companies to spend thousands of hours and millions of dollars figuring out rules that are often unclear and defending against government actions that are not legally grounded/justified.
The administration also signaled that it could rescind another good-government safeguard. Under the last administration, the Department of Justice banned “slush fund settlements.” This practice allowed government prosecutors to direct settlement funds to private special interest groups—which could be political allies or supporters of those in power—instead of the government or victims. Putting this reform on the chopping block could lead to potentially abusive enforcement activity.
Fair enforcement policies and smart regulatory policy are essential. The Chamber recognizes the need for important protections such as workplace safety and protections for public health and the environment, but we oppose policies that are not appropriately justified or which layer on costly requirements at a time when our nation is in need of economic recovery. Poorly designed government policies may cause more harm than good and squash innovation and job creation. While these approaches are often distilled into either “regulatory” and “deregulatory,” in reality we simply want to regulate smarter, by basing rulemakings on thoughtful and transparent technical foundations.
As the Biden administration considers revising the technical foundations of the regulatory review process and the underlying regulatory benefit-cost analysis guidance in OMB Circular A-4, which was established almost three decades ago, it should pursue an open exchange of information and perspectives from affected stakeholders in the private sector. Providing greater consistency and transparency in the cost-benefit analysis process is fundamental to improving agency decision-making and seeking input from the business community will help implement more durable public policy.
Poorly designed and overly burdensome regulations not only layer on onerous requirements, paperwork, and legal liability to large and small businesses, but they dampen needed investments in areas such as infrastructure that could help schools, non-profits, and state and local governments through the economic recovery. Revoking the 2017 Executive Order 13807 pulls the rug out from under infrastructure investments by reverting back to the unreasonably long and uncertain federal permitting processes. Now more than ever, we need infrastructure investment to put people to work and provide economic opportunities to underserved communities.
The opportunities brought by rebuilding America’s infrastructure is why we launched a campaign Build By the 4th of July, to drive federal investment in infrastructure, but we won’t be able to build projects if they are caught in the bureaucratic red tape that is the federal permitting process. Streamlined federal permitting is necessary to build the clean energy infrastructure to improve our climate, deploy broadband infrastructure to help bridge the digital divide, and upgrade our crumbling roads and bridges to connect people and our commerce.
Excessive regulations coupled with unfair adjudication processes will only serve to undermine the recovery and make it harder for Americans to navigate the complex maze of rules and their associated compliance requirements. We urge the Biden administration to engage in an open and collaborate process that will help businesses drive the economic recovery and preserve personal freedoms.
