Opinion: Waging the War Over Regulation

By David Vladeck

ublic Citizen Litigation Group

At least since the virtual coronation of Ronald Reagan as president, the prevailing mythology has been that our federal regulatory agencies are careening out of control, placing needless and unwarranted burdens on American business that stifle economic growth. This mythology was hardly put to the test in the presidential election. Both candidates accepted as gospel that notion that regulation is mushrooming beyond reason, and both embraced the rhetoric of further “reform.” Vice President Al Gore went so far as to make the wacky pledge that he would not add a single position to the federal regulatory agencies, no matter what.

So if the anti-regulation forces have won the rhetorical battle about regulation, why is the war over regulation still being waged? For one simple reason — because our society needs sensible regulation. The facts are these: Preventative regulation is cheaper than after-the-fact fixes; good regulation avoids expensive litigation and counterproductive blame-laying when bad products fail; smart regulation results in the development of better and more efficient products; and above all else, reasonable regulatory measures save lives and preserve our environment.

Due to massive cut-backs in the Reagan-Bush years, which continued at a slower rate during the Clinton administration, we are now actually facing a crisis of under-regulation. Our federal regulatory agencies have been cut to the bone. As a result, the pace of regulation has slowed to the point where serious, acknowledged health and safety threats go unregulated, to the peril of those exposed, and enforcement efforts are crippled by inadequate resources.

Take the Occupational Safety and Health Administration, often the poster child of the anti-regulatory forces. Today, OSHA’s staffing has been so severely cut that it has fewer than 100 people working on developing workplace standards for the thousands of toxic substances used in the workplace and for the untold safety hazards that lurk in chemical plants, factories, and manufacturing facilities. Because of this bare-bones staff, the Clinton administration did far less in terms of promulgating new standards than any past administration. Highly toxic and carcinogenic substances — such as hexavalent chromium, a metal used widely in auto-making, manufacturing and metal plating — are essentially unregulated, even though hundreds of thousands of American workers are exposed to them every day on the job and even though their serious health effects are beyond dispute. This is but one example of regulatory work that desperately needs to be undertaken but will not be completed for years.

Consider the Food and Drug Administration, the consumer’s main line of defense against ineffective drugs, unsafe medical devices, and tainted food and cosmetic products. With fewer than 10,000 employees nationwide, the FDA regulates one-quarter of the American economy. It is not surprising that with mandates from Congress to speed drug reviews, the FDA has had to do triage on its other priorities. As a result, it took the agency four years to enact a simple rule to protect children from the worst poisoning risk they face — the iron tablets that their parents take. Each year, 100,000 children are made ill, some quite seriously, because they mistake their parents’ vitamins for candy. The FDA wanted to impose rules to redesign the packaging of these products to protect children. But with all of the obstacles that are placed in any agency’s rulemaking path, the process was so slow that more than four years elapsed, while children remained at risk.

Perhaps the easiest way to see the problem of under-regulation is to look at the recent Ford-Firestone tire recall. The National Highway Traffic Safety Administration is a tiny agency, with only 625 employees to regulate the entire motor transportation industry. Its resources are stretched so thin that, if the industry is less than candid with the agency, as many say both Firestone and Ford were, there is little NHTSA can be expected to do about it, and tragedies like the one we see unfolding are bound to recur. What should be done to prevent these mishaps in the future?

First, we need to unshackle our regulatory agencies. The rulemaking process, which was designed to respond swiftly to emerging health and safety threats, has become so encrusted with procedures that it now takes OSHA an average of eight years to issue a new standard! Opponents of regulation have paralyzed the rulemaking process by layering on multiple new requirements that agencies must meet in order to issue new rules. Before taking even the first step of publishing a proposal, agencies must obtain approval from the Office of Management and Budget to gather data; conduct mini-cost/benefit analyses; meet with representatives of small business; consider the possible impacts on entities as diverse as local governments and Indian tribes; and ultimately must get OMB clearance to proceed. Then, as the rulemaking progresses, agencies must again consult with a wide array of “stakeholders,” perform numerous “impact” analyses, and satisfy OMB as to the economic rationality of the rule. All of these analytical steps take time, and, while the agencies diligently produce this mountain of paperwork (much of which goes unread), the public remains unprotected from the risks of children being poisoned or workers being exposed to known carcinogens. If one were to subject the current procedure-laden regulatory process to cost/benefit analysis, it would flunk. We need to streamline the regulatory process and let our health and safety agencies do their jobs.

Second, we need to restore resources to these agencies. The idea that fewer than 2,200 OSHA employees can inspect our nation’s six million workplaces, design and implement new standards and enforce the law is silly — just as the notion that 625 NHTSA employees can effectively police the auto industry. If we want the things that regulation can bring us — safer cars, effective drugs, pure foods and less dangerous workplaces — we need to restore the ability of our agencies to do their work.

And finally, we need to end the pointless rhetoric about the horrors of regulation. To be sure, in any system as complex as ours, one can point to regulatory efforts that seem unproductive or counterproductive. Take airbags. Despite the current controversy over the safety of airbags for persons of small stature and children, would any of us really conceive of letting our kids drive a car without an air bag? I surely wouldn’t. The fact remains, regulation spares us needless death, injury, suffering and expense.

Consider the alternative. Suppose the regulatory state withered away, as its critics say they would like to see. The only discipline on the market would be the tort system, and we would depend on jury verdicts to provide disincentives to manufacturing unsafe cars. What sense does it make to have only an after-the-fact system that is designed principally to compensate injured people? Compensation is very important but surely is no substitute for a regulatory system that is designed to prevent injuries before they occur. But the controversy still rages. It is time to recognize that, although not perfect, the regulatory system is and will remain society’s first line of defense, and the time has come to fortify it, not tear it down.

David Vladeck is director of the legal arm of Public Citizen, a consumer advocacy organization founded in 1971 by Ralph Nader.