Posts Tagged ‘administrative agency’
October 10th, 2011 at 5:45 pm
The “Upstream” Approach to Regulatory Reform

According to an article in the journal Regulation, there are two ways to regulate the flow of administrative agency rules.  The “downstream” approach tries to “rein in onerous regulations after they have been promulgated.”  The “upstream” method allows Congress “to restrict administrative agencies before giving them rulemaking authority during the legislative process.”  The idea is to get fewer and less costly regulations with five key reforms:

1)      Require agencies to review existing regulations for inefficiency at a set time after implementation (which sounds like something similar to Texas’ Sunset process)

2)      Require agencies to eliminate duplicative rules if a new regulation would supersede an older one

3)      Limit the total number of regulations during implementation of any new law (an attempt to make rule writers more cautious when spending their regulatory chips)

4)      Establish a regulatory “pay-as-you-go” that rescinds one old rule for every new rule implemented (the authors also argue for a proportionality requirement that ensures against an economy-killing rule replacing a forgotten restriction no longer necessary)

5)      Prohibit new regulations where costs exceed benefits

The key perk of the last proposal is requiring agencies to engage in a formal cost-benefit analysis during the implementation phase.  That helps put the agency on record – and the voting public on notice – of the true impact about to hit before it’s too late.

Check out the short (4 page), tightly-argued article here.

H/T: Cato Institute