By Lisa Heinzerling

Originally posted on Think Progress

In his new book, “Simpler: The Future of Government,” Harvard law professor Cass Sunstein writes about his nearly four years as President Barack Obama’s “regulatory czar.” As the Administrator of the Office of Information and Regulatory Affairs (known as “OIRA”) within the Office of Management and Budget, Sunstein oversaw the regulatory output of the many agencies of the executive branch. Rules on worker health, environmental protection, food safety, health care, consumer protection, and more all passed through Sunstein’s inbox.

Some never left. A group of Department of Energy efficiency standards, for example, have languished at OIRA since 2011, as has an Occupational Safety and Health Administration rule to finally reduce exposure to the silica dust that sickens workers every year.

In his revealing book, Sunstein tells us why: It is because he, Sunstein, had the authority to “say no to members of the president’s Cabinet”; to deposit “highly touted rules, beloved by regulators, onto the shit list“; to ensure that some rules “never saw the light of day”; to impose cost-benefit analysis “wherever the law allowed”; and to “transform cost-benefit analysis from an analytical tool into a “rule of decision,” meaning that “[a]gencies could not go forward” if their rules flunked OIRA’s cost-benefit test.

Assertive intrusions into agencies’ prerogatives — prerogatives given by law to the agencies, not to OIRA — were necessary, Sunstein insists, because otherwise agency decisions might be based not on “facts and evidence,” but on “intuitions, anecdotes, dogmas, or the views of powerful interest groups.” In Sunstein’s account, OIRA’s interventions also ensured “a well-functioning system of public comment” and “compliance with procedural ideals that might not always be strictly compulsory but that might be loosely organized under the rubric of ‘good government’.” No theme more pervades Sunstein’s book than the idea that government transparency is essential to good regulatory outcomes and to good government itself.

The deep and sad irony is that few government processes are as opaque as the process of OIRA review, superintended for almost four years by Sunstein himself. Few people even know OIRA exists; in fact, the adjective that most often appears in descriptions of this small office is “obscure.” Even fewer people know that OIRA has effective veto power over major rules issued by executive-branch agencies and that the decision as to whether a rule is “major” — and thus must run OIRA’s gauntlet before being issued — rests solely in OIRA’s hands. Most people, I would venture to guess, think that the person who runs, say, the Environmental Protection Agency is actually the Administrator of the Environmental Protection Agency. But given OIRA’s power to veto rules, the reality is otherwise: In the rulemaking domain, the head of OIRA is effectively the head of the EPA.

This state of affairs poses several problems. Two have to do with law. One problem is that laws on workplace health, environmental protection, food safety and other protections give agencies — like OSHA, EPA, and the FDA — the authority to make rules. They do not give this authority to OIRA. No statute, in fact, gives OIRA the power to review agencies’ rules. This power today derives, instead, from a set of executive orders issued by Presidents Clinton and Obama. But it is a large question whether a law giving rulemaking authority to one part of government is properly construed as giving authority to another part of government, designated by the President. Most agree that a statute giving authority over food safety to the FDA does not allow the President to turn that power over to the Department of Agriculture. It is a little hard to see why that same statute can be interpreted to turn the power over to OIRA.

Another legal problem with the current process of OIRA review is that OIRA imports a cost-benefit framework into statutes that do not allow this framework. The Clean Air Act, for example, requires EPA to set national air quality standards for various air pollutants based only on the scientific evidence of the level at which such pollutants are harmful. The Supreme Court, in a unanimous 2001 ruling authored by Justice Scalia, held that the law does not permit EPA to take costs into account in setting these standards. But OIRA nevertheless requires cost-benefit analysis of these standards. And, in perhaps the most prominent assertion of control over agency prerogatives in this administration, President Obama directed then-EPA Administrator Lisa Jackson to withdraw a revised air quality standard for ozone, citing “the importance of reducing regulatory burdens and regulatory uncertainty, particularly as our economy continues to recover.” It is difficult to understand this decision, with its focus on regulatory burdens and economic circumstances, as anything other than a flouting of the Clean Air Act. Notably, while Sunstein describes President Obama’s decision as “unquestionably correct,” “made on the merits,” and “not motivated by politics,” he nowhere explains exactly why he thinks the decision was correct or consistent with the law.

Similar, but more subtle, intrusions by OIRA on the legal authority of agencies involve not disregarding clear statutory commands but pressing agencies to interpret ambiguous commands so as to allow cost-benefit analysis. In an important decision almost thirty years ago, the Supreme Court held that where an administrative agency is interpreting a statute that is ambiguous, the courts should defer to the agency’s interpretation as long as it is reasonable. This idea, known as the Chevron doctrine after the case that announced it, means that agencies often have a large range of discretion in interpreting the statutes under which they operate. Under Sunstein, OIRA has stepped into that range and pressed agencies to adopt cost-benefit analysis as their decision-making framework wherever the law does not unambiguously preclude it.

To understand the boldness of OIRA’s power grab, we need to consider a bit of history. In 1994, eyeing the first Republican takeover of the House of Representatives in forty years, Newt Gingrich proposed an aggressive series of legislative reforms, bundled together as the “Contract With America.” Among the most contentious of the proposals was the “supermandate”: a requirement that all rules protecting human health, safety, or the environment pass a cost-benefit test. Critics of what President Bill Clinton dubbed the “Contract On America” feared that applying a cost-benefit test to health, safety, and environmental rules would often spell their doom, as these rules produce benefits — in human health, in longer life, in cleaner air and water and land — that are hard to quantify and even harder to monetize. President Clinton vetoed bills to fund the government in part because they contained the supermandate, leading to the government shutdowns of 1995 and likely contributing to Clinton’s political renewal.

Thanks to Sunstein, though, the supermandate is back. By pressing agencies to adopt cost-benefit analysis as a decision-making framework wherever the law allows it, Sunstein’s OIRA has, by executive fiat rather than legislative enactment, imposed a cost-benefit supermandate wherever the law is ambiguous (which it often is). Newt Gingrich might be pleased, but those concerned with health, safety, and environmental protection should not be.

A third problem with OIRA is its unaccountability. In Sunstein’s rendering, OIRA gathers information from all corners of the executive branch: White House economic offices, the White House Chief of Staff, Cabinet heads, career staffers in OIRA and in other agencies, and many others all kibitz on rules under review at OIRA. But where everyone is responsible, no one is accountable. Indeed, in a recent article, Sunstein himself has insisted that — despite his book’s tall talk of “shit lists” and saying no — he really didn’t have much power at all. When a rule ends up on the “shit list,” then — after an agency has spent time and resources developing it, based on its best understanding of its legal obligations and the factual evidence before it — who is accountable? No one, it seems — because everyone is.

OIRA also undermines accountability by working in the dark. Although the Clinton-era executive order that outlines the OIRA review process sets out many requirements for transparency, President Obama’s OIRA follows almost none of them. Contrary to the executive order, OIRA does not explain to agencies, in writing, that items on their regulatory agenda do not fit with the President’s agenda; it does not keep a publicly available log explaining when and by whom disputes between OIRA and the agencies were elevated; it does not ensure that agencies clearly explain any changes made to a regulatory package at OIRA’s behest; and it does not (with the one exception of the ozone standard) return rules to agencies with a written explanation about why they have not passed OIRA review. On the latter point, agency heads might fairly wonder whether any of the items on Sunstein’s “shit list” include any of their own rules; the contents of the list appear, like so many things about OIRA, to be a secret.

If this is the future of government — legally suspect, politically unaccountable, preternaturally secretive — I’d like to think we can do better.

Lisa Heinzerling is a Professor of Law at Georgetown University Law Center and member scholar and founding board member, Center for Progressive Reform. The author was Senior Climate Policy Counsel to EPA Administrator Lisa P. Jackson from January to July 2009, and Associate Administrator of the EPA Office of Policy from July 2009 to December 2010.

Copyright © 2013 Center for American Progress Action Fund. This piece was reposted from Think Progress with permission.