William Roth

Mr. ROTH

Mr. ROTH. Mr. President, I make a point of order a quorum is not present.

Mr. ROTH. Mr. President, an effort has been made to use scare tactics to insinuate, to suggest, to expressly assert that those of us who are supporting meaningful regulatory reform are somehow trying to prevent appropriate action being taken in the case of matters that affect the health, the safety of the American people or the environment. Time after time, statements have been made that we cannot take action to protect the American people from E. coli, admittedly a serious problem. The reason I say it is scare tactics is the fact that the legislation before us very clearly deals with the situation. In fact, the legislation proposed, the so-called Dole-Johnston amendment provided, that a major rule may be adopted and may become effective without prior compliance with this subchapter if ``(A) the agency for good cause finds that conducting cost-benefit analysis is impracticable due to an emergency or health or safety threat or a food safety threat that is likely to result in significant harm to the public or natural resources.'' So I think it is important to understand the basic legislation anticipated that there could be situations where there were serious threats to health and safety, and because of the need for action, an exception would be made to the general rule of requiring a cost-benefit analysis. Let me point out further that that language does not require that it be an emergency to fall within this exception, because the language specifically provides that there is an exception to the rule requiring cost-benefit analysis in the case of, first, an emergency that stands on its own feet--just the word ``emergency''--or health, that likewise stands on its own feet. So it does not need to be an emergency as long as it is a question of health. And the same thing, of course, could be said about a safety threat or a food safety threat. So that is point No. 1. But yesterday action was taken because of concern expressed by the Secretary of Agriculture that there was a problem with respect to a rule involving E. coli. So because of that concern expressed by the Secretary, as well as the many statements that were made in the media, the press, the Senate adopted an amendment proposed by the majority leader that modified the language of which we just spoke and in which it expressly includes an imminent threat from E. coli. The language now reads: A major rule may be adopted and may become effective without prior compliance with this subchapter if (A) the agency for good cause finds conducting a cost- benefit analysis is impracticable due to an emergency or health or safety threat or a food safety threat (including-- This is the new language-- (including an imminent threat from E. coli bacteria) that is likely to result in significant harm to the public or natural resources. . . . This legislation was adopted by a unanimous vote, and Senators, both Republicans and Democrats, made it very clear that it was not an attempt in any way to prevent or threaten the issuance of a rule affecting E. coli. Subsequently, there were concerns expressed again by the Secretary of Agriculture that the legislation unanimously adopted yesterday did not cover two situations that he saw as being burdensome or troublesome. One was that under the amendment yesterday, it did not exempt his being required to take or make a risk assessment under subchapter 3 of the legislation, and that as part of the risk assessment, it would become necessary to have a peer review. Such peer review, the assertion was made, might delay the issuance of the rule by as much as 6 months. So, once again, we are here on the floor seeking to allay this concern. And that is, of course, the purpose of the Johnston-Hatch-Roth amendment. Under the Johnston-Hatch-Roth amendment, two steps are taken. It is specifically provided that a new risk assessment for the final rule need not be made if the final rule is substantially similar to the proposed rule. In other words, when you propose a major rule, there has to be a risk assessment made. And so if the situation is such that the final rule is very similar to the proposed rule, under this legislation, it would not be necessary for a new risk assessment to be made. So that takes care of the problem. In fact, I point out to my distinguished colleagues that this legislation or this proposal, this amendment, very substantially modifies the burden on agencies because this modification not only applies to E. coli, but is a general rule, so that any time in the future when the [[Page S 9755]] final rule, the final major rule, is substantially like the proposed rule, a new risk assessment would not have to be made for the reasons I have already mentioned. The amendment, of course, goes further and provides that notwithstanding any provision of the Comprehensive Regulatory Reform Act of 1995 and the amendments made by such act, including section 9 of such act, any rule for which a notice of proposed rulemaking was filed before April 1, 1995, shall not be subject to the provisions of this subchapter or subchapter 3, except for section 623 relating to review of rules. As I understand it, the proposed notice of proposed rulemaking in the case of E. coli was back in February, so the fact that this paragraph exempts any rulemaking where the notice of proposed rulemaking was filed before that date, again, ensures that action can be taken in the case of E. coli. So I congratulate the Senator from Louisiana for his authorship of this legislation and I think, once again, we have addressed the problems that have been raised. I suspect that tomorrow, we will have some new problem because of the efforts on the part of some to use scare tactics. Mr. President, I am concerned that the pending regulatory reform legislation, S. 343, has been poorly understood and mischaracterized at times. This legislation, the product of bipartisan compromise, the work of four committee chairmen, including myself, is vitally important to restoring some common sense in the regulatory process. Simply put, the Dole-Johnston compromise would require regulators to issue regulations whose benefits justify their costs, unless existing statutory instructions prevent that. This legislation will lead to a more efficient, a more effective regulatory process. But a number of recent statements misconstrue this legislation. I have, of course, just been addressing the misinterpretations, the scare tactics that have been used in the case of E. coli, which is a good example of the recent statements that have been made that are misconstruing this most important piece of legislation. Let me take a few minutes to address some of these myths. First, S. 343 would not roll back environmental standards and does not--and I underscore the word ``not''--contain a supermandate. Section 624 of S. 343 contains the cost-benefit decisional criteria. Section 624 clearly states that the cost-benefit requirements shall supplement and not supersede another existing statutory instruction. Section 624 merely requires regulators to pick a regulation whose benefits justify its costs, unless the statute authorizing the rule does not allow such an option. This is, in my judgment, just plain common sense. Now, S. 343 also gives fair and equal treatment to environmental considerations and nonquantifiable benefits. The definition of benefits in section 621(2) clearly shows that in determining whether the benefits of a rule justify its cost, an agency should consider environmental, social, and health benefits. The agency also does not have to quantify all costs and benefits. Nonquantifiable factors count, too. S. 343 merely calls for a reasoned decision from the agency as to whether the benefits of a rule justify its cost, considering all relevant costs and benefits. I might just point out the importance of the word ``justify.'' It does not mean that benefits have to outweigh costs. The word ``justify'' is much less strict than that. Now, to deal with emergencies where an agency must issue regulations quickly to respond to immediate threats to human health, safety, or the environment, S. 343 contains emergency exemption from risk assessment and cost-benefit requirements in sections 632(c)(1)(A) and 622(f). S. 343 will not roll back environmental standards. S. 343 will not cause undue litigation and will not clog the courts with lawsuits. S. 343 has limited judicial review. In fact, it does not allow the normal level of judicial review that applies to laws as a matter of due course under section 706 of the Administrative Procedures Act. Section 625 of S. 343 provides that an agency's failure to comply with S. 343 may only be reviewed by a court in the context of the whole rulemaking record under the very, very, deferential ``arbitrary and capricious'' standard. A court cannot overturn a rule because an agency fails to comply with some unimportant procedure in doing a risk assessment or cost-benefit analysis. In other words, a court cannot nit-pick an agency for minor procedural missteps in doing the required analysis. Only if an agency's failure to comply with S. 343 is so glaring as to render the rule arbitrary and capricious can a court overturn a rule. Three, the process for reviewing old regulations under S. 343 will not overload the agencies or clog up the courts with litigation. Section 623 of S. 343 is designed to allow for the reform or elimination of inefficient, outdated, or ineffective rules already on the books. Again, this is a commonsense solution. We should look at the old rules that do not make sense and try to reform them. Leave the other rules alone. Section 623 allows each agency to choose any rule it thinks should be reviewed and place them on a review schedule. The agencies have up to 11 years to review these rules and decide whether they should be continued, reformed, or terminated. In addition, a petitioner can request that the agency review any overlooked major rules within the first 3 years of the schedule. But to limit the number of petitions, S. 343 requires any petitioner to meet a very high burden of proof. That is, that there is a substantial likelihood that the rule should not meet the cost-benefit test in section 624 of the legislation. This is a heavy burden of proof that will require substantial supporting documentation. But if a petitioner cares enough about a poorly written rule to prove that the benefits do not justify its cost, or that it otherwise fails the cost-benefit decisional criteria, why should we not review that rule? Mr. President, section 623 is a fair, workable, and sensible solution to the thorny issue of reviewing existing rules. In sum, Mr. President, when we look closely at how S. 343 would work, we can see it would achieve its intended goal--a more efficient and effective regulatory system. It will give us more bang for the buck, allowing Americans to achieve greater benefits at less cost. S. 343 will benefit everyone while providing needed protection for the environment, health, and safety. S. 343 will provide smarter regulation. I yield the floor. Mr. FEINGOLD addressed the Chair.

Mr. ROTH

Mr. ROTH. Can we agree there will be no second-degree amendments on this amendment?

Mr. ROTH. Mr. President, as I understand it, the intent is that I only lay down the amendment at the present time. I yield the floor.

Mr. ROTH. Mr. President, I make a point of order a quorum is not present.

Mr. ROTH. Mr. President, I suggest the absence of a quorum.

Mr. ROTH. I ask the distinguished Senator from Ohio whether it might not be possible on my amendment, which has been cosponsored by Senator Biden, that we might not reach a time agreement on that.

Mr. ROTH. We will just lay it down tonight.

Mr. ROTH. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. ROTH. Mr. President, I send an amendment to the desk and ask for its immediate consideration.

Mr. ROTH

Mr. ROTH. Mr. President, I suggest the absence of a quorum.

Mr. ROTH. Mr. President I support the current amendment to raise the dollar threshold for major rules from $50 to $100 million. I support this amendment because it would help ensure that this bill will work for us, not against us. The purpose of S. 343 is to ensure better, more rational regulations and to reduce the regulatory burden while still ensuring that important benefits are provided. S. 343 aims to restrain regulators from issuing ill-conceived regulations. It requires better analysis of costs, benefits, and risks, so that regulators will issue smarter, more cost- effective regulations. This is common sense reform, not rollback. We want agencies to work for the public's best interests, not against them. But we cannot so overburden the agencies with analytical requirements that they cannot properly carry out their mission to serve the public. That is why we need a dollar threshold before requiring regulators to subject rules to detailed analysis--cost-benefit analysis and risk assessment. Costly rules, of course, merit detailed analysis. But less costly rules do not. The reason is simple. Cost-benefit analysis and risk assessment are themselves costly and time-consuming. This is why, since cost-benefit analysis was first required by President Ford over 20 years ago, it only applied to major rules costing over $100 million. Every President since then, including Presidents Carter, Reagan, Bush, and Clinton, have used the $100 million threshold for required cost-benefit analysis. This same threshold had strong precedent in the Senate. S. 1080, supported by a vote of 94 to 0 in 1982, [[Page S 9698]] had a $100 million threshold. In addition, S. 291, the Regulatory Reform Act of 1995, which I introduced in January and which received the unanimous support of the Governmental Affairs Committee, had a $100 million threshold. We also should keep in mind that the current value of this $100 million threshold, set in 1974, is actually far less than $50 million in 1974 dollars. A $100 million threshold makes sense because those costly rules account for about 85 percent of all regulatory costs. Yet, there are a limited number of such rules--about 130 rules per year for nonindependent agencies. This means that the vast bulk of the regulatory burden can be put under control with a roughly predictable, and more importantly, manageable analytical burden. There is no good reason to have a lower dollar threshold for major rules. A $50 million threshold would sweep in many more rules but make it all the more difficult for the agencies to handle the analytical burden. We just do not really know how many new rules a $50 million threshold would capture. Even more troubling to me have been recent attempts to further burden the agencies--which would already be pressed hard by the requirements of S. 343--with more analytical requirements beyond those of the $50 million threshold. The recent Nunn-Coverdell amendment, for example, will dramatically increase the burdens imposed by S. 343. It would sweep into the definition of major rule all rules that have a significant impact on a substantial number of small businesses, as defined by the Regulatory Flexibility Act. This could add many hundreds of additional rules, including some very small rules, to the cost- benefit and petition process of S. 343. I am deeply concerned about the burdens imposed on small business. But the Nunn-Coverdell amendment threatens to sink an already heavily loaded ship. Raising the major rule threshold to $100 million is not enough to cure the overload problem confronting S. 343, but it will help to lighten the load. It will help make this bill a more workable and more effective bill for the American public. It is good government. I urge my colleagues on both sides of the aisle to support this important amendment.

Mr. ROTH

Mr. ROTH. Mr. President, I would like to announce for the information of the Senate and the public that the Permanent Subcommittee on Investigations of the Committee on Governmental Affairs will hold hearings regarding abuses in Federal student grant programs proprietary school abuses. This hearing will take place on Wednesday, July 12, 1995, in room 342 of the Dirksen Senate Office Building. For further information, please contact Harold Damelin of the subcommittee staff at 224-3721.

Mr. ROTH

Mr. ROTH. Will the distinguished Senator yield a moment on that point?

Mr. ROTH. I wanted to make a statement on what happened in the committee.

Mr. ROTH. All right.

Mr. ROTH. Mr. President, what the distinguished Senator from Louisiana has just said is exactly on point. What we are seeking to do is to make this a cleaner environment for all people. What has happened too often by scare tactics is that we find actions being taken that are unnecessary and unwarranted. The Senator is absolutely right. There is language already in the proposed legislation that will take care of these emergencies where there is a threat to health and safety. And there is no way. It is totally impossible to eliminate where all of those threats are going to arise in the future. That is the reason for the general language that, where there is an emergency or a problem of health and safety, an exemption, an exception, is made to the requirements of the legislation. But the basic purpose of the legislation is to ensure that we do a better job of regulating, of eliminating the risks and problems faced by this Nation. It is already costing every American family something like $6,000 a year. We need to ensure that those dollars are well spent, that we get the biggest bang for the buck. Just let me point out that what exists in this legislation also existed in the moratorium. The moratorium provided that the President had the right to exempt health and safety regulations from the moratorium. That would include various diseases, E. coli or whatever else might be of emergency nature. The important point was that when the Republicans voted the way they did they were relying on the general language. I do not care how many amendments we add. I support the amendment of the distinguished majority leader. But legally, it is not necessary. Would not the Senator from Louisiana agree with that?

Mr. ROTH. I could not agree more. I personally intend to support the amendment of the distinguished majority leader. But the important point is that in this legislation we want to deal with not only the threats we face today but we face in the future. That is the reason for the general legislation. Who knows what horrible disease may develop sometime in the future. That is the purpose of the language in this legislation. So I just want to say I agree with what the distinguished Senator from Louisiana said. It was exactly the same situation when we were dealing with regarding the moratorium. We had general language to cover health and safety. We gave the President the authority to exempt it. There was no need for it. That is the reason many of the Senators voted as they did. Several Senators addressed the Chair.

Mr. ROTH

Mr. ROTH. First, Mr. President, I want to say how strongly I agree with my distinguished colleague, the senior Senator from Ohio, when he speaks about the need for a bipartisan approach to obtain regulatory reform. I want to say that I hope we can continue to work together as we did in the Governmental Affairs Committee to move forward legislation that accomplishes the goals that I think we all seek on both sides of the political aisle. Mr. President, I want to congratulate Senator Abraham for his contribution in offering this amendment. I strongly agree with him that there is no area of activity more adversely affected by some of the regulatory reform actions of the past than small business. I think we all agree that small business in many ways is the most important part of our economy as it is the primary area that results in growth in our economy and, most importantly, is the area where the majority of jobs are being created. So, again, I want to congratulate the junior Senator from Michigan for his contribution in proposing this most important amendment. This amendment would strengthen the lookback provisions of section 623. It would provide a mechanism for adding rules adversely impacting small businesses to the agency schedules for reviewing rules. As the amendment was originally drafted, it would have allowed the Chief Counsel for Advocacy at the Small Business Administration to have sole discretion to add small business rules to the agency review schedules. To respond to concerns about political accountability and the need for standards in selecting rules for review, Senator Abraham has revised his amendment. I believe this revision is a balanced solution to a very important problem. One of my concerns was that, in providing this discretion solely to the Chief Counsel for Advocacy at the Small Business Administration, the original amendment was a delegation of an extraordinarily broad power. Since the Chief Counsel for Advocacy at the Small Business Administration is, as the Senator from Michigan pointed out, semi- independent in the same sense that inspectors generals are independent, it gave tremendous authority for this individual to take whatever action he or she thought was appropriate in requiring rules to be reviewed. As revised, the Abraham amendment would ensure more political accountability regarding which small business rules are added to agency review schedules. Small business rules could be selected jointly by the Chief Counsel of Advocacy for the Small Business Administration and the Administrator of the Office of Information and Regulatory Affairs. Alternatively, the Administrator of OIRA alone could choose small business rules for review. This would ensure that the Administrator of OIRA, a politically accountable official who also understands the burdens on the agencies, will be involved in the process. In addition, the revised amendment makes clear that the standards applicable to other rules selected for review apply to the small business rules. For example, the Administrator of OIRA and the chief counsel must consider, in selecting a small business rule for review, whether review of the rule will substantially decrease costs, increase benefits, or provide flexibility. Mr. President, I believe that Government must be more sensitive to the cumulative regulatory burden on small business. As I said earlier, small business is, indeed, the backbone of America, a crucial provider of jobs, a wellspring of entrepreneurial innovation and a central part of the American dream. And again I congratulate Senator Abraham for his hard work to help America's millions of small businessowners, their employees, and their families. I urge my colleagues to support this amendment. Mr. President, I yield back the floor.

Mr. ROTH

Mr. ROTH. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. ROTH. Mr. President, I want to take a moment to talk about the small business amendment to S. 343 offered by Senator Nunn and Senator Coverdell. This amendment would, of course, modify the definition of ``major rule'' to include rules that have a significant impact on small business and small governments as provided in the Regulatory Flexibility Act. This would have the effect of requiring all reg-flex rules to be subject to cost benefit analysis and the decisional criteria, as well as to be subject to the petition process for reviewing rules. Mr. President, as I have said before, I am deeply concerned about the impact [[Page S 9629]] of the regulatory burden on small business. Indeed, that is exactly why I support the amendment offered by Senator Abraham earlier today. The Nunn amendment in its present form does raise some serious problems. I had hoped we could use an approach for this amendment similar to the Abraham amendment. So far, we have not been able to reach that agreement. While I believe strongly in the need for regulatory reform, it must be reform that is workable. I fear that, as drafted, this amendment could place too heavy a burden on the agencies, which are already pressed by the many other provisions of S. 343. This amendment does not distinguish clearly between costly rules which deserve detailed analysis, and smaller rules which should not be subject to time-consuming and expensive analysis. I hope that we can work together to address the concerns about the workability of this amendment, concerns shared by many of my colleagues. I would welcome the opportunity to use some of the good ideas in the Abraham amendment, such as giving OIRA greater responsibility in selecting rules for analysis, or to pursue other suggestions offered by my colleagues. I yield the floor. I suggest the absence of a quorum.

Mr. ROTH

Mr. ROTH. I would be pleased to do so, as I know of the considerable interest of the Senator from Alaska in continuing to see to it that the Alaska Railroad remains one of the premier transportation systems for Alaska. The adoption of amendment No. 1444 authorizes any State that does not have Amtrak service as of the legislation's enactment date, to use the mass transit account of the highway trust fund for capital improvements to, and operating support for, intercity passenger rail service. This means that congestion, mitigation, and air quality funds, as well as Surface Transportation Program funds will be eligible for the State of Alaska to use for its State railroad.

Mr. ROTH

Mr. ROTH. Mr. President, I have been a longtime advocate of streamlining government and making it more effective to address the challenges of the global economy and information age as we move into the 21st century. While I have focused on these issues for many years as chairman and former ranking Republican of the Governmental Affairs Committee, I have never witnessed as great an interest in this critical issue than I have this Congress. I welcome this interest because I believe it offers great opportunity to achieve major and overdue structural reform of the executive branch. We can and will achieve the goal of smaller, better, and less costly government. Most recently, attention has centered on eliminating the Commerce Department. It is endorsed as part of the budget resolution. The proposal introduced recently by Senator Abraham, the majority leader, and others provides a specific plan on how to dismantle the Department. I have long endorsed the idea of dismantling the Commerce Department in the context of elevating, streamlining, and reconfiguring major trade functions in the executive branch. It is very difficult to defend the status quo as it exists today at the Commerce Department, and I believe the initiatives that have been introduced are an important step toward the establishment of a government that is structured to deal effectively with the challenges of tomorrow, not yesterday. I have worked on organizational issues for many years and I realize how difficult it is to bring about needed and constructive change. Turf usually overwhelms the process, whether it is in the administration or Congress, and the private sector is often either unexcited about the issue, or they don't want to upset those with whom they have to work in the current structure. So it is not surprising that the recent legislation is controversial and that the trade provisions have engendered the greatest amount of concern. I, too, have concerns about certain provisions. I would like to turn briefly to some of the trade concerns that have been raised in the initial debate on this issue so far. First, I firmly believe a vast majority of us agree on the vital importance of trade to this Nation and recognize that our Government plays a crucial role in this area. This role includes performing key functions as negotiating agreements to open markets, enforcing and implementing trade agreements, administering trade laws and facilitating exports. For many years now, I have called for significant reform of executive branch trade functions and the case for reform has never been stronger than today. Uniting major trade responsibilities under the clear leadership of one person and establishing a more effective trade voice for our Nation is the direction in which we should head. It is time to recognize that much of the Commerce Department's trade activities are integrally involved with those of the USTR. There is no clear dividing line between them, except for the divided lines of authority. This has caused, and continues to cause, wasteful duplication of effort, confusion as to who is in charge, serious turf battles, and divide-and- conquer tactics by our trading partners. It is time that they become part of the same team with one coach in charge. I have heard some disturbing accounts of how our trading partners take advantage of our divided trade leadership. For example, I've been told of instances where the lead trade negotiator from one of our fiercest trading partners would play the USTR and Commerce trade negotiators off one another by telling one that the other was willing to agree to something that the other would not agree to. Ambassador Kantor's recent testimony before a House Appropriations subcommittee demonstrates the blurred nature of responsibilities between the International Trade Administration [ITA] and the USTR. He stated that the USTR's three top priorities are to ensure that the Uruguay round agreements are implemented fairly, to enforce trade agreements, and to expand trade to new markets that offer the greatest potential for increased exports of American products. That sounds a lot like what much of the ITA is doing. I have an extremely high regard for the dedicated and talented staff at the USTR, but it is unrealistic to expect that they can continue to manage effectively a trade agenda that is ever more demanding and complex, under the current structure of divided trade leadership and responsibility. The fact [[Page S 9472]] that there are some 40 detailees at the USTR--about 25 percent of its current size--is indicative of the burdens the current structure is working under. Furthermore, it is my understanding that two major components of ITA--the international Economic Policy and Trade development offices spend about one-half of their time on trade negotiations and policy development. While we need to maintain a coordinating function on trade that allows for input from different parts of our government that may be impacted by a particular trade matter, the USTR relies mostly heavily on ITA for negotiating support and backup. Even Commerce's main export promotion entity, the U.S. And Foreign Commercial Service, is actively supporting the USTR. For example, it plays an important role in the USTR's annual National Trade Estimates Report. There is logic behind bringing Commerce and USTR trade functions together under one cabinet- level voice. I would like to comment briefly on some of the concerns that have been raised with respect to merging these functions. One major concern is related to moving import Administration functions to the USTR because of possible trade-offs that might be made between trade negotiations and administration of our trade laws. I would simply make two points in this regard. The first point is that the administration of antidumping and countervailing duty laws is a quasi-judicial process and must be implemented strictly according to law. The second point is that these functions are already part of a department that has trade advocacy as one of its primary function, something which one could argue would exert more pressure for trade-offs than would negotiations. It is my understanding that Commerce's Office of Import Administration is kept separate from other trade functions and that is how it should remain under any single trade structure. At the same time, we should recognize that, while the administration of these laws must be isolated from other primary trade functions, these issues are in fact part of trade negotiations--they were a major issue in the WTO and are an active part of past and current free trade talks. Other strong concerns have been raised about the USTR's role as an honest broker and interagency coordinator. While I appreciate some of the concerns that have been raised, and I agree that there must be an honest broker in the White House at the highest levels on major trade decisions, it is not the USTR that seems to be performing that role. As far as I can tell, every President has created his own small White House office to broker controversial trade decisions. Ambassador Kantor has himself testified that of the three tiers of the interagency coordinating mechanism, and I quote, ``(a)t the highest level is the National Economic Council (NEC).'' At the lower levels, there is no reason why the USTR or a single cabinet trade structure should not perform the lower level interagency process that exists. Things have dramatically changed since the USTR, then the STR, was created in 1962. We are no longer simply negotiating occasional GATT rounds of tariff talks. While we have made some organizational changes along the way, they have been relatively limited in scope, and the last time we made any significant change was in 1979. Since then, our trade negotiating agenda has taken center stage and has grown tremendously. The issues are much broader and more complex than ever before, and the implementation of trade agreements has also grown enormously in significance. Our Government's foreign commercial presence is often on the front lines in discovering trade problems that might need to be negotiated or are related to lack of implementation of certain agreements. Our current institutional structure that divides these and other major trade functions among separate entities is not, I would argue, in our national trade interest. It is in our national trade interest to restructure trade functions in a way that builds on and improves the best features that exist. We want to preserve the lean and mean negotiating structure of the USTR and to also ensure that there is an effective interagency and private sector advisory process that allows for legitimate input from other agencies and voices as needed. But our negotiators should have the necessary support structure in place to achieve ambitious negotiating objectives. We also should be implementing and administering trade agreements and trade programs in one house. There is not a whole lot of sense, for example, to the USTR administering the GSP program, while Commerce implements major bilateral trade agreements such as the semiconductor agreement. The specific business concerns that have been raised about the trade provisions of the Commerce Dismantling Act must be examined very closely, and the Committee on Governmental Affairs will be holding hearings on these and other aspects of the bill after the July recess. I share some of the concerns that have been raised, including those relating to the international economic policy and trade development functions of the Commerce Department. I also believe greater consolidation should be accomplished. A cabinet level trade structure should include, for example, the Commerce Department's existing export control functions. Mr. President, citizens are demanding a government that works better, as well as costs less. An integrated trade structure within our Government will not only work better for our citizens, but it will also achieve efficiencies, synergies and cost savings. In closing, I would just to like to say that there is a window of opportunity here to reflect in a comprehensive way about how we should be organized to address the many trade challenges ahead of us. I hope we can prevent jurisdictional concerns from becoming the driving force in this debate, and that we move it instead in a positive and constructive direction. I look forward to working with my colleagues to achieve the best trade structure for our country, one which will promote an effective national trade agenda for the 21st century.

Mr. ROTH

Mr. ROTH. Mr. President, the suggestion has been made on this floor earlier today that regulatory reform is primarily a matter of trying to satisfy the needs of special interests. Nothing could be further from the truth. I think it is fair to say that is recognized on both sides of the political aisle. I was pleased to note that the distinguished ranking member of the Governmental Affairs Committee and former chairman, Senator Glenn from [[Page S 9353]] Ohio, in his opening statement noted that . . . when the press writes about what happened on the floor today, they [should] get away from the idea that this is the ultimate in confrontation, which seems to be what the questions lead to when we go out of the Chamber--talking about regulatory reform--because, today, I would hope the message would go out that we are united in the Senate of the United States, Democrat and Republican, on one thing: We need regulatory reform. Those words are echoed by the distinguished senior Senator from Michigan, who is also a member of the Governmental Affairs Committee, in his remarks yesterday on the floor of the Senate. He said: Let me commend all those involved in this effort. It is a very complicated effort, and most importantly perhaps, an essential and bipartisan effort. He goes on later in his statement to say that: We need regulatory reform. We must have cost benefit analysis. We need risk assessment. But we also need to be sure that what we are achieving protects, in a sensible way, the environment and the health and the safety of the people of the United States. With that, I can strongly agree. And I would agree with those who have said that our air is cleaner, our water is cleaner and safer, and our environment is better because of many of the regulations. But, at the same time, there has been recognition by many that the regulatory maze does not work in the best interests of environmental protection or good government generally. Mr. President, yesterday I stood to speak on behalf of the Dole- Johnston compromise. I outlined how this legislation, S. 343, the Comprehensive Regulatory Reform Act of 1995, is a real and workable solution to the overbearing Government regulation that threatens America's future. I cited the costs of such regulation and the need to restore balance to the regulatory process. And I explained that I support this legislation because it will make the Federal Government--our regulatory agencies--more efficient and effective in carrying out their responsibilities. The simple fact is, Mr. President, that if we reduce Government waste and inefficiency, we ultimately will improve, not hinder, Government programs, including environmental protection efforts. If we reduce the costs of regulation, we have greater resources to do more good than before. For example, it has been estimated that a reallocation of resources to more cost-effective programs could save an additional 60,000 lives per year at no additional cost, or the same number of lives we are currently saving could be saved for $31 billion less. So I think it is only fair to say that there is plenty of room to improve our regulatory system. I personally could not support an effort to gut environmental protection. But strong reform is something I can support. To say that the benefits of regulation should not justify its costs is to argue for irrational and wasteful regulation. Senator Dole's compromise bill broadly defines benefits and costs. It is not a black-box approach that reduces everything to dollars and cents. This bill allows agencies to consider nonquantifiable benefits and costs. And the definition of benefits expressly includes favorable environmental and social effects. The agencies are given leeway to consider all of the benefits and costs that are relevant to making a responsible regulatory decision. Mr. President, there is another important reason why I support this legislation. I support it because I am concerned that the rising costs of regulation are undermining the faith of the American people in Government; I believe these overbearing costs are, in a very real way, undermining support for the environmental movement. Americans treasure the beauty of this country; they value a clean environment. But in last November's elections, the American people also clearly demanded a government that is balanced--a government that is dedicated to common sense and workable solutions in achieving environmental protection and economic security. In short, they demanded a government that is efficient and effective. I believe our countrymen are right to demand this fundamental change, and all of us involved in the current debate must respond to their request. We must recognize that we cannot regulate a totally risk-free world or remove every last molecule of pollution. But we can, and should, use our resources wisely to achieve the greatest benefits at the least cost. We can, and should, continue to be a world leader in environmental protection while still having a healthy economy and a high standard of living. We have reached a point where there is broad and bipartisan support for regulatory reform and the tools to achieve it. In his thoughtful book, ``Breaking the Vicious Circle: Toward Effective Risk Regulation,'' Justice Stephen Breyer analyzes our regulatory system and concludes that it badly prioritizes the health and environmental risks we face. In the June 1993 Carneigie Commission Report, ``Risk and the Environment: Improving Regulatory Decision Making,'' a distinguished and bipartisan panel of experts concluded that the Nation must develop a more comprehensive and integrated decisionmaking process to set priorities and regulate risks. President Clinton's chief spokesperson on regulatory reform, Sally Katzen, the Administrator of OMB's Office of Information and Regulatory Affairs, submitted a statement to the Governmental Affairs Committee on February 7, 1995, saying: Regrettably, the regulatory system that has been built up over the past five decades * * * is subject to serious criticism * * * [on the grounds] that there are too many regulations, that many are excessively burdensome, [and] that many do not ultimately provide the intended benefits. My friend, George McGovern, a well-known liberal throughout his political career, also testified before my committee about the urgency of regulatory reform. George recounted his experience as a small businessman running an inn after he retired from the Senate. He described how a venture as harmless as running an inn was so burdened by a multitude of complicated and irrational regulations that it failed. he concluded: Doubtless most of these regulations that we chafe under have some benefit. They do benefit somebody; either the public or someone benefits from them in some way. But the big question is are those benefits more than equal to the costs and burdens they place on business, especially small businesses. Justice Breyer, the Carnegie Commission, the Clinton administration, and George McGovern are only a few of the authorities that have recognized the need for regulatory reform. Others include Resources for the Future, the Harvard Center for Risk Analysis, the Brookings Institution, the American Enterprise Institute, and other think tanks, commissions, and independent scholars throughout the country. Without significant reform, the costs of regulatory will only continue to grow. As has already been mentioned on the floor, the total annual cost of Federal regulations has been estimated by Prof. Thomas Hopkins at $560 billion in 1992; it is expected to rise another $100 billion by the year 2000. About 75 percent of that cost increase is due to new risk regulations. These rising regulatory costs have a serious impact on America and the quality of life of our families, businesses, and communities. Let me give you an example: under the Clean Air Act, the State of Delaware was required to implement an enhanced inspection and maintenance--or I/ M--program this year. EPA mandated this program, stating that it would result in significant pollution reductions. However, Delaware environmental officials ran their own data and found that this program would do little to improve air quality in our State. The small reduction in pollution would be overshadowed by high costs and consumer inconvenience at the auto inspection lanes. Delaware has come up with an alternative test that meets the Clean Air Act requirements but is much less costly. This regulatory reform bill would prevent the EPA from mandating burdensome requirements such as the I/M test to the States without making sure that the benefits justify the costs. The problem is, these costs have not been adequately scrutinized in the past. No doubt one reason for this neglect is that these regulatory costs were not constrained by a budget. The decisions to create new regulatory programs typically do not include the kind of serious debate about cost that [[Page S 9354]] is required to create new on-budget programs. Another reason why we have neglected regulatory costs is that most regulations are imposed directly on businesses and governments. This creates the perception that regulatory programs provide free benefits to the public--in contrast to tax-and-spend programs. But the costs of regulations are not simply absorbed by businesses and governments. These costs, of course, are passed on to the American consumer, wage earner, and taxpayer in the form of higher prices, diminished wages, increased taxes, or reduced government services. It is not just big corporations that are being hurt by red tape and bureaucracy; it also is the Federal Government, State, and local governments, small business, and the American public. As I have said, Federal regulations cost the average American household about $6,000 per year. Equally important, we never see the factories not built, the products not made, ah entrepreneurial dreams not realized because, as in the case of George McGovern, they were drowned in the sea of regulatory process. Without a doubt, rising regulatory costs, limited resources, and a desire to preserve important protections and benefits all necessitate a smarter, more cost-effective approach to regulation. Early in this session, I emphasized the need to achieve bipartisan consensus on reforming the regulatory process. I congratulate the majority leader for forging that consensus around his bill with Senators Bennett Johnston and Howell Heflin. Back in February, when I chaired a series of hearings on regulatory reform, Senator Dole came to the first hearing to express his strong desire to restore some common sense to the regulatory process. The leader's commitment to that goal has been critical to the consensus that this bill represents. I also want to thank my other colleagues for their efforts--including Bennett Johnston, Orrin Hatch, Howell Heflin, Frank Murkowski, Kit Bond, Don Nickles, and many others for their significant contributions. The Dole-Johnston compromise bill is aimed at restoring common sense to the regulatory process. I share this goal, along with many Members of the Senate on both sides of the aisle. Indeed, there have been a number of recent initiatives in the Senate to reform the regulatory process. I introduced S. 291, the Regulatory Reform Act of 1995, early in this Congress. S. 291 was a good proposal for regulatory reform, and was unanimously endorsed by the 15 members of the Governmental Affairs Committee. Senator Murkowski also introduced S. 333, a risk assessment bill, that was approved by the Energy Committee. This floor vehicle is an amalgamation of Senator Dole's S. 343, which Senator Hatch guided through the Judiciary Committee, with S. 333 and S. 291. Indeed, as the author of S. 291, I can tell you that the major provisions of S. 291 are reflected in the Dole compromise bill. These provisions include: Cost-benefit analysis: The benefits of a regulation must justify its costs, unless prohibited by the underlying law authorizing the rule. Market-based mechanisms and performance standards: Flexible, goal- oriented approach are favored over rigid command-and-control regulation. Review of existing rules: Old rules on the books must be reviewed to reform or eliminate outdated or irrational regulations. Risk assessment: Agencies must use sound science to measure and quantify risks to the environment, health, or safety. Comparative risk analysis: Agencies must set priorities to achieve the greatest overall risk reduction at the least cost. Reform of the Regulatory Flexibility Act: The Regulatory Flexibility Act is strengthened to make agencies more sensitive to the impact of regulations on small businesses and small governments. Congressional review of rules: Rules will not become effective until they are reviewed by Congress. Congress can veto irrational or ineffective regulations. Regulatory accounting: The Government must compile the total costs and benefits of major rules. Like S. 291, the pending Dole-Johnston amendment has limited judicial review so agency rules will not be invalidated for minor procedural missteps. However, it also improves upon S. 291 by having a more focused cost-benefit test. Regulators must directly set regulatory standards so that the benefits of a rule justify its costs, unless prohibited by the law authorizing the rule. This bill does not override existing law. If the underlying statute does not allow for a regulation whose benefits justify its costs, the Dole-Johnston compromise merely asks the regulator to select the least- cost option among the alternatives allowed by the underlying statute. This should not be a radical idea. I do not believe that the American people think it is radical to ask that the benefits of regulations justify their costs. I urge my colleagues on both sides of the aisle to support the Dole- Johnston compromise to put common sense back into our regulatory process. Our goal in crafting reform should be to strike a balance that is strong but workable. We should keep that goal in mind as the final vote approaches. The floor vehicle may not be perfect, but it is a crucial step forward. I congratulate all those who have played a bipartisan role on this important issue. Mr. President, I yield the floor. Mr. ABRAHAM addressed the Chair.

Mr. ROTH

Mr. ROTH. Some of my colleagues have questioned why I support the Dole-Johnston compromise when the bill I originally wrote received unanimous support in the Committee on Governmental Affairs. The bill I introduced in January, S. 291, the Regulatory Reform Act of 1995, was-- in my opinion--a good proposal for regulatory reform. I am pleased that it received unanimous support from all 15 members of the Governmental Affairs Committee. But S. 291 was itself a compromise. It was, in my view, a good bill, but not a perfect bill. The Dole-Johnston substitute improves upon S. 291 in some key respects, especially the use of a stronger cost-benefit test. I believe, to the extent practical, the benefits of a regulation should justify its costs. The pending amendment is the product of the three committees that proposed regulatory reform legislation, and many other Senators. It likewise may not be perfect from everyone's point of view, but it is a strong effort to make Government more efficient and effective. When you review the key provisions of S. 291, you can see they are reflected in the Dole-Johnston amendment. These provisions include: Cost-benefit analysis: The benefits of a regulation must justify its costs, unless prohibited by the underlying law authorizing the rule. Market-based mechanisms and performance standards: Flexible, goal- oriented approach are favored over rigid command-and-control regulation. Review of existing rules: Old rules on the books must be reviewed to reform or eliminate outdated or irrational regulations. Risk assessment: Agencies must use sound science to measure and quantify risks to the environment, health, or safety. Comparative risk analysis: Agencies must set priorities to achieve the greatest overall risk reduction at the least cost. Reform of the Regulatory Flexibility Act: The Regulatory Flexibility Act is strengthened to make agencies more sensitive to the impact of regulations on small businesses and small governments. Congressional review of rules: Rules will not become effective until they are reviewed by Congress. Congress can veto irrational or ineffective regulations. Regulatory accounting: The Government must compile the total costs and benefits of major rules. Most important, the Dole-Johnston amendment, like S. 291, has limited judicial review so agency rules will not be invalidated for minor procedural missteps. But the Dole-Johnston amendment also improves upon S. 291 by having a more focused cost-benefit [[Page S 9414]] test. Regulators must directly set regulatory standards so that the benefits of a rule justify its costs, unless prohibited by the law authorizing the rule. Of course, neither S. 291 or the Dole-Johnston amendment contains a supermandate that overrides the substantive goals of any regulatory program. The three provisions that lie at the heart of any good regulatory reform proposal are: First, decisional criteria, such as the cost- benefit test; second, judicial review; and third, review of existing rules. The Dole-Johnston amendment is better on the first provision and equal on the second, as I have previously suggested. On the third provision, review of existing rules, it is also better since the provision in S. 291 has significant administrative difficulties. S. 291 said that every major rule on the books had to be reviewed by the appropriate agency within 10 years, plus a possible 5-year extension, or terminate. The basic problem with that approach is what constitutes ``a rule.'' Most rules are amendments to existing programs which upon becoming effective merge into the text of the program. What you have on the books are programs which have been molded by a whole series of prior rules. So how can one mandate that the rules must be reviewed? On which page of the Code of Federal Regulations does a rule begin and end? What grouping of concepts constitutes a rule? A major rule? When 10 years has elapsed, what exactly has terminated? S. 291 meant well, but it was silent on such questions. The Dole- Johnston amendment, in contrast, provides a clearer alternative: the agency establishes a schedule of the rules to be reviewed. This list is published for all to see. Only rules on that list are subject to termination under the legislation. In turn for its workability, however, a vulnerability arises. Suppose the agency list is underinclusive, then what? The Dole-Johnston amendment allows petitioners to request inclusion and, if denied, sue the agency. However, the burden that a petitioner must meet in court is purposefully high, lest any agency be overwhelmed by such petitions. The Dole-Johnston provision is a balanced, workable, and fair resolution of the thorny issue of how agencies are to review existing rules. It is the product of fruitful negotiations with Senators Kerry, Levin, Biden, Johnston, Hatch, Nickles, Murkowski, Bond, and myself. In short, the Dole-Johnston amendment is the newer, better product-- representing the cumulative wisdom of months of negotiations on different options in three committees. When we voted to report S. 291 from the Committee on Governmental Affairs last March, that version may well have been the best text available. But it no longer is. From the day I introduced S. 291 it has been my objective to produce the best possible bill--one that achieves real reform, that passes both Houses, and that is signed into law. From that day I have found myself as the Senator in the middle, serving as a bridge between various opposing viewpoints. I believe that I have been able to achieve significant progress by bringing opposing sides closer together. The policy gap on this legislation has closed and is closing. Today Senator Dole will lay down the Dole-Johnston amendment that represents the current state of progress. Some on the other side of the aisle have introduced a slightly modified version of S. 291. I am somewhat alarmed that this is being done after substantial progress has been made in talks with Senators representing all colors of the political spectrum. I hope that their action does not indicate that their position is hardening on this legislation. S. 291 was a good bill. But the Dole-Johnston amendment is an improvement, thanks in part to suggestions made by those who seek to rally around a modification of S. 291.