Transparency

Obama RacineAlthough President Obama occasionally clings to the claim that his administration is the “most transparent” in history, with more and more revelations, this gets farther and farther from the truth. Clearly, we have an epidemic on our hands.

Over the past couple years, I have uncovered case after case of federal government officials, particularly those at the Environmental Protection Agency (EPA), knowingly and willingly moving select correspondence “off-line”, away from required, official email accounts. We have even found senior appointees at EPA, Department of Energy, and the White House Office of Science and Technology Policy using email accounts controlled by environmental pressure groups.

Regardless of intent, although I would argue these practices on their face indicate a desire to evade disclosure, the use of non-official email accounts for work purposes circumvents federal-recordkeeping responsibilities. Since employees have chosen to not search them in response to Freedom of Information Act (FOIA) requests or congressional oversight requests, this allows government officials to avoid revealing their actions to taxpayers who finance their salaries.

These corrupt practices are not isolated to the federal government. In requests the Competitive Enterprise Institute (CEI), assisted Colorado’s Independence Institute with, we show the practice extends to activists employed in state government. In Colorado, this means Gov. John Hickenlooper’s Chief-of-Staff, the governor’s Chief Strategy Officer and Director of the Office of Policy and Research to Colorado, Alan Salazar, and the Director of Environmental Programs for the Colorado Department of Public Health and Environment (DPHE), Martha Rudolph.

On October 15, 2013, I filed a FOIA request on behalf of CEI for all non-official account emails of former EPA Region 8 (Rocky Mountain West) administrator James Martin, a former Environmental Defense (ED) lawyer who we had already showed was using a private account to correspond on work-related issues with former ED colleagues and state officials. After these revelations, like another high-level EPA official — former administrator Lisa Jackson, also known as “Richard Windsor” in a false-identity account I also discovered — Martin resigned from his post in February 2013. Under congressional scrutiny after these revelations, he turned over more emails, which I obtained from the EPA.

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A mixed economy like ours does not remain static.

Economic activity increasingly shifts toward government outright (health care, retirement, education) or exists under “Mother-May-I” constraints like energy production does.

The greatest threat to job creation, wealth and prosperity is that we extend these anti-freedom regulatory policies into tomorrow’s innovations in communications, robotics/automation, manufacturing, and sciences and technology.

When more and more activity falls within the ambit of government rather than that of private competitive enterprise, rules and regulations, executive orders and “notices” take on ominous new significance. This is worsened by policymakers continually dodging the constitutional imperative that an elected body (Congress) create legislation.

Newly significant too are President Barack Obama’s “pens,” “phones” and “years of action” self-consciously operating outside the normal legislative process and even normal Administrative Procedure Act public-input thresholds.

The president just extended the deadline on signing up for Obamacare marketplaces, for example. Exemptions multiply, no matter what the statute says. Meanwhile, what could have been a healthy integrative private health provision and insurance market crumbles.

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Post image for New Data: Code of Federal Regulations Expanding, Faster Pace under Obama

The annual Code of Federal Regulations (CFR) is the “codification of the general and permanent rules published in the Federal Register by the departments and agencies of the Federal Government.”

The page count for final general and permanent rules in the 50-title CFR seems less dramatic than that of the oft-cited Federal Register, which now tops 70,000 pages each year (it stood at 79,311 pages at year-end 2013, the fourth-highest level ever). The Federal Register contains lots of material besides final rules.

Still, the CFR “Archive-Of-All” is big. Very big. Back in 1960, the CFR contained 22,877 pages in 68 volumes.

The pace picked up. The CFR stood at 71,224 pages by year-end 1975, in 133 volumes.

Now, new data from the National Archives shows that the CFR stands at 175,496 at year-end 2013, including the 1,170-page index. (See the breakout below.)

That’s a 146 percent increase since 1975. The number of CFR volumes stands at 235 (as of 2012; the 2013 count remains unavailable for the time being), compared with 133 in 1975.

More recently, at the end of President George W. Bush’s second term (2008), there were 157,974 pages in the CFR.

That means President Obama has added 17,522 pages of regulations in his five years in office; one president growing the regulatory state 11 percent increase in five years.

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Have a listen here.

Last week was Stop Government Abuse Week in Congress, and the House passed a number of reform bills that would increase government transparency. One of the bills that passed, the ALERT Act, was partially based on reform ideas from CEI Vice President for Policy Wayne Crews.

Post image for Here Are the Obama Administration’s 191 Big-Dollar “Economically Significant” Rules and Regulations

If you pay any attention to the debate over federal regulation (there are at least three or four of you), you inevitably hear about “economically significant” rules, and are then told that they have economic impacts (usually costs rather than liberalizations) of at least $100 million annually.

The technical definition is actually different, but such rules are also often referred to as “major” rules. In any event, while the total number of rules and regulations each year tops 3,500, the number of them in the economically significant category over the past decade has ranged from as low as 127 to as high as 224 in the Unified Agenda of Federal Regulatory and Deregulatory Actions each Fall.

The Agenda is like looking at a year-end pipeline, a flow of rules at the “Active” (pre-rule, proposed and final rule states), “Completed” and “Long-term” stages. Often rules are repeats from the year or years before. The Fall edition also includes a so-called “Regulatory Plan” for some agencies that singles out some rules for attention.

Items that get featured or prioritized in the Agenda vary over the years. For example, the Obama administration recently told agencies not to talk so much anymore about their languishing “Long-term” rules, which can be good or bad. It is also the case that Agencies are not legally bound to limit themselves only to what they present in their annual Agendas.

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Post image for Reining in the Executive Branch Bureaucracy, Part 7: Recognize and Reduce Indirect Costs of Regulation

Since the Federalist Papers, America has debated “Energy in the Executive.” But President Obama’s 2014 agenda framed by his State of the Union address heralds a class warfare agenda, one fusing an “income inequality” theme with federal industrial policy and other activism.

When I can act on my own without Congress, I’m going to do so,” Obama promises. This spend-and-transfer fixation makes Americans poorer and dependent except for the lucky few running things.

Others have argued for federal budget rationality as essential to any anti-poverty agenda. This series proposes a greater prosperity enhancing opportunity, streamlining the nearly $2 trillion regulatory state and ending the uncertainty, wealth destruction and job loss it creates.

Accountability in government and basic fairness require acknowledging indirect effects of regulation and minimizing negative impacts.

In the series “Cataloging Washington’s Hidden Costs, it was noted that indirect costs may often be omitted from compliance-focused regulatory direct cost estimates, such as the engineering costs of controlling an emission.

But if indirect costs are regarded as too difficult to compute, then government cannot credibly argue that compliance is somehow not overly burdensome.

If Congress continues to allow regulators to overlook entire categories of indirect costs (such as product bans, disapprovals of pipelines, employment impacts or antitrust regulation’s re-orienting of entire industries), then regulations can tend toward such hard-to-quantify types, imposing grave burdens and dampening productivity. Under such scenarios, many regulations could be expected to feature bans or disapprovals so that regulators would avoid appearing to impose high direct regulatory costs despite hardship inflicted.

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Post image for Reining in the Executive Branch Bureaucracy, Part 6: Deal with the Deadweight Cost of Regulation

Since the Federalist Papers, America has debated “Energy in the Executive.” But President Obama’s 2014 agenda framed by his State of the Union address heralds a class warfare agenda, one fusing an “income inequality” theme with federal industrial policy.

When I can act on my own without Congress, I’m going to do so,” Obama promises. This spend-and-transfer fixation makes Americans poorer and dependent except for the lucky few running things.

Others have argued for federal budget rationality as essential to any anti-poverty agenda. This series proposes a greater prosperity enhancing opportunity, streamlining the nearly $2 trillion regulatory state and ending the uncertainty, wealth destruction and job loss it creates.

The last installment of “Reining In the Executive Branch” explained why to distinguish between “economic” and “social” regulation when reporting on costs, impacts and employment.

Similarly, process rulings like leasing requirements for federal lands and revenue collection standards and service-oriented administrative paperwork — such as that for business loans, passports and getting government benefits already appear separately in OMB reports (and in some cases the Information Collection Budget).

Many such rules implement federal budgetary programs, primarily income transfers from taxpayers to program beneficiaries. Program changes involving Medicare and Medicaid are examples.

Such dollar-for-dollar wealth transfers, like taxes, are not our specific concern here. They should be in many respects, since governmental programs not involving defense or protection of property and rights displace what private sector could do, for example in sweeping areas like health care and retirement.

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Post image for New York Alcohol Bill Benefits Big Business at Consumers’ Expense

New York’s consumers and small alcohol retailers could soon be paying more for their tipples, for the benefit of big wholesalers. A bill now making its way through the New York legislature would require all wine and liquor sold in the state to be warehoused in in-state for 24 hours prior to sale. While the bill would be a boon to the state’s two largest wine wholesalers, who already store their products in-state, it will significantly raise the cost of business for small and mid-sized wholesalers who warehouse in New Jersey—possibly even putting them out of business. Consumers will see prices increase not only right away, but also in the future as competition dwindles.

The bill’s (S3849-2013) author, Senator Jeffrey Klein (D-Bronx), touts it as a way to even the playing field and protect warehouse jobs in the state, while pointing out that 33 other states have similar laws. But so what? In practice, the bill will do nothing to help consumers, either in the short or long term. Right away, prices will increase, as wholesalers are forced to rent space in New York’s more expensive warehouses.

Small and medium-sized liquor and wine dealers will pay an additional $10 per case—a cost increase that, as Connie Oehmler of Verity Wine Partners estimates, will result in an extra $2 per bottle for consumers. And that’s assuming these small and medium wholesalers remain in operation. For many, the cost increases may mean they have to close shop. Over the long term, the reduced competition will give largest wholesalers and warehouse owners little incentive to reduce their prices.

While the bill would provide little benefit to New York consumers, it would prove lucrative for the state’s two largest wine and liquor wholesalers—Southern Wine & Spirits and Empire Merchants–which have put a lot of money into bolstering the bill’s chances. Empire Merchants, which has warehouses in Queens and Brooklyn, has contributed a total of over half a million dollars over the last eight years to key lawmakers in the state, including Gov. Cuomo, state Senate co-leader Dean Skelos, and Assembly Speaker Shelly Silver. Klein, who has received $33,000 in campaign donations from the Empire Merchants, reportedly met with Empire on the legislation, according to a New York Post source. Oehmler is right to call the bill a “blatant, bald-faced attempt to put all their competition out of business.” And this isn’t the first time that a New York lawmaker or Klein, specifically, has been wrapped up in a proposal that appears to be written for the exclusive benefit of a few big New York businesses.

In addition to raising raising alcohol prices, the bill will also likely encourage cross-border alcohol purchasing, as consumers seek out cheaper products in neighboring states, resulting in a lost tax revenue for New York. Despite all the negatives, Klein likely will not back away from his flawed proposal.

Post image for Reining in the Executive Branch Bureaucracy, Part 1: Measure Regulatory Costs

Since the Federalist Papers, America has debated “Energy in the Executive.” But President Obama’s 2014 agenda framed by his State of the Union address heralds a class warfare agenda, one fusing an “income inequality” theme with perverse federal industrial policy.

When I can act on my own without Congress, I’m going to do so,” Obama promises. This spend-and-transfer fixation makes Americans poorer and dependent except for the lucky few running things.

Others have argued for federal budget rationality as essential to a true anti-poverty agenda. This series proposes a greater prosperity enhancing opportunity, streamlining the nearly $2 trillion hyper-regulatory state and the needless uncertainty and destruction of wealth and job opportunities it creates.

Federal agencies often overstate the benefits of their intervention to enlarge their powers over the public; This is not derogatory, the theory of bureaucracy and insights of public choice economics virtually compel it.

The Food and Drug Administration is doing it right now with e-cigarettes that emit only water vapor, the FCC with net neutrality, the EPA with its “social cost of carbon” witchcraft.

Meanwhile, most of the cost of regulation gets ignored. Big time.

We endlessley hear of regulation’s benefits. But of over 46,000 rules and regulations published in the Federal Register since 2001, but only 146 have both cost and benefit analysis. Another 72 bothered with cost analysis.

Furthermore, what bureaus deem benefits are sometimes costs.

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Post image for CEI’s 2014 Unconstitutionality Index: 56 Regulations for Every Law

Every now and then one sees a cute article like this Los Angeles Times piece lamenting that Congress is “ineffective” because it passed only a few laws in 2013.

Some people — most, perhaps — truly believe in no bounds; government should be doing a lot of stuff all the time.

All you have to see is this new Rolling Stone article rallying millennials to the causes of government-guaranteed work for everybody and collective ownership of everything.

After soaking in government schools for 12 years, few recognize anymore that it’s supposed to be hard to pass laws. There shouldn’t be all that many in a free country. Meanwhile, Rolling Stone calls for dictatorship.

Nineteenth-century lawyer, abolitionist, and political philosopher Lysander Spooner was more hard-core than anybody else in opposing that viewpoint, calling “All legislation whatsoever an absurdity, a usurpation and a crime” in his essay Natural Law.

If we don’t have the right to push around or tax our neighbor, we don’t gain the right by assembling a mob to “vote.” Government operates solely by force; we should endeavor to improve society by persuasion, not force.

Usually, to turn the famous phrase on its head, “There ought not be a law,” because most things are not and should not be public policy issues.

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