Editor's Note: This post was originally published as a comment in response to "Turning Rule Writers Into Problem Solvers: Creating a 21st Century Government That's Open and Competent by Improving Regulation and Regulatory Review" on Cairns Blog. Additionally, a correction was made in this version regarding the number of comments EPA received in response to its TRI rollback rule during the Bush administration.

The three ideas for reforming participation in the rulemaking process in Beth’s Noveck's blog post, "Turning Rule Writers Into Problem Solvers: Creating a 21st Century Government That's Open and Competent by Improving Regulation and Regulatory Review," may or may not be useful. They certainly can and should be tested empirically. But the focus on these participation issues must be complemented by reform of the rulemaking process itself.

There are numerous problems with the process. A mainstay of our current rulemaking approach involves comparing costs and benefits. Yet most often, federal agencies end up relying on the regulated community’s estimate of its compliance costs. When cost estimates originate from the regulated community, they are likely to have biased outcomes – especially when there is no way to verify them. Since all decisions about the regulation start with these numbers, we are building a house on a faulty foundation. Moreover, these cost estimates are never tested once the regulation is put into place, even though there is ample evidence that implementation costs go down with technological innovations and other market-based solutions.

If rulemaking is guided by cost and benefits, why is there no assessment for the cost of delay? Not looking at the cost of delay harms the public but benefits the regulated community. If we don’t look at the cost of delay, there is little incentive for action.

Under today’s rulemaking approach, participation is skewed. Small businesses and state/local/tribal governments get special access to discuss proposed rules before the public does. When there is an opportunity for selected audiences to interact with agencies at the expense of other audiences, such as beneficiaries, it raises questions of fairness. It also contributes to a perception that special interests have taken over the rulemaking process – and if not a takeover, then certainly a cozy relationship, such as the relationship that existed between the former Minerals Management Service and the energy industry.

The amount of analysis and paperwork associated with a rulemaking that an agency must go through has become absurd. Through organic statutes, Congress often requires analyses – and each administration tends to add more analytical requirements (often without eliminating old ones). The result is what some experts call “paralysis by analysis,” which, of course, tilts the regulatory playing field in favor of inaction.

I could go on listing the problems with the rulemaking process, not to mention the lack of public education in our schools about administrative government and civic participation. Technology may play some role in making things better, but fundamental policy reform is even more essential.

Additionally, technology solutions skirt the reality that politics play in rulemaking decisions. During the Bush administration, EPA received more than 122,000 comments opposing efforts to reduce data collection under the Toxics Release Inventory (TRI) and only a handful supporting EPA’s effort. Yet EPA moved forward with its proposed gutting of the TRI program. Why participate in a rulemaking process that may be rigged from the start? It fosters disenchantment and discourages meaningful participation.

Beth’s third idea raises concern about who would participate in providing alternative ideas with empirical data to support the idea. Certainly average citizens do not have the technical expertise for such efforts, and most nonprofits don’t either. Most likely, it would be Big Oil, Wall Street, and other regulated special interests that would have the resources to provide the empirical support for ideas. They already do that now. While there should be pilot projects to test Beth’s ideas, let’s not get giddy about technology suddenly changing all power dynamics. Technology may provide tools to help, but it is not necessarily the solution.

Maybe it is coincidental that 2012 is an election year, and it appears that President Obama is suddenly using the rulemaking process as a tool to reach out to the business community. But since last week’s new regulatory policy directives that Beth describes, we’ve seen decisions on regulations that seem to benefit corporate interests. For example:

• On Jan. 18, rules under the H-2B Visa Program, a program that improved the process for setting wage rates employers must pay to temporary foreign workers, came out. But the implementation was delayed until at least 2012.
• On Jan. 19, OSHA backed off a proposed workplace noise rule in response to complaints from major business groups.
• On Jan. 21, FDA withdrew its draft guidance on menu-labeling regulations and instructed states and localities to hold off on enforcement until a final federal rule is published.
• On Jan. 25, OSHA suspended its proposed rule to restore a tracking mechanism on employer injury and illness logs for work-related musculoskeletal disorders.

In each of these cases, there may be legitimate – even rational – reasons to slow down or scotch the regulation. But if a perception grows that the Obama administration is capitulating to business interests over public interests, the best public participation approaches in the world are not going to result in a stronger democracy.