'Farm dust' debate highlights wider battle over regulations
This article first appeared in the St. Louis Beacon, Dec. 14, 2011 - WASHINGTON - Imagine a cadre of inspectors taking air samples near dry dirt roads and corrals in rural Missouri and Illinois. If they find too much "farm dust" in the wind, the enforcers would dole out stiff fines to hapless farmers or ranchers.
That was the scenario described by House GOP lawmakers who voted overwhelmingly last week to approve the Farm Dust Regulation Prevention Act to sweep aside any such dust rule, which Speaker John Boehner, R-Ohio, declared would "destroy jobs."
But there's a slight problem; no "farm dust" regulation exists. In fact, the head of the Environmental Protection Agency pledged in October not to propose such a rule. "Pure fantasy" is how U.S. Rep. Henry Waxman, D-Calif., described the threat of farm dust rules; another Democrat said it was akin to fighting imaginary "fairy dust" regulations.
Even if the debate over farm dust seems to fly in the face of logic, it is emblematic of the extent of GOP and business objections to many federal regulations, which have emerged as a major issue in Congress as well as the presidential campaign.
The day before approving the farm dust bill, House Republicans -- with almost no Democratic votes -- passed what one lawmaker described as "the mother of all anti-regulation bills" -- the Regulations from the Executive in Need of Scrutiny (REINS) Act. It would require explicit congressional approval for all major new regulations.
While the REINS and farm-dust bills will encounter severe headwinds in the Democratic-controlled Senate, Republicans including Sen. Roy Blunt, R-Mo., and Rep. Todd Akin, R-Wildwood, have joined every other GOP member of Congress from Missouri in cosponsoring the farm dust bill and denouncing "excessive government regulation."
"Our No. 1 priority in Washington must continue to be limiting onerous regulations and passing common-sense policies that will jumpstart our nation's economy," Blunt said recently. Akin called on the White House to "stop the 'red tape machine.'"
Some Democrats have jumped on the anti-regulation bandwagon, too, including Sen. Claire McCaskill, D-Mo. She not only backs the farm dust bill, but she introduced legislation last week with Sen. Susan Collins, R-Maine, that would delay one of the most controversial new rules, the EPA's planned new "utility MACT" mercury and toxics standards for coal- and oil-fired electric steam generating units. The U.S. Chamber of Commerce calls it "the most expensive rule the EPA has ever issued," and House Republicans included a MACT delay in this week's bill to extend the payroll tax cut.
The Obama administration, responding to GOP and business criticism, is also taking some steps to reassess and limit some regulations. Earlier this year, administrative law scholar Cass Sunstein, who heads the White House regulatory affairs office, was asked to lead a government-wide review this year of existing regulations. But GOP leaders and the U.S. Chamber of Commerce criticize the initiative as too little, too late.
A Gallup survey released Monday found that the 64 percent of Americans who say that big government is the biggest threat to the nation is just one percentage point shy of the record level (set in 2009) since the poll began in 1965. The percentage who name Big Business as the top threat was 26 percent; and Big Labor was cited by only 8 percent.
Sensing such trends, House Republicans have made scaling back federal regulation a central goal of their "Plan for America's Job Creators." In fact, about half of what Boehner calls the "27 job-creating measures (that) have been passed by the House" and await Senate action are aimed at regulations.
"Stopping excessive government regulations that threaten job growth is a key part of the Republican jobs plan," Boehner said. But House Democratic Whip Steny H. Hoyer, D-Md., said the GOP's focus "is based on the same failed claim that deregulation will lead to job growth. Economists from both sides of the aisle strongly disagree and have said the link between regulations and unemployment is negligible."
Who's right? Or is the truth somewhere in between?
Impact of Regulations on Jobs
It is no surprise that studies by conservative think tanks and business organizations tend to support the notion that over-regulation stifles jobs, and corresponding reports by liberal groups usually reach the opposite conclusion.
Every year, the Weidenbaum Center at Washington University (formerly the Center for the Study of American Business) documents the cost of developing and enforcing federal regulations. This year's study reported that the budgets of federal regulatory agencies shot up by 5.7 percent (to $54.9 billion) between fiscal 2010 and 2011, and noted that the cost was likely to increase again in 2012. The number of staff working to develop and enforce regulations is expected to increase by about 10,000 people over 2011 levels to reach an all-time high of 291,676.
Reflecting similar trends, the conservative Heritage Foundation think tank, in its most recent "Red Tape Rising" report found that 15 major regulations were issued in the first half of fiscal 2011 "with annual costs exceeding $5.8 billion and one-time implementation costs approaching $6.5 billion. No major rulemaking actions were taken to reduce regulatory burdens during this period." Overall, the report asserted, the Obama administration imposed 75 new major regulations from January 2009 to mid-FY 2011, with annual costs of $38 billion. There were six big deregulatory actions during that time, with savings of $1.5 billion.
"This flood of red tape will undoubtedly persist," the Heritage report said, "as hundreds of new regulations stemming from the vast Dodd-Frank financial regulation law, Obamacare, and the EPA's global warming crusade advance through the regulatory pipeline -- all of which further weakens an anemic economy and job creation."
Making similar claims is the U.S. Chamber of Commerce, which asserts that businesses with fewer than 20 employees "incur regulatory costs 42 percent higher than larger businesses with up to 500 employees," and estimates that the average regulatory cost for each employee of a small business exceeds $10,000 a year.
Arguing for regulatory reform, the chamber says that the system "operates without effective checks and balances or accountability... The process has lost all balance as Congress has yielded power to the federal agencies without proper accountability, and without taking responsibility for what the agencies are doing in Congress's name."
But many other studies, mainly by liberal or nonpartisan groups, have concluded that, taken as a whole, government regulations also can have a positive impact on job creation, public health and other factors.
"People who have studied the connections between regulations and job loss find those [conservative] charges not to be true," said Sidney Shapiro, who teaches regulatory law at the Wake Forest University's law school and is vice president of the Center for Progressive Reform, a network of law professors focused on regulatory policy.
"It is true that some workers may lose their jobs at the places being regulated. But economists look at total impact on jobs. And they find either that the total impact on jobs is neutral -- there's no net loss -- or we actually gain jobs through regulation," Shapiro told the Beacon.
"The reason for that is, when you require someone to meet a regulation, then that company has to spend money to do so. They have to buy equipment, hire workers to make sure they comply with the regulation, then buy things -- and that creates economic activity."
Shapiro and other experts cited studies on federal regulations by the Economic Policy Institute, a nonprofit think tank that factors the needs of low- and middle-income workers into discussions about economic policy.
EPI studies have concluded that the benefits of regulations have significantly and consistently exceeded their costs and also assert that the cost of complying with the Obama administration's EPA rules are tiny relative to the size of the economy and are offset by the economic and public-health benefits from the rules.
The EPI's head of regulatory research, Isaac Shapiro, argued in a policy statement that "academic studies of and data on the relationship between employment and regulations generally find that regulations have a modestly positive or neutral effect on employment." He attributed the nation's economic ills to "a huge shortfall in demand, not regulatory uncertainty." And he contended that new EPA regulations "can be expected to have a negligible effect on the overall economy."
But R.W. Hafer, a research professor of economics at Southern Illinois University Edwardsville, begs to differ. He wrote in a recent Beacon op-ed that "the cost of enforcing the jumble of social regulations, from consumer safety to energy to homeland security, has increased at alarming rates in each of the past several decades."
That resonates with the message of Rep. Sam Graves, R-Tarkio, who chairs the House Small Business Committee and says many of those new rules are having a negative impact on small businesses. Graves was a prime advocate of the House-passed Regulatory Flexibility Improvements Act, which would require federal agencies to determine the economic burden of new regulations on small businesses.
In an op-ed about the bill, Graves cited a Gallup survey that found that "small business owners cite compliance with government regulations as the most important problem facing them today . . . most small firms are simply being crushed by the onslaught of federal regulations."
'Tsunami' of Regulations?
While Republican critics have accused the Obama administration of unleashing a regulatory tsunami on the nation's businesses, some studies of rulemaking trends have found the claim to be overblown -- and the White House refutes it.
A Bloomberg News review of government data this fall found that the Obama administration had written about 5 percent fewer new rules than the Bush administration at the same point in their respective terms (after 33 months in office).
However, the Bloomberg study concluded that the average annual cost to businesses under Obama is higher than under his predecessors. Estimates of that hike in the cost to business have ranged from a low of about $100 million to a high of about $4 billion. Even the higher level represents a tiny percentage of the total economy.
According to the Government Accountability Office reports, the range in estimated costs of new regulations of the past 12 months (through Oct. 1) was between $8 billion and $9 billion, which is a decrease from the previous fiscal year.
Factoring in that estimate, the Bloomberg analysis said the average annual cost of regulations so far in the Obama administration was between $7 billion and $11 billion. That compares with the average of about $7 billion in annual rule-cost increases between 1981 through 2008. However, the record year for a regulatory cost increase was 1992, under President George H.W. Bush, at $20.9 billion in current dollars.
Even so, Obama asked his regulations czar, Sunstein, to review the cost-effectiveness of all regulations. In an op-ed earlier this year, Sunstein wrote that 30 different government agencies and departments "are laying out regulatory reforms that will save private-sector dollars and unlock economic growth by eliminating unjustified regulations."
The Chamber of Commerce labeled as "disingenuous" Sunstein's claim that the Obama administration had issued fewer regulations than the Bush administration in its first two years. Citing a study of regulatory activity by the Competitive Enterprise Institute, the chamber said the Obama administration had issued 408 "economically significant" rules in its first two years, compared to 339 for Bush.
Farm Dust Rules: Real Threat or 'Smoke Screen'?
The flap over farm dust may seem overblown to casual observers, but it has become a rallying cry for rural lawmakers, farm groups and others who fear tougher regulations. And it has become a measure of the strength of the anti-regulation wave in Congress.
Under the Clean Air Act, the EPA sets air-quality standards, including limits on "coarse particulate matter" -- air particles which some call soot or dust -- that can cause lung problems when inhaled. States then develop plans to implement the standards.
During Bush's administration, the EPA issued new standards without updating a key particulates standard. A federal court, ruling in 2009 on a suit filed by environmental groups, ordered the EPA to revisit the fine-particle standard and make sure that it sufficiently protected public health.
This spring, as part of an assessment of the EPA's options, government scientists questioned the effectiveness of the current "fine particle" pollution standards, implying that stricter rules may be needed. At the same time, the EPA has been reviewing standards for larger "coarse particles," which are associated with the dust or soot from farming and mining operations.
Initially, the EPA defended the idea of making the thresholds for unsafe levels of dust consistent in rural or urban areas. But EPA Administrator Lisa Jackson said on Oct. 14 that she would not seek stricter rules on farm dust for at least five years.
That promise did not satisfy Rep. John Shimkus, R-Collinsville, and other GOP members of the House panel that approved the farm-dust bill. "While EPA has said that it does not plan on regulating farm dust, I just don't trust its leaders not to change their minds somewhere down the road," Shimkus said.
On the day of the House vote last week, the Chamber of Commerce sent an "alert" to all House members, warning that the dust vote was so crucial that the chamber might include the vote in its annual "scorecard" ratings of lawmakers.
While the Farm Bureau and ranching groups lobbied strongly for the House bill, National Farmers Union President Roger Johnson said the concern in rural communities had been heightened by misinformation. "Congress should stop politicizing this issue and move on to passing meaningful legislation," Johnson said.
Rep. Hoyer called the farm dust bill "a smoke screen for Republican inaction on legislation that is actually important . . . Even worse, the bill's definition of 'nuisance dust' is overly broad and makes it easier for mining, smelting, excavation, and industrial operations to pollute in rural communities."
For that reason, Obama has threatened to veto the bill if it comes to his desk. An administration policy statement said the bill "purports to address a problem that does not exist" and is written in an ambiguous way that "could be used to roll back existing public health protection limiting pollution from mining operations, industrial activities, and possibly other sources."
The farm dust bill's fate is cloudy in the Senate, where only two Democrats -- McCaskill and Sen. Ben Nelson of Nebraska -- have explicitly said they would support it.
"You can't regulate dust on the farm; that's silly," McCaskill told the Beacon last month. Asked about the EPA promise not to issue farm-dust rules, the senator said: "I understand that the EPA has said that and I think that's great. But I also don't see a great deal of harm in putting that in legislation also. It is ridiculous -- the notion that the EPA would somehow want to regulate dust on country roads."
More predictably, Blunt is among the outspoken GOP senators on the farm dust issue -- as well as the "regulation stifles jobs" position. "You can't farm without dust, and the EPA's attempts to regulate this basic reality of the agriculture industry will hurt countless job creators nationwide," said Blunt, who grew up on a dairy farm. He is cosponsoring a Senate bill by Sen. Mike Johanns, R-Neb., that would block any farm-dust rule.
Blunt also introduced legislation with Sen. Mike Crapo, R-Idaho, and five other senators to exempt manure and poultry litter from liability and regulation under the Superfund law. He said the bill aims to "prevent the Obama administration from imposing yet another needless and burdensome regulation on America's food producers."