From cost-benefit guidelines to the new draft policy on risk assessments, White House regulatory czar John Graham has steadily proceeded with a long-range plan laying the groundwork for dramatic limits on public safeguards.

In light of this long-range agenda, the White House's recent Proposed Risk Assessment Bulletin, already problematic in its own right, is also troubling as the latest element in a sequence of policy changes designed to undermine protective policies by making regulatory league tables possible.

Endgame: Rationing Regulatory Protections Through League Tables

Graham is a champion of anti-regulatory league tables. Long before his tenure in the Bush administration, Graham advocated (misleadingly) the use of tables that, like league standings charts in the newspaper sports page, would rank regulatory protections according to cost-effectiveness ratios.

Graham's position has long been that such tables could be the basis for selecting among potential regulatory protections. In the FY 03 budget submission, Graham reiterated that position. Graham cautioned that the dream of using league tables for interagency comparisons of regulations "depends on achieving a degree of analytical consistency across agency evaluations of health and safety risks" -- that is, to have interagency consistency of the "data" that would be plugged into such tables.

Regulatory Budgeting

One use of league tables would be in regulatory "budgeting," an industry dream policy that would limit the fictional compliance costs that an agency is allowed to impose through new regulations in any given year. Once an agency hits its pseudo-budget cap for compliance costs, it would be forbidden from promulgating any new protective standards.

Risk/Risk Comparisons

Another use for league tables would be as a decision-making tool that supplants precautionary approaches with risk-vs.-risk tradeoffs. As Graham explained the approach in OMB's 2003 regulatory accounting report, precautionary regulation supposedly creates new risks of its own:

For example, regulations that reduce the level of disinfection byproducts in the water supply may reduce potential adverse health effects from by-products of the disinfection process. However, it may also reduce the effectiveness of disinfection and thereby increase the health risk from microorganisms. Likewise, restricting latex use to prevent allergic reaction in health care workers may increase the risk of infections that latex products are used to prevent.

Having slickly shifted the conversation away from polluters and other corporate malfeasors and onto regulatory protections themselves, Graham thus co-opted precautionary discourse and turned it into a basis for new analytical limitations: "Therefore, precaution may be necessary on both sides of the equation and a formal consideration of risk-risk trade-off may be necessary when both risks cannot be easily reduced in tandem." League tables make such "risk-risk trade-off[s]" possible.

The Graham Agenda

Ever since explaining the agenda in 2002, Graham has been working incrementally to make league tables possible:

• His first move was mandating consistency in cost-benefit analysis and requiring that agencies conduct cost-effectiveness analyses.

   

• His most recent move was the Jan. 9 release of the Proposed Risk Assessment Bulletin. Graham signaled his intention to systematize risk assessment information four years ago in the 2002 annual regulatory accounting report, in which he called for both (1) the application of Safe Drinking Water Act risk assessment standards to all assessments and (2) "methods of risk assessment that supply central estimates of risk as well as upper and lower bounds on the true yet unknown risks." The latter is particularly important for league tables: risk assessments typically report ranges of risk probabilities, but league tables need a single risk figure in order to produce clear rankings. The new proposed risk assessment bulletin now advances both goals announced in 2002.

   

• The same week that the proposed risk bulletin was released, the National Academies of Sciences' Institute on Medicine released a White House-commissioned report on measuring health benefits for use in cost-effectiveness analysis. The NAS report now serves as an authoritative commentary agreeing with what could likely be next from Graham: a new guideline mandating greater consistency in the use of mortality and morbidity measures, such as a quality-adjusted life years, in cost-effectiveness analysis. Such a policy would be the final step needed to establish consistent analytical approaches that, in turn, will make league tables possible.

More about league tables:

• Richard W. Parker, Grading the Government: How Reliable are the Tests?

   

• Lisa Heinzerling, Five Hundred Life-Saving Interventions and Their Misuse in the Debate Over Regulatory Reform

   

• Lisa Heinzerling & Frank Ackerman, The Humbugs of the Anti-Regulatory Movement

   

• Lisa Heinzerling, The Perils of Precision

   

• Lisa Heinzerling, Reductionist Regulatory Reform