Senators hear of successful process to streamline regulations’ costs

WASHINGTON  — Senators heard testimony Tuesday about Canada’s success at controlling the burden of regulations on citizens and businesses through the use of a “one-in, one-out” rule. “What we’re trying to do is change the culture,” said the Honorable Tony Clement, a member of Canada’s Parliament who oversees that country’s regulatory process. Such a change would ensure that legislators and regulators truly understand the costs of the rules they impose.  

Sen. Ron Johnson (R-Wis.), who led the rare two-committee joint hearing as chairman of the Senate Homeland Security and Governmental Affairs Committee (HSGAC) along with Sen. Mike Enzi (R-Wyo.), chairman of the Budget Committee, said that such a cultural change is needed. In Washington, Johnson said, “everything seems to be additive. And over the decades, we have added layer upon layer upon layer – I could keep going – of law and rules and regulation.” He noted that credible estimates of the federal regulatory burden now reach nearly $2 trillion a year, a figure approaching the same league as all health care spending. While controlling health care costs is a national priority, he said, “Where’s the outrage, where is the sense of urgency about trying to control a $2 trillion regulatory burden?” 

Besides Clement, the two committees also heard testimony from Susan Dudley, former head of the federal Office of Information and Regulatory Affairs, and Richard J. Pierce, a professor of law at George Washington University. 

Clement testified that Canada’s requirement that an agency proposing new regulatory costs identify and remove an equal amount of outdated regulations has not proved difficult for regulators. “So far, there’s been no issue,” he said. Agencies anticipating new rules have even culled old, ineffective rules to prepare. 

“So this has really created a cultural shift, a discipline to the process,” Johnson said. 

“The normal go-to position always had been, ‘If we only pass this regulation, that issue will go away,’” Clement said. “And what we’ve done is we’ve created a cost to that kind of thinking, because now they’ve got  to think about what regulations they want to remove from the books.” 

The rule has also compelled regulators to revisit the results of their rules and to consult with businesses about how best to remove regulations that impose high burdens for little benefit, said Clement. 

“I don’t think anybody makes the point that all regulations are bad,” said Johnson later. “I think that most of us think that regulations are very good and they provide a clean environment and worker safety, and all those things are good. But there’s a point of diminishing returns,” after which the accumulated burden and arbitrary enforcement create crippling uncertainty for employers.    

The full hearing video can be seen here