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ereignty under the Tenth Amendment and called on the federal government to "cease and desist” from actions that exceed the constitutional delegation of pow

ers from the states. • Seven states (Alabama, South Dakota, Arizona, California, Delaware, Michigan

and Pennsylvania) have passed legislation requesting that the state's federal delegation appear before the state legislature to discuss unfunded mandates

and other federally imposed requirements. • Four states (Arizona, California, Florida and Texas) have filed suit against the

federal government to recoup costs incurred due to the presence of illegal immigrants. The federal government has a constitutional duty to control the borders, so these states reason that the federal government's failure should not burden

the state's taxpayers. Policy Implications. The recent renewal of interest in the Ninth and Tenth amendments to the Constitution may encourage a reexamination of the full range of federal regulations and laws. In fact, both the Constitution and common sense require that the federal role in regulatory affairs be carefully defined rather than simply assumed. Together, the Ninth and Tenth amendments require the federal government to fully justify its every action. Furthermore, the federal government is not empowered to "deny or disparage” any rights of individuals without an express grant of authority in the Constitution. It is a government, in other words, of specific and limited powers over its citizens. And, finally, the states as political entities or through their respective citizens are presumed to retain all other governmental pow

Traditionally, the states were seen as laboratories of democracy. They were able and expected to develop policies appropriate to widely varying local conditions. Today, the federal government asserts authority over the full range of economic and environmental issues, imposing a "one size fits all” policy. It is time to reestablish the federal government in its proper role so that future power grabs become more difficult and less likely.

ers.

Five High-Cost, Low-Benefit Regulations

Regulation
Radionuclide emission control at coal-fired utility boilers
Benzene emission control at rubber tire manufacturing plants
Radionuclide emission control at uranium fuel cycle facilities
Sickle cell screening for non-black low-risk newborns
Chloroform private well emission standard at 48 pulp mills

CestLife-Year $ 2,395,161,000 $19,865,323,000 $33,750,000,000 $34,239,773,000 $99,351,684,000

Source: “Five-Hundred Life-Saving Interventions and Their Cost-Effectiveness," Tammy O.

Tengs, Sc.D., et al., 1994.

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Senator GRASSLEY. I would invite either one of you to respond to the questions because they aren't pointed for the most part, with one or two exceptions, to one of you.

Some will argue that the judicial review provisions will lead to more litigation and clog the courts. For instance, David Vladeck of Public Citizen points out that currently only final agency rules are subject to judicial review. He argues that risk assessment and cost/ benefit analysis are not usually subjected to judicial review and, of course, this would change under this specific bill, 343. What are

your views?

Mr. BREGER. Well, I have the greatest respect for David Vladeck, but I think in this instance he is wrong. It may be the case that there will be a number of additional lawsuits brought. I think it is more likely that when someone brings a lawsuit complaining about a regulation, they will add to that lawsuit the complaint, if they have one, about the cost/benefit analysis.

I think the discipline to the agencies of knowing that their cost/ benefit analysis, their regulatory impact statement, is going to be looked at by a court is a very significant discipline. I don't think courts have to get in there as partners and rewrite the cost/benefit analysis, but if an agency knows that someone is going to look at it with a green eye shade, they are going to take it more seriously.

Mr. FERRARA. I agree with Mr. Breger on that. I think you have got to have judicial review. People can have a lot of imagination when they sit down to write a cost/benefit analysis, and there has got to be somebody who is going to be able to look at it and make sure that it can stand the light of day. So I think it is absolutely essential and this is what the courts are here for.

Senator GRASSLEY. Do you see the negotiated rulemaking process fitting into the process that we have in this bill, the framework of this bill?

Mr. BREGER. I am, in general, very positive about negotiated rulemaking. I think it can play a very important part because it can bring the parties together. It can allow the agency to talk in a frank way with the affected parties. The affected parties no longer write speeches in rhetorical flourishes, but actually explain this is our specific problem with this proposed rule. The agency can respond, how about if we change this clause, would that solve your problem.

I think that any encouragement to negotiated rulemaking is a plus in the regulatory process, and a plus which will assist the reg. ulated community in living with regulations more easily, and will assist the regulators in making regulations that are going to tend toward the least restrictive alternative because they are going to be taking into account the problems of the regulated community.

Senator GRASSLEY. If it is a part of the process, do you think it ought to be exempt from the cost/benefit risk analysis?

Mr. BREGER. I haven't analyzed that point. I can respond in writing, if that is OK.

Mr. FERRARA. I have a view on that. I don't think it should be exempt at all from the cost/benefit risk analysis. The only restrictions that this legislation puts on negotiated rulemaking is where that rulemaking might go out of bounds. You certainly don't want people to negotiate a deal that makes total costs better than the benefits just because the parties in the room happen to like that deal. That doesn't necessarily mean everybody in America is going to be represented at that negotiating rulemaking.

I don't think people should be able to negotiate a rule where the costs exceed the benefits. I don't see any requirement in this legislation that puts an untoward burden on negotiated rulemaking. I think, in general, it will encourage it because agencies will want to hear from the parties what they are going to hear later in lawsuits and challenges if they don't hear it up front. Since negotiated rulemaking does tend to push the agency toward the least restrictive alternative, this will just help negotiated rulemaking. So I think it just supports that.

Senator GRASSLEY. Opponents of reform make this argument concerning competition and securities fraud that the rules there, too, are so different from rules, for instance, for foreign trade or drinking water standards that you can't have a one-size-fits-all reform process. Do you agree?

Mr. BREGER. You cannot, as an absolute statement, have one size fits all, but you can have a basic minimum. I think S. 343 provides a floor. You may find in particular instances that an agency may need some extra piece of review, or there may be an instance where you would decide, as Congress has decided in some Acts, that they don't want to have cost/benefit review. But it would seem to me that you should go into this with the clear understanding that you are creating a floor for all agency activity.

Mr. FERRARA. I agree with that.

Senator GRASSLEY. It is not very easy to answer my next question, and I don't suppose it is such a hard question, but we have

had a lot of polls and the most recent one that I would quote would

a be the Times-Mirror poll. Eighty-two percent of the people thought in some areas we need stricter laws and stricter regulations to protect the environment.

Now, of course, you always have to assume that a poll is accurate, and I suppose that is a very big assumption, but how do you find the reaction of people in some of these very specific areas fitting into the current reform movement that we have? You know, the same people might say government red tape is too big a problem and we have got to do something about it.

Mr. FERRARA. Senator, let me try to take a stab at this. You know, when they ask a question like that, it depends on how they-you can see vastly different results in polls, depending on how you phrase the question. The people you are asking are going to hold the Congress and their elected officials responsible for the bottom line. They may not know why it is that their recently graduated son or daughter can't get a job. They may not know that it is due to some environmental regulation. They may not know why they are having higher inflation and higher prices. They may not know that there is some regulatory requirement causing that.

But in the end, they are going to look at the bottom line and they are going to look at the performance, and that is what they are going to hold people accountable for. So I would submit that where you have these egregious regulatory requirements that are harming society on net that they will see the beneficial results if

you take a positive move like you see in this proposed legislation.

I think during the Reagan years you saw the beneficial economic results of the deregulatory policies that were going on, and the public approved what was going on and rewardedI think it is clear-rewarded President Reagan with public support. So I think that is the bottom line to look toward.

Mr. BREGER. I would say the following. Some like myself may have a natural bias against regulation because we have an instinctive distrust of the State. Others may feel that the State is the entity that can do good, that can be paternalist, and look to the state to solve problems. It may be that when this poll is asked, it depends how the question was phrased.

The important point is the following. This argument of whether you like regulation or don't like regulation is really not the argument over S. 343. Remember, S. 1080 was bipartisan-supported. S. 1080 was unanimously supported by 94 Senators because at that point Congress was prepared to say, we are interested in making better regulations, smarter regulations, least restrictive alternative regulations, and this whole issue of making better regulations and smarter regulations had not been turned into a partisan cat fight.

It seems to me that even a Senator who says I like regulations, I look to the State as a paternalist helper, should be saying let's only regulate when the benefits to society exceed the cost; let's only regulate in the least restrictive way.

So while I can appreciate this particular poll and the sentiments that it has, I don't think it applies to what you and others are trying to do and Senator Dole is trying to do in S. 343.

Senator GRASSLEY. Do you see the same constitutional problems with the 45-day Congressional oversight provision that Mr. Gellhorn made reference to?

Mr. BREGER. Subject to going and reading the Constitution again, I do not. I think you may want to make some technical changes in the language. I am not sure you would want to talk on page 17, 626(b)(1), of failing to override the veto of the President. You may want to refer to it as failing to override the President's return of the legislation. But I think that the bicameral clause is met because you have two Houses of the Congress voting on the joint resolution, and the presentment clause is met. It is presented to the President for him to respond to.

Mr. FERRARA. I have nothing to add to that. I generally agree with what he said.

Senator GRASSLEY. I think this will be my last question. The administration, I think, is confused about section 628 regarding the codification of Chevron. They argue that significant administrative decisions could be upset that have been considered settled law. Do you see these problems, either one of you?

Mr. BREGER. I am not sure I understand what they are talking about. I would have to know what particular decisions they are referring to. In general, Chevron is the law of the land—not in general; in specific, Chevron is the law of the land and it is followed by most courts for over a 10-year period. So I am not sure how they could take the position that significant decisions would now be overturned by the use of the Chevron doctrine.

Senator GRASSLEY. I would have to say in our contact with the administration, they weren't very specific with us either as to what specific administrative decisions might be upset as a result, so we don't know either.

I thank each of you for participating. We will probably continue to be in touch with you. Thank you very much.

Mr. FERRARA. Thank you.
Mr. BREGER. Thank you, Mr. Chairman.
Senator GRASSLEY. The hearing is ended.
(Whereupon, at 11:48 a.m., the subcommittee was adjourned.]

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