1150 Seventeenth Street, N.W., Washington, D.C. 20036
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Many critics of the Bush administration suggest that our present evils--the housing bubble and aftermath, the collapse of financial markets, escalating health care costs, the failures of the automobile industry--can all be traced to a reckless deregulatory focus that permeated the administration of George W. Bush. Others, however, consider this
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something of a just-so story and are not persuaded that the Bush administration was seriously focused on deregulation.
Discussing the myths and realities of deregulation during the Bush 43 years will be D. C. Searle Senior Fellow Christopher DeMuth, who, during the Reagan administration, served as administrator of the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget; Susan E. Dudley, OIRA administrator from January 2007 to January 2009; and economist John F. Morrall, who spent two decades at OIRA. AEI resident scholar Kenneth P. Green will both contribute remarks and moderate the discussion.
| 8:30 a.m. |
Registration and Breakfast | |
| 9:00 | Panelists: |
Christopher DeMuth, AEI |
| Susan E. Dudley | ||
| Kenneth P. Green, AEI | ||
| John F. Morrall | ||
| 11:00 | Adjournment |
WASHINGTON, MAY 7, 2009--The George W. Bush era was often referred to as a time of rampant deregulation, with detractors blaming environmental and financial woes on its lack of willingness to create or enforce regulations. On May 6, AEI held a conference to explore these issues; there, former officials from the Office of Information and Regulatory Policy (OIRA) explained that "deregulatory" is a hard concept to define and that by the most concrete definitions, the Bush administration continued expansionary regulatory trends.
The OIRA administrator for the last two years of the Bush administration, Susan E. Dudley, argued against common assertions regarding the Bush administration's deregulatory bent. Using data from the Mercatus Center, she explained that regulatory spending and staffing actually rose faster during the Bush administration than during the Clinton administration. Much of this was due to homeland security spending, but there were also major new initiatives in other sectors: Dudley mentioned Sarbanes-Oxley and new regulations on workplace safety, mercury, fuel economy standards, and energy efficiency. As she noted, the Bush administration attempted--particularly at first--to reduce the regulatory burden associated with new source review, family leave, and the Endangered Species Act. In each of these, it failed.
AEI's D. C. Searle Fellow, Christopher DeMuth, contrasted his experiences in Reagan's OIRA with his impression of the Bush administration. He argued that while Democrats tend to promote new regulations and Republicans are less active but acquiescent, both Reagan and Bush represented breaks from this pattern: Reagan as "the great exception: an enthusiastic deregulator," and Bush as a big-government conservative. DeMuth explained that Bush tried to win over new constituencies, such as Hispanics and the elderly, with big regulatory initiatives in education and prescription drugs. "The No Child Left Behind statute looks just like the Clean Air Act: lofty but very vague language about objectives and goals," DeMuth said. "If you fail, you get more money, not less."
DeMuth explained that the Bush administration's response to crises like the terrorist attacks of 9/11 and the recent financial meltdown were also "highly interventionist and regulatory." DeMuth described the president as "a strong moralist . . . [who] tended to see issues as matters of good and evil"--very different from other recent Republican presidents.
AEI's Kenneth P. Green noted that it seemed like in the Bush administration tried early on to streamline some energy production processes, particularly increasing domestic fossil fuel and nuclear production, largely without success. He then offered a quick review of the energy regulations under Bush: during the Bush administration, there were major new regulations for hot water heaters, boilers, air conditioners, commercial refrigerators, and various other goods. The projected benefits appeared to be large, but with massive margins of error; the costs tended to be uncalculated. This is a general problem with new regulation cost-benefit analysis: it is performed by the agencies rather than oversight bodies, and the numbers that come out of it may not reflect the actual costs and benefits, making cross-administration comparisons even more difficult.
The easiest metrics for whether deregulation is occurring is the growth of pages in the Federal Register, cost estimates for new regulation, and regulatory staff levels. By all of these, the Bush administration was not deregulatory. These are not perfect metrics--as Green noted, a regulation modifying and defanging a previous regulation will still involve adding pages to the Federal Register. Overall federal staffing levels can also disguise cuts happening at the agency level. However, there is no question that the Bush administration was not deregulatory in the sense that the Reagan administration was. As DeMuth said regarding the Reagan administration's abolition of the Fairness Doctrine and removal of oil price controls: "That was deregulation."
--ABIGAIL HADDAD
Christopher DeMuth is the D. C. Searle Senior Fellow at AEI and was president from December 1986 through December 2008. He was previously managing director of Lexecon Inc., a law and economics consulting firm; editor and publisher of Regulation magazine; administrator for regulatory affairs at the Office of Management and Budget and executive director of the Presidential Task Force on Regulatory Relief in the Reagan administration; a lecturer and director of regulatory studies at Harvard's Kennedy School of Government; an attorney with the Consolidated Rail Corporation and with the law firm of Sidley & Austin; and a staff assistant to President Richard M. Nixon. He is a director of the State Farm Mutual Automobile Insurance Company and two family firms. Mr. DeMuth's essays have appeared in The American Enterprise, Harvard Law Review, Yale Journal of Regulation, the Wall Street Journal, Commentary, and other publications.
Susan E. Dudley was the administrator of the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget from April 2007 to January 2009. At OIRA, Ms. Dudley was responsible for the review of draft executive branch regulations; the collection of federal-government-wide information; the development and implementation of government-wide policies in the areas of information policy, privacy, and statistical policy; and international regulatory cooperation efforts. Prior to OIRA, Ms. Dudley directed the Regulatory Studies Program at the Mercatus Center at George Mason University, where she also taught courses on regulation. Earlier in her career, Ms. Dudley served as an economist at OIRA, as well as the Environmental Protection Agency and the Commodity Futures Trading Commission, and was a consultant at Economists Incorporated.
Kenneth P. Green studies public policy with respect to air pollution and climate change, energy and the environment, transportation and the environment, and environmental chemicals as a resident scholar at AEI. His work includes analysis of Canadian environmental policy. He has authored numerous policy studies, newspaper and magazine articles, several encyclopedia entries and book chapters, and a textbook for middle-school students entitled Global Warming: Understanding the Debate (Enslow Publishers, 2002). Mr. Green has worked on both U.S. and Canadian policy, first at California's Reason Foundation, then for nearly three years at British Columbia's Fraser Institute.
John F. Morrall is an economic consultant specializing in regulatory impact analysis. From 1989 to 2008, he served in the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB), serving as acting deputy administrator and branch chief from 2006 onward. While at OIRA, he was responsible for reviewing the regulations and regulatory impact analyses issued by the departments and agencies of the federal government and was the lead author on OMB's annual Report to Congress on the Costs and Benefits of Federal Regulations. Previously, he served in other capacities at OMB; was a visiting economist at AEI; and taught at the University of North Carolina, the University of Florida, and American University. He has been published in the Journal of Risk and Uncertainty, Economic Inquiry, and the Journal of Regulatory Economics, among others.
