The NewStandard ceased publishing on April 27, 2007.

Executive Order Expands Presidential Power Over Agencies

by Michelle Chen

Jan. 24, 2007 – The White House has quietly amended a key executive order to tighten the president’s grip on federal agencies that enforce health, safety and environmental protections.

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The new order, issued last Thursday, gives the White House’s Office of Information and Regulatory Affairs (OIRA) enhanced tools to oversee and interfere with federal regulations on everything from warning labels on medicines to safety standards for construction worksites.

In a statement responding to the executive order, the watchdog group Public Citizen called the initiative "an appalling arrogation of power," charging the White House with claiming more executive will over federal agencies while circumventing congressional oversight.

The new powers build on a Clinton-era executive order that authorized OIRA to use cost-benefit analysis and other market-based calculations to evaluate rules and regulations proposed by federal agencies. Under that order, OIRA can compel executive-branch agencies, like the Occupational Safety and Health Administration and the Fish and Wildlife Service, to change proposed public-health, environmental and other regulations according to White House priorities.

The amended order enables the White House to oversee not only regulations, but also "guidance" documents that agencies issue to inform the public about how rules will be enforced – for example, an explanation of how a ruling in an environmental lawsuit will change the way polluters are regulated. OIRA can now scrutinize all "significant" guidance materials – defined according to criteria such as having the ability to "adversely affect" the economy in a "material way."

The new order gives the White House enhanced tools to oversee and interfere with federal regulations.

In a statement emailed to The NewStandard, Office of Management and Budget spokesperson Andrea Wuebker predicted the executive order will "lead to improvements in the way the federal government does business – by increasing the quality… and transparency of agency guidance documents."

Such "improvements" in the way Washington does business respond directly to industry demands. In recent comments filed with the administration, business groups like the US Chamber of Commerce complained that by issuing directives as "guidance," federal agencies are unilaterally expanding their regulatory powers outside of their legal mandates.

The amended executive order also now lists the economic concept of "market failure" as a standard for reviewing a proposed rule. In effect, when deciding if a safety or health protection is needed, OIRA could consider whether so-called "market forces" are somehow able to correct the social problem on their own, without government intervention. That view has been publicly promoted by Susan Dudley, Bush’s controversial pending nominee to head OIRA.

Critics say the abstract market-failure standard is set up to legitimize government inaction. The notion of the free market having the ability to eventually resolve public needs, they argue, could become an expansive pretext for OIRA to dismiss crucial regulatory protections.

Rick Melberth, director of regulatory policy with the liberal policy-research group OMB Watch, said that while the full implications of the order are still unclear, the move dovetails with the administration’s general hostility toward interference with business interests.

"They don’t want regulations to impact the regulated industries that are friends of theirs. This is one way they can make that process slow down," he said. "It’s a perfectly logical extension of their ideological approach to regulation."

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The NewStandard ceased publishing on April 27, 2007.

Michelle Chen is a staff journalist.

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