Lamar Smith

Mr. SMITH of Texas

Mr. SMITH of Texas. Mr. Chairman, does the gentleman from New York have any time remaining?

Mr. SMITH of Texas. The amendment carves out of the bill essential sectors or regulation and guidance. These include all rules and guidance documents on food safety, workplace safety, consumer product safety, clean water, and clean air. In many cases, these are precisely the agency actions that impose the most cost without producing enough benefits. A good example is the Environmental Protection Agency's recent proposal to control mercury emissions from coal- and oil-fired power plants. EPA estimated that the rule would cost $11 billion annually to achieve; at most, just $6 million in total mercury reduction benefits. That's a cost-to-benefit ratio of almost 1,200:1. Proponents of regulation have nothing to fear from the bill's provisions to prevent excessively costly rules like this. The bill always allows agencies to achieve the statutory objectives Congress has set. Those objectives include protection of food, workplace, and consumer safety, as well as of clean air and clean water. All the bill requires is that agencies consider the cost and benefits of regulatory alternatives and, wherever possible, adopt the least-cost regulation that achieves that goal. If a costlier rule's benefits justify its additional cost and the rule is needed to protect public health, safety, and welfare, the agency may adopt it. The agency just needs to show that the public health, safety, and welfare interest it seeks to protect are within the scope of the statutory provision that authorizes the regulation itself. That is balanced reform that protects public health, safety, and welfare and the American economy and the American taxpayers and the small business owners of America. I urge my colleagues to oppose the amendment, and I yield back the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, I demand a recorded vote.

Mr. SMITH of Texas. Mr. Chairman, I yield myself the balance of my time. One problem in rulemaking is the practice of agencies to negotiate regulations behind closed doors with a few interested parties, then propose and adopt a predetermined rule. To help cure this problem, the bill requires advanced notice of major and high-impact rules that agencies may propose. These are the rules that cost $100 million or $1 billion or more respectively. The advance notice requirement ensures that those who bear the costs of these high-cost regulations have an opportunity to shape agency decisions before they become entrenched in predetermined rulemaking proposals. It also dramatically increases the transparency of the most important agency rulemakings; and, of course, if emergency rules were needed, advance notice may be waived. The amendment, on the other hand, makes advance notice discretionary, not mandatory, with the agencies. That guarantees that advance notice will rarely be used. It eliminates much needed transparency, and it only helps those who negotiate rules behind closed doors, then ram deals through the rulemaking process, ignoring public comment. The amendment may arise from a concern that advance notice not unduly slow down emergency rules. If that is the case, there is no need for concern. Like the existing Administrative Procedure Act, the bill allows agencies to issue emergency rules before they complete ordinary procedure. I urge my colleagues to oppose the amendment. It hurts the bill. It hurts the process. I yield back the balance of my time.

Mr. SMITH of Texas. I am prepared to close; so I reserve the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, I rise in opposition to the amendment.

Mr. SMITH of Texas. Mr. Chairman, I demand a recorded vote.

Mr. SMITH of Texas. Mr. Chairman, I yield myself such time as I may consume. Employers across America face an avalanche of unnecessary Federal regulatory costs. Federal regulations cost our economy $1.7 trillion every year, over $15,000 for each household, according to the Small Business Administration. Yet the Obama administration seeks to add billions more to that cost. The administration's record-setting issuance of major regulations is particularly troubling. By its own admission, the administration's 2011 regulatory agenda contains 200 regulations that typically will affect the economy by $100 million or more every year. For employers, the people who create jobs and pay taxes, the impact of these costly regulations is clear. Government regulation has become a barrier to economic growth and job creation. Faced with huge, new, regulatory burdens and uncertainties about what will come next, employers slow down hiring, stop investing, and wait for a bill from the Obama administration. What enables the administration to issue so many new regulations with so little regard for their costs is the outdated Administrative Procedure Act. Enacted in 1946, the APA's minimal limitations on rulemaking have hardly changed in decades and do nothing to control costs. The Regulatory Accountability Act fixes this problem by bringing the APA up to date. Under its commonsense provisions, agencies are required to assess the cost and benefits of regulatory alternatives. Unless interest of public health, safety, or welfare requires otherwise, agencies must adopt the least-costly alternative that achieves the regulatory objectives Congress has established. The Regulatory Accountability Act has bipartisan support in both the House and the Senate, including from a number of House Democrats who have cosponsored the bill. In large part, this is because its provisions are modeled on the Executive orders that presidents Reagan, Clinton, Bush, and Obama have issued to compensate for the APA's weaknesses. Opponents of the act claim that it requires the benefits of all new regulations to exceed their costs. They argue that as a result the act will prevent Federal agencies from issuing important new public health, safety, and welfare regulations. This is false. The Regulatory Accountability Act only requires agencies to adopt the lowest cost regulatory alternative that achieves the agency's statutory objectives. This assures that agencies will achieve all of those objectives but with much lower costs. Opponents also assert that the act's new procedural requirements will halt all Federal rulemaking, but the act primarily codifies existing Executive order principles and practices under which agencies have been able to issue regulations for years. The act's few additional requirements all are streamlined. They will improve the quality and lower the cost of regulations, but they will not unduly delay them. The act increases the transparency of the rulemaking process with more advance notices of proposed rulemaking, more opportunities for public comment, and more opportunities for public hearings. This will lessen the influence of all special interests. The Regulatory Accountability Act provides the greatest opportunity yet for Republicans and Democrats to join together and lower the job- killing cost of regulations. And it allows costs to be lowered while it assures that all of Congress' regulatory objectives are, in fact, obtained. The bill also provides a clear opportunity for the votes of Democrats in Congress to match President Obama's words on regulatory reform. In his State of the Union address, the President said that ``to reduce barriers to growth and investment, when we find rules that put an unnecessary burden on businesses, we will fix them.'' In Executive Order 13563, the President said that ``our regulatory system must promote economic growth, innovation, competitiveness, and job creation; must allow for public participation and an open exchange of ideas; must identify and use the best, most innovative, and least burdensome tools for achieving regulatory ends; and must take into account benefits and costs.'' The President was right. And the Regulatory Accountability Act does all those things. I urge all of my colleagues to support the Regulatory Accountability Act. House of Representatives, Committee on Oversight and Government Reform, Washington, DC, November 17, 2011. Hon. Lamar Smith, Chairman, Committee on the Judiciary, Washington, DC. Dear Mr. Chairman: On November 3, 2011, the Committee on the Judiciary ordered H.R. 3010, the ``Regulatory Accountability Act of 2011,'' reported to the House. Thank you for consulting with the Committee on Oversight and Government Reform with regard to H.R. 3010 on those matters within the committee's jurisdiction. I am writing to confirm our mutual understanding with respect to the consideration of

Mr. SMITH of Texas. Mr. Chairman, I yield myself 1 minute. Unfortunately, we hear a lot of words that are really irrelevant to the bill that we are considering here today. Once again, let me repeat that the Regulatory Accountability Act only requires agencies to adopt the least-cost regulatory alternative that achieves the agency's statutory objectives. It therefore assures that in all instances agencies will achieve those objectives, whether to protect public health, safety, or welfare or to satisfy some other statutory purpose. The RAA's key contribution is to require that, once agencies have identified means to achieve their statutory objectives, they will simply choose the means that impose the lowest cost. I don't know how anyone could object to that. This creates a positive cycle in which agencies and regulated entities compete to identify innovative, least- cost means to achieve statutory objectives while they simultaneously produce the most benefits. I reserve the balance of my time.

Mr. SMITH of Texas

Mr. SMITH of Texas. I oppose this amendment because it carves out an exception to the bill for regulations under the Food and Drug Administration. If agencies were doing the depth of pre-regulatory analysis they are supposed to be doing under the Regulatory Flexibility Act, then we wouldn't be here today. Small businesses create jobs, and jobs are the key to economic recovery. To help small businesses--like minority-owned restaurants, for example--create jobs, we need to reduce, not increase, the regulatory burden on them. The FDA is not currently exempt from the Regulatory Flexibility Act, so it makes no sense to exempt the FDA from the bill, either. This amendment also would create confusion within the FDA by exempting only its responsibilities under the Food Safety Modernization Act from this bill. There should not be two versions of the Regulatory Flexibility Act in play at the FDA. For these reasons, I oppose the amendment, and I yield back the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, I rise in opposition to the amendment.

Mr. SMITH of Texas. Mr. Chairman, I rise in opposition to the amendment.

Mr. SMITH of Texas. Mr. Chairman, I claim time in opposition to the amendment even though I do not oppose the amendment.

Mr. SMITH of Texas. Mr. Chairman, I support this amendment. The amendment aims to require an agency to account for rules implementing the free trade agreements when the agency considers the cumulative impact of a proposed rule. I support free trade because I believe it is in the best interest of American business, workers, and consumers alike. The gentleman from Pennsylvania and I may differ on this issue, but in the context of this amendment, that is beside the point. It can't hurt to make sure that agencies consider the impact of rules implementing the free trade agreements in their regulatory cumulative impact calculations. I don't think the analysis will show that free trade destroys American small businesses. Quite the opposite is true, in fact. But that isn't a reason not to do the analysis. We should know how these kinds of regulations contribute to the cumulative regulatory burden on small businesses. In conclusion, Mr. Chairman, I do support this amendment and hope to have the gentleman from Pennsylvania's support for the bill on final passage. I yield back the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, I rise in opposition to the amendment.

Mr. SMITH of Texas. Mr. Chairman, I yield myself the balance of my time. The bill only requires agencies to do what common sense and current laws dictate they should be doing right now. The Department of Homeland Security is not exempt from the Regulatory Flexibility Act. Like other agencies, the Department should analyze how a new regulation will affect small businesses before issuing the regulation. If the Department needs to issue a regulation in a true emergency situation, such as one involving national security, it can already do so under the ``good cause'' exception to notice-and-comment rulemaking in the Administrative Procedure Act. This good cause exception would allow the agency to bypass the analysis required by the Regulatory Flexibility Act as well. As written, the amendment would exempt the Department from H.R. 527 but not from the Regulatory Flexibility Act, itself. The result of this would be two versions of the Regulatory Flexibility Act at play in the Federal Government--one for the Department and one for everyone else. Small businesses do not need any more confusion and uncertainty when they are trying to participate in the Federal regulatory process. For these reasons, I oppose the amendment, and I yield back the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, I rise in opposition to the amendment.

Mr. SMITH of Texas. Mr. Chairman, we are prepared to close; so I will reserve the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, how much time remains on each side?

Mr. SMITH of Texas. I am prepared to close; so I reserve the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, I rise in opposition to the amendment.

Mr. SMITH of Texas. Mr. Chairman, I am prepared to close; so I reserve the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, even the President and his regulatory czar, Professor Cass Sunstein, admit that over-regulation hampers job creation. The Regulatory Flexibility Act of 1980 is based on the fact that regulatory compliance is especially costly for small businesses, which are America's main job creators. In this economy, we have no room for error when it comes to over-regulation. The bill ensures that all agencies follow the Regulatory Flexibility Act. H.R. 527 does not ask agencies to do anything that they should not be doing already right now. There is no reason to create the blanket exemptions proposed by this amendment. There are no such exemptions currently in the Regulatory Flexibility Act for the categories of rules described in the amendment. Further, the amendment would create tremendous confusion among agencies and small businesses regarding which version of the law would apply to a future rulemaking. We need less confusion and uncertainty, not more, in the regulatory process. If the amendment stems from a concern about the ability of agencies to make rules in emergency situations, I would note once again that agencies may avail themselves of the ``good cause'' exception to the notice-and-comment rulemaking process already in the Administrative Procedure Act. If an agency justifiably invokes this exemption, it will not have to conduct the analysis required under the Regulatory Flexibility Act. For these reasons, I oppose this amendment, and I yield back the balance of my time.

Mr. SMITH of Texas. Mr. Chairman, I yield 3 minutes to the gentleman from Illinois (Mr. Manzullo), a member of the Financial Services Committee.

Mr. SMITH of Texas. Thank you, Mr. Chairman. First of all, I would like to point out that the National Federation of Independent Business actually does support this legislation. I also would like for the record to show that a recent Gallup poll taken on October 24 of this year said that small business owners themselves cite ``complying with government regulations'' as their most important problem. Now, that's why we are here today. Mr. Chairman, I oppose this amendment because it puts the cart before the horse. The reason we require agencies to conduct regulatory flexibility analysis is so the agencies and the public will know how a new regulation will affect small businesses before the agency issues the regulation. The amendment would exempt from the Regulatory Flexibility Act any rule that would result in net job creation. We certainly know that regulations can destroy jobs. Even the administration acknowledges that. Whether regulations can ever truly create jobs is another question all together. Assuming that a regulation could create jobs, an agency will not know this without analysis first, which is what the bill requires agencies to do. There is no good reason to transfer this responsibility to conduct this analysis from the agency, themselves, to the Office of Management and Budget, as the amendment proposes. For these reasons, I oppose the amendment, and I yield back the balance of my time.