Experts float plans to overhaul regulatory system

The center issued a “report card” grading federal agencies the homework they do before enacting a new rule. Mercatus looked at more than 100 major rules published between 2008 and 2012, judging them on 12 criteria.

Out of a possible score of 60 points the average grade was 31.2, the center concluded.

Republicans and Democrats on the bicameral panel shared the view that agencies are failing to take proper account of the impacts of new rules.

“Uncertainty over the costs of new regulations in healthcare, the environment, labor issues and financial services is suppressing business investment and the creation of new jobs along Main Street,” said Rep. Kevin BradyKevin Patrick BradyExpanding tax credit for businesses retaining workers gains bipartisan support Former Texas Rep. Sam Johnson dies at 89 On The Money: McConnell: Talking about fifth coronavirus bill 'in next month or so' | Boosted unemployment benefits on the chopping block | Women suffering steeper job losses from COVID-19 MORE (R-Tx.), the committee’s chairman.

Michael Greenstone, an environmental economist at the Massachusetts Institute of Technology, said agencies should be statutorily required to review significant rules retroactively.

President Obama last year directed agencies to study regulations on the books in an effort to root out those that are overly burdensome or unnecessary. But Greenstone said the process should be made a permanent requirement for agencies

He also suggested the establishment of a new independent body, modeled on the nonpartisan Congressional Budget Office, charged with scoring the anticipated costs of new regulations.

“I believe that providing this type of rigorous, independent review would build confidence within the business community and a better sense of transparency,” he testified.

Susan E. Dudley, director of the GW Regulatory Studies Center at the George Washington University told lawmakers that agencies should be requires to examine alternative approaches when developing new rules, and choose the one that provides the greatest net benefits.

She also backed a plan to add restrictions to rulemaking at independent agencies that are not subject to the same requirements as executive branch agencies. Further, courts should be able to review the analyses conducted at agencies to weigh the costs of new regulations against the benefits they provide, Dudley said.