President Bush's nominee to head OMB's Office of Information and Regulatory Affairs (OIRA), John Graham, has demonstrated consistent hostility to protections for public health, safety and the environment over his career. In particular, the Senate Committee on Governmental Affairs, which will hold a confirmation hearing on May 17, should consider the following areas of concern: Ideological opposition to regulation. As director of the Harvard Center for Risk Analysis, which is heavily funded by corporate money, Mr. Graham has been a consistent and reliable ally of almost any industry seeking to hold off new regulation. For instance, after receiving funding from AT&T Wireless Communications, Mr. Graham produced a study in July 2000, that argued strongly against a ban on the use of cell phones while driving – which was being considered by many cities and states at the time. He’s also downplayed the health risks of diesel engines, as well as second-hand smoke, and argued against a ban on highly toxic pesticides (all after receiving funds from affected industries). In a talk at the Heritage Foundation, Mr. Graham said that “[e]nvironmental regulation should be depicted as an incredible intervention in the operation of society.” This fierce, ideological opposition to new regulation causes great concern that OIRA will take a much more activist role in the rulemaking process, reminiscent of the 1980s when the office came under heavy criticism from Congress for continually thwarting crucial public protections. Questionable analytical methods. As head of OIRA, Mr. Graham will be in position to enforce and set guidelines for cost-benefit analysis across federal agencies. It is important then to examine his past work in this area to determine the direction he would point government agencies. The record – recently critiqued by Lisa Heinzerling, a professor at the Georgetown University Law Center – suggests Mr. Graham would seek to implement questionable analytical methods that have the effect of deflating benefits relative to costs. For instance, Mr. Graham and one of his doctoral students, Tammy Tengs, evaluated 587 life-saving measures, finding outrageously high costs for most environmental protections. Although most of these measures were never actually implemented by a federal agency – and thus tell us little about our real-world regulatory system – it is nonetheless instructive to examine how Mr. Graham arrived at his figures. First, as Heinzerling points out, Mr. Graham focuses exclusively on fatalities, and ignores other impacts, such as morbidity, effects on ecosystems, and equity considerations. Next, Mr. Graham monetizes benefits by focusing on life-years saved (as opposed to the number of individual lives saved, as is commonly practiced). He also assumes no benefit until the first life-year is saved. In other words, prevention of cancer, which has a long latency period, is credited with no immediate benefit when it is first implemented. Mr. Graham then discounts the value of life-years saved in the future by 5 percent each year from the point the first life-year is expected to be saved. To use Heinzerling’s example, a regulation that, on average, prevents fatality at the age of 35 would save 42 life-years assuming a life expectancy of 77 years. Discounting 5 percent from each life-year starting at age 36, the “present value” of the 42nd life-year saved would be approximately 1/8 of a year. This approach has the effect of dramatically deflating benefits relative to costs, particularly those that derive from cancer prevention, which is primarily a disease of old age, and thus saves fewer life-years. Indeed, toxin protections will almost inevitably appear cost-ineffective under this approach. Accusations of “statistical murder.” Mr. Graham has provocatively accused the federal government of “statistical murder” for its current regulatory policies. As a remedy, he advocates “comparative risk analysis” in which environmental regulation, for instance, is compared to auto safety regulation. Such a comparison of costs and benefits across regulatory programs, Mr. Graham contends, should inform the executive branch where to regulate and where to scale back activities. As Mr. Graham told the Columbus Dispatch, “The failure to compare the costs of toxin control rules to rules on health care and injury prevention and to allocate resources based on those comparisons is resulting in ‘statistical murder.’” There are many problems with this idea, but the notion that the federal government is committing “statistical murder” is flat wrong. This rhetorical recklessness – which cultivates the image of the government killing people through irrational regulation – assumes a fixed national budget for risk reduction, where a dollar spent on Risk A means a dollar less to spend on Risk B. This is not how government operates. The United States has a $9 trillion economy, of which only a tiny fraction is devoted to risk reduction. If there are substantial risks that need to be addressed, we should do so. But the reason we haven’t addressed these risks has absolutely nothing to do with addressing other less substantial risks. Mr. Graham surely understands this. Yet the fact that he promotes a different understanding of the regulatory system raises serious questions about whether he would seek to install some sort of regulatory budget as administrator of OIRA, which Congress has rejected in the past. A misleading study. In pushing his case for comparative or relative risk analysis, Mr. Graham has often invoked a second study he conducted with Tammy Tengs. “[B]ased on a sample of 200 programs, by shifting resources from wasteful programs to cost-effective programs, we could save 60,000 more lives per year in this country at no additional cost to the public sector or the private sector,” Mr. Graham told the Committee on Sept. 12, 1997. This has been one of the most widely cited studies in the debate over regulatory reform, and has often been used to paint a picture of out-of-control federal agencies. Yet it contains significant flaws. Most striking, 79 of the 90 environmental “regulations” considered by Mr. Graham were never actually implemented; most of these, not surprisingly, were scored as outrageously expensive. Thus, Mr. Graham’s study tells us virtually nothing about the regulatory system as it actually exists. The study does make mention of this, but in his many public presentations, Mr. Graham has never made this clear. And despite repeated misrepresentations by the press and members of Congress, Mr. Graham has never bothered to correct the record. In fact, he has perpetuated the myth by continually using the study to criticize our real-world regulatory system. Views on cost-benefit analysis at odds with Congress. Mr. Graham has taken the view that cost-benefit analysis should be the determinative criteria in deciding whether a rule goes forward. This position is frequently at odds with congressional mandates that place public health considerations as the preeminent factor in rulemaking deliberations. This past summer, for instance, Mr. Graham filed an amicus brief before the Supreme Court arguing that EPA should consider costs in devising clean air standards. The Court, however, unanimously rejected this argument, finding, in Justice Scalia’s words, that the Clean Air Act “unambiguously bars cost consideration from the [standard]-setting process, and thus ends the matter for us as well as EPA.” As OIRA administrator, Mr. Graham will act as gatekeeper for agency rules. This raises concern that in this role he will elevate the role of cost-benefit analysis in ways Congress never intended. Lack of experience with information issues. OIRA was created in 1980 by the Paperwork Reduction Act, which gives the office chief responsibility for overseeing information collection, management, and dissemination. Mr. Graham has little to no experience with information issues, which have taken on even greater importance with the advent of the Internet. We fear that information policy will suffer with Mr. Graham at the helm, and that he is more likely to focus on regulatory matters – his natural area of interest and expertise. Ironically, Congress has never asked OIRA to review agency regulations. This power flows from presidential executive order.