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Ending the Uber wars: How to solve a special interest nightmare

August 11, 2015, 2:28 PM

From The Fiscal Times:

Unfortunately, the United States is far from immune from this political favoritism, though thankfully the experience is not quite so extreme. The R Street Institute, in an assessment of taxi and car service regulations in 50 U.S. cities, found that every city had laws that hindered equal competition. Shockingly, Washington, D.C., which has a history of taxi corruption, even considered a law that would have required car services like Uber to charge a minimum fare at least five times larger than that charged by taxis. Citing the D.C. Council’s proposal, Mercatus Center Senior Research Fellow Matt Mitchell described it this way: “In a spectacular show of candor, the legislation included language stating that the rationale is to ensure that Uber ‘does not directly compete with or undercut taxicab service.’”

Today: Court hears ‘zombie SOPA’ case

August 11, 2015, 7:37 AM

From Politico:

But plenty in the tech world are challenging that notion. Public Knowledge has called the case “Zombie SOPA,” saying if the ITC is able to regulate data on IP grounds, it’ll be able to block websites under the guise of trade regulation. FreedomWorks and the R Street Institute wrote to ITC Chairwoman Meredith Broadbent last week (http://bit.ly/1gYrK5g) saying the agency would be overstepping its authority by regulating data and would “pose a serious threat to free access to lawful content on the Internet.” An amicus brief from Public Knowledge and the Electronic Frontier Foundation argues that the change to the ITC’s authority would also allow it to regulate cross-border telecommunications data. Those groups have asked the court to focus on limiting the ITC’s authority at least so it can’t regulate telecom data.

SXSW policy panels you should vote for

August 10, 2015, 5:02 PM

We at R Street have put together what we think are some great policy panels for next year’s SxSW conference in Austin, Texas. But we need your help to get in the final conference program. Please take a moment to vote for us and help bring free-market ideas to Austin’s annual gathering of technologists, activists and entrepreneurs.

Voting is open now through Sept. 4. Check out the panels below, featuring speakers from R Street and some of our friends. Click through the link to give them a thumbs-up!

Panels featuring R Streeters:

  1. Zombie SOPA—A New Threat to the Open Internet
    • Featuring: Charles Duan, Public Knowledge; Mike Godwin, R Street; Abigail Slater, Internet Association; Ellen Schrantz, Office of Rep. Darrell Issa.
  2. Autonomous Vehicles Are Here. But Are We Ready?
    • Featuring: Ian Adams, R Street; former National Highway Traffic Safety Administrator David Strickland; Jim Chen, Tesla; Jennifer Haroon, Google[x].
  3. Disintermediation in Digital Content Markets
    • Featuring: Katie Oyama, Google; Casey Hastings, Pandora; Sasha Moss, R Street; Rep. Jared Polis, D-Colo.
  4. Regulate All the (Internet of) Things!
    • Featuring: R.J. Lehmann, R Street; John Godfrey, Samsung; Eli Dourado, Mercatus Center; Lauren Soltani, Office of Rep. Suzan DelBene.
  5. Disrupt the Grid! The Politics of “Homebrew” Power
    • Featuring: Catrina Rorke, R Street; Lynne Kiesling, Northwestern University; Tom Tanton, Reason Foundation; Doug Lewin, SPEER.
  6. Dear Government: Show Me the Money!
    • Featuring: Rep. Justin Amash, R-Mich.; Nathan Leamer, R Street; Ohio State Treasurer Josh Mandel,; Rebecca Williams, Office of Management and Budget.
  7. Giving Back: Solving Educational Inequality
    • Featuring: Lori Sanders, R Street; Kate Sheerin, Google; Ed Hidalgo, Qualcomm.
  8. How Super PACs Are Disrupting the Election Process
    • Featuring: Zach Graves, R Street; Lee Dunn, Google; Jonathan Mantz, BGR Group; Martin Avila, Terra Eclipse.
  9. Ride the Wave: Data as Movement Builder
    • Featuring: Greg Fischer, City of Louisville; Dewey F. Bartlett, City of Tulsa; Michele Jolin, Results for America; Lori Sanders, R Street Institute.

Panel submissions from our friends:

  1. Can Congress Tackle the Internet of Things?
    • Featuring: Rep. Darrell Issa, R-Calif.; Elizabeth Frazee, TwinLogic; Paul Daugherty, Accenture; Nicole Gustafson, National Football League.
  2. YOLO Politics: Bringing C-SPAN to Reddit
    • Featuring: Benny Johnson, IJ Review; Evangeline Johnson, Terra Eclipse; Liz Mair, Mair Strategies LLC; Joshua Lamel, BGR Group.
  3. Decrypting the Cyber Security Debate in Washington
    • Featuring: Rep. Will Hurd, R-Texas; Chani Wiggins, TwinLogic; Sonny Sinha, Department of Homeland Security; Denise Zheng, Center for Strategic and International Studies.
  4. Are We Giving China the Internet? ICANN Explained
    • Featuring: Rep. Suzan DelBene, D-Wash.; Christian Dawson, i2 Coalition; Michele Neylon, Blacknight Internet Solutions; Tiffany Moore, TwinLogic.
  5. Elise’s Data-Plan: Connecting Rural America
    • Featuring: Sen. Jerry Moran, R-Kan.; Rebecca Thompson, Competitive Carriers Association; Kristi Henderson, University of Mississippi Medical Center; Eric Woody, Union Wireless.
  6. Following the Stream: Congress & Music Royalties
    • Featuring: Casey Rae, Future of Music Coalition; Rep. Mimi Walters, R-Calif.; Katie Peters, Pandora; Rachel Wolbers, TwinLogic.
  7. Copyright & Creators: 2026
    • Featuring: Lateef Mtima, Howard University School of Law; Betsy Rosenblatt, Whittier Law School; Alexandra Mogyoros, University of Oxford; Jon Healey, Los Angeles Times.
  8. Winter is Coming: Copyright Chill on Security
    • Featuring: Corynne McSherry, Electronic Frontier Foundation; Laura Moy, New America Foundation; Kyle Wiens, iFixit; Karen Sandler, Software Freedom Conservancy.
  9. Pixelated & Political: The Internet in Washington
    • Featuring: Rep. Blake Farenthold, R-Texas; Rep. Eric Swalwell, D-Calif.; Rep. Renee Ellmers, R-N.C.; Michael Beckerman, Internet Association.
  10. Internet Economy: In the U.S. & Abroad
    • Featuring: Sen. John Thune, R-S.D.; Michael Beckerman, Internet Association.
  11. Embedding Human Rights in the Internet
    • Featuring: Joseph Hall, Center for Democracy & Technology; Karen Reilly, Independent; Eric Sears, MacArthur Foundation; Lindsay Beck, Open Technology Fund.
  12. How to Fight ISIS without Breaking the Internet
    • Featuring: Rebecca MacKinnon, New America Foundation; Judith Lichtenberg, Global Network Initiative; Shahed Amanullah, LaunchPosse; Andrew McLaughlin, Betaworks.
  13. The End of Online Free Expression?
    • Featuring: Gautam Hans, Center for Democracy & Technology; Dorothy Chou, Dropbox.
  14. CDT/Fitbit: Ethics & Privacy in Wearable Research
    • Featuring: Michelle De Mooy, Center for Democracy & Technology; Shelten Yuen, Fitbit.
  15. Everybody Dies: What is your Digital Legacy?
    • Featuring: Alethea Lange, Center for Democracy & Technology; Megan Yip, Law Office of Megan Yip; John Troyer, Centre for Death and Society; Vanessa Callison-Burch, Facebook.
  16. The Singularity and the Question of God
    • Featuring: Julie Germany, White Coat Waste; Luke Kenworthy, Indiana Office of State-Based Initiatives; Taylor Barkley, Mercatus Center; Joe Carter, Action Institute.
  17. Protecting the Digital You
    • Featuring: Nuala O’Connor, Center for Democracy & Technology
  18. Euro vs. American Privacy: Clash of Civilizations?
    • Featuring: Jillian York, EFF; Ulf Buermeyer, Netzpolitik; Raegan MacDonald, Access; Chris Soghoian, American Civil Liberties Union.
  19. Every City is an Internet City
    • Featuring: Nika Nour, Internet Association; Sen. John Thune, R-S.D.; Sen. Jerry Moran, R-Kan.; Rep. Fred Upton, R-Mich.
  20. The Killer Congressional Office
    • Featuring: Seamus Kraft, Open Gov Foundation; Rep. Seth Moulton, D-Mass.; Sen. John Cornyn, R-Texas; Rep. Cathy McMorris Rodgers, R-Wash.; Sen. John Thune, R-S.D.
  21. Marriage Equality: Where do we go from here?
    • Featuring: Seth Guidry; Jerri Ann Henry, Freedom to Marry; Julie Germany, White Coat Waste; Tyler Deaton, American Unity Fund.
  22. Crowdfunding: Possibilities and Policy Challenges
    • Featuring: Ryan Feit, SeedInvest; Sara Hanks, CrowdCheck; Michal Rosenn, Kickstarter; Evan Engstrom, Engine.
  23. Internet of Things: Just Someone Else’s Computer?
    • Featuring: Rep. Blake Farenthold, R-Texas; Sherwin Siy, Public Knowledge; Jen Ellis, Rapid7; Sara Watson, Berkman Center.
  24. Using data to power criminal justice reform
    • Featuring: Emily Shaw, Sunlight Foundation; Wesley Lowery, Washington Post; Tracy Siska, Chicago Justice Project; Clarence Wardell, Presidential Innovation Fellows Program.
  25. The New Battle Over Encryption & How to Survive It
    • Featuring: Kevin Bankston, New America Foundation; Moxie Marlinspike, Open Whisper Systems; Jennifer Valentino-DeVries, Wall Street Journal; Heather West, CloudFlare.
  26. No Encryption Backdoors, Please. Myths Debunked.
    • Featuring: Sunday Yokubaitis, Golden Frog.
  27. Cryptowars 2.0: Silicon Valley vs. Washington
    • Featuring: Sara Sorcher, CS Monitor; Matt Blaze, University of Pennsylvania; Amit Yorak, RSA; Stewart Baker, Steptoe & Johnson LLP.
  28. Smart Cars, Smarter Cities: New Transit Tech
    • Featuring: Michael Petricone, Consumer Electronics Association; Susan Zielinski, SMART; Andrew Collinge, Greater London Authority; Ashwini Chhabra, Uber.
  29. Get your Goods: Unmanned Systems and 3D Printing
    • Featuring: Doug Johnson, Consumer Electronics Association; Gur Kimchi, Amazon; Ping Fu, 3D Systems; Richard Pelletier, Ford Motor Co.
  30. Building better cities with better data
    • Featuring: Chris Gates, Sunlight Foundation; Tony Yarber, City of Jackson; Jennifer Pahlka, Code for America; Daniel X O’Neil, Smart Chicago Collaborative.
  31. Be the Next Tony Stark
    • Featuring: Mike Geersten, TandemNSI; Gary Shapiro, Consumer Electronics Association; Christina Winn, Arlington Economic Development; Brad Tousley, Defense Advanced Research Projects Agency.
  32. 5 Best Startup Ideas in VR / AR
    • Featuring: Robert Scoble, RackSpace; Nonny De La Pena, Emblematic Group; Shawn Dubravac, Consumer Electronics Association.
  33. High Res Audio in Every Earbud
    • Featuring: Jeff Joseph, Consumer Electronics Association; Maureen Droney, The Recording Academy; Aaron Levine, Sony; Pal Bratelund, TIDAL.
  34. Tech at Issue in 2016 Election
    • Featuring: Julie Samuels, Engine; Ron Klain, Revolution LLC; Ted Ullyot, Andreessen Horowitz; Tony Romm, POLITICO.
  35. Online Privacy and the Price of Free
    • Featuring: Sunday Yokubaitis, Golden Frog; Alan Fairless, SpiderOak; Alex Bradshaw, Center for Democracy & Technology.
  36. Making Texas Wine in the Drone Age
    • Featuring: Michael Hendrix, U.S. Chamber of Commerce Foundation; Ryan Baker, Arch Aerial LLC; January Wiese, Texas Hill Country Wineries.
  37. Survive the End
    • James Carafano, Heritage Foundation; Ericka Anderson Sylvester, National Review; Stacy Washington, Emmis Communications; Lindsey Burke, Heritage Foundation.
  38. Fair Use Awakens: Classrooms/Libraries/Communities
    • Featuring: Heidi Tandy, Organization for Transformative Works; Ebony Thomas, University of Pennsylvania; Elizabeth Rosenblatt, Whittier Law School.


This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

Hillary wants debt-free college (just like Bernie!)

August 10, 2015, 4:15 PM

Bernie Sanders is racking up rallies on the West Coast this week, kicking off his Pacific jaunt with a rally for 20,000 Bernie-maniacs in Portland. Even though Bernie’s speech was ultimately to a very friendly audience of Portland artisanal craftspeople and alternative bookstore owners, it had to be enough to put Hillary Clinton on notice that she’s again being challenged by an upstart young whippersnapper with great grassroots potential.

I kid, obviously. About the whippersnapper part. Bernie tried to nationalize fire when his cave-mate discovered it.

At any rate, today Hillary Clinton is offering everyone a free college education, because desperate times call for desperate measures. She might be able to afford to lose Portland, but she can’t possibly be expected to lose all the youth she’s energizing with her pantsuits and her snapchats and her hip language.

Hillary Clinton is proposing an expansive program aimed at enabling students to attend public colleges and universities without taking on loans for tuition, her attempt to address a source of anxiety for American families while advancing one of the left’s most sweeping new ideas.

The plan—dubbed the “New College Compact” and estimated to cost $350 billion over 10 years—would fundamentally reshape the federal government’s role in higher education by offering new federal money, but with strings attached.

States would have to increase their own spending on higher education, and universities would be required to control spending, though the Democratic presidential front-runner hasn’t yet worked out details. Families still would be required to contribute, but students wouldn’t have to take out loans to attend public schools.

Forgive me for being blunt, but this might be the stupidest plan I’ve seen since the Tigers traded out their entire pitching staff midseason for a dude who lives in a van. I’m not just saying that because Hillary has very little cache on the issue – going up against Bernie Sanders who has waged the “free college” Quixotic crusade for decades – or because it’s blatant pandering. I’m saying it because it fundamentally misunderstands the student debt problem to begin with.

Yes, lots of people have borrowed lots of money, myself included. Occasionally, that money becomes difficult to pay back. And the cost of college is fundamentally out of whack with the economy, of course: as the supply of schools increases for students and demand for higher education decreases for colleges, it follows that higher education costs should go down and not up, even if the majority of the students attending those schools are getting useless degrees in midcentury French film.

But that’s not what’s happening – as the years go on, college gets more expensive and less necessary, and students are paying back scads of money to the federal government without an end in sight.

This is the fault of unrestricted student lending from the federal government, the kind Hillary wants to expand. Colleges know they can get any amount of money from students, and so, regularly raise their rates, thus asking for more money the government will undoubtedly approve. Students see no reason not to pay the higher prices, since those are akin to the going rates, and so take more and more money from the federal government and its licensed private lending corporations to pay colleges. As the federal government improves its lending program, colleges charge more, making the whole thing a vicious cycle, with students caught in the middle. The more the government lends, the more colleges charge, the more debt students are saddled with.

And to make matters worse, this is actually beneficial to the government. Student loan repayments are a more lucrative revenue stream for the federal government than income taxes. So the more they lend, the more the students pay back, the better the government does on its investment.

Hillary’s plan merely gives the money to the colleges directly. Thus, I suppose, it eliminates the middleman, but doesn’t make it any easier for college students to repay their massive loans or to get a quality education.

Appeals court to hear US agency’s decision to block digital imports

August 10, 2015, 7:30 AM

From IDG News:

There is “absolutely no need to manufacture new agency powers over digital data,” free-market groups the Niskanen Center, the R Street Institute and FreedomWorks wrote in a letter to the USITC this month. “Markets for digital goods have thrived for decades without the commission exercising these powers.”

A Bush/Rubio ticket would be complicated, not impossible

August 09, 2015, 1:52 PM

They would, in some senses, appear to be the dream ticket. One is the more moderate elder statesman; one is the brash young firebrand. One is the darling of the establishment and a fundraising juggernaut; one has already come from behind to beat the establishment at least once and still has legitimate Tea Party cred. They are personal friends and have worked well together at the state level.

The potential 2016 ticket of Jeb Bush and Marco Rubio also would seem well-positioned to respond to what was an obvious weakness diagnosed in the Republican National Committee’s post-mortem on the party’s 2012 loss – its dismal performance among Latinos.

Both Bush and Rubio are Catholics. Both are fluent Spanish speakers. One is the child of Cuban immigrants; one is married to a native of Mexico. Both have indicated support for the party’s priority of increased border security, but they also have talked about expanded visas and offering some pathway to citizenship for those already here illegally (though the details of their specific plans differ).

None of these qualities are likely to endear them to the base, but they could matter significantly in a general election, particularly given that the party’s Latino support has continued to slide from a recent 2004 peak, even as Latinos’ share of the electorate continues to rise.

In 2000, George W. Bush won 35 percent of the Latino vote, which then constituted just 5.68 percent of the electorate. In 2004, he won 44 percent of the Latino vote, which had grown to 7.02 percent of the electorate. In 2008, John McCain, who has supported immigration reform, took 31 percent of the Latino vote, which by then was 8.22 percent of the electorate. In 2012, Mitt Romney took just 27 percent of the Latino vote, which was then 9.21 percent of the electorate.

In 2016, the Latino share of the electorate is expected to be even larger. Partly, this is because the community continues to grow as a share of the population. But analysts also project relative strengthening due to expectations that the African-American community’s share of the electorate will shrink from the record turnout seen in 2008 and 2012 for the election and reelection of Barack Obama.

For a Republican to win in 2016, he (and it will be a he, barring a very longshot candidacy from Carly Fiorina) likely will have to at least come close to winning 40 percent of the Latino vote. As polling by the group Latino Decisions shows, even Bush and Rubio aren’t quite there yet, but they are in better shape than much of the field (including Ted Cruz, who also is of Cuban extraction) and they at least are outpolling Romney’s final numbers, which is a big first step:

There’s also the fact that both Bush and Rubio have won statewide election and remain popular in the most crucial swing state – Florida. While the GOP has won Florida a couple times in years when they didn’t win the big enchilada (in 1960 and 1992), the last time the Republican Party won the presidential election without winning Florida was in 1924, when the much-smaller state had only six electoral votes.

Aye, but there’s the rub.

Article II of the U.S. Constitution, which both creates the executive branch and lays out the process for selecting the leaders of that branch (the president and vice president), states clearly that:

The electors shall meet in their respective states, and vote by ballot for two persons, of whom one at least shall not be an inhabitant of the same state with themselves.

This requirement is generally summarized as: “the president and vice president can’t be from the same state.” That’s not quite true.

In the original setup, the Electoral College would simply cast two votes, and the candidate with the most votes would be named president, while the one with the second-most votes would be named vice president. John Adams was named vice president after finishing second to George Washington (who received unanimous Electoral College support) in 1788. In 1792, Washington was the nominee of both major parties, effectively making the ballot a vice presidential race between Adams and New York Gov. George Clinton. In the election of 1796, there were seven Federalists candidates (including Adams, who became president) and four Democratic-Republican candidates (including Thomas Jefferson, who became vice president).

The election of 1800, in which the Democratic-Republican “ticket” of Jefferson and Aaron Burr completely defeated the Federalist ticket of Adams and Charles Pinckney, was the first to resemble our modern elections. And in 1804, the 12th Amendment was passed, making the presidential and vice presidential selections two separate races.

But the amendment kept intact the original language preserving the requirement that binds electors to “meet in their respective states, and vote by ballot for president and vice president, one of whom, at least, shall not be an inhabitant of the same state with themselves.”

What this means in practice is that, should Jeb Bush and Marco Rubio run as a ticket, electors from the State of Florida would be prohibited from casting a ballot for both of them. Cue sad trombone:

Of course, in most years, this wouldn’t actually matter. Of all the presidential elections since 1900, only the 2000 and 2004 races were sufficiently close that the winning candidate wouldn’t still have prevailed if he had lost his home state. (The 1916 election between Woodrow Wilson and Charles Hughes was awfully close, separated by just 23 electors. But in that case, Wilson did actually lose his nominal home state of New Jersey. Had he also lost his birth state of Virginia, on the other hand, that would have swung the election to Hughes.)

Even in a very close 2016 race, provided the margin of victory is at least 29 electoral votes, the Florida delegation could go “faithless” and select some other candidate for vice president. So long as it wasn’t the Democratic vice presidential nominee, it wouldn’t matter. But it seems pretty clear Republicans wouldn’t want to take the risk that they might need Florida’s 29 electoral votes – accounting for more than 5 percent of the total – to go to both Bush AND Rubio if they are to have any hope of seating both.

If the GOP were to roll the dice and move forward with a Bush-Rubio ticket anyway, any number of wacky scenarios could theoretically ensue. You could see the Electoral College decline to vote for vice president, which would throw that election to the U.S. Senate, or decline to vote for president, which would throw that race to the U.S. House. In an extreme scenario, the Florida Republican Party could technically only nominate electors who live outside of the state and who would not face the same limitation in casting ballots for both Bush and Rubio.

But none of these fanciful suggestions are likely to transpire. Instead, the easiest path would be for either Bush or Rubio to change his official state of residence. Indeed, that’s precisely what happened in 2000, when Dick Cheney changed his state of residence from Texas to his home state of Wyoming.

Of the two, it probably makes more sense for Bush to change his state of residence. He appears to be thoroughly done with his Florida political career, whereas Rubio could still be ripe for future office should the whole presidential/vice presidential thing not pan out. Moreover, Bush is already a transplant. He was born in Houston to a political dynasty with origins in Connecticut and New Jersey.

In fact, it so happens that Bush just spent $600,000 to build his own 3,000-square-foot, four-bedroom “cottage” on the family’s compound in Kennebunkport, Maine.  Proximity to New Hampshire probably plays some role in that decision. But one can’t help but notice that it sure does also offer a convenient contingency plan, should he want to bring Marco aboard as a running mate.

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

Letter to the Editor: Carbon pricing’s time has come

August 08, 2015, 9:57 AM

From the New Haven Register:

Just consider all the conservatives who have already called for carbon pricing: George Shultz, Greg Mankiw, Bob Inglis, Eli Lehrer and others at R Street, Irving Stelzer, Jerry Taylor, David Brooks, Holman Jenkins Jr., Arthur Laffer, the Republican governors who created Regional Greenhouse Gas Initiative (a cap and trade system), Susan Collins (sponsored a cap and dividend plan), and EPA directors appointed by Republican presidents (William Ruckelshaus, Lee Thomas, William Reilly and Christine Todd Whitman).

Drought or no drought, Texas must prepare for water future

August 07, 2015, 7:00 AM

After years of enduring one of the fiercest droughts on record, Texas officially became completely drought free in July.

Texas’ no drought status didn’t last long; on Aug. 3 a small portion of east Texas was classified as again being in moderate drought. But overall, it’s hard to deny that this spring’s heavy rains have provided much needed relief to farmers, ranchers, and the rest of us throughout the state.

If history is any guide, the return of the rains means that water will fade from the political consciousness, and people will go back to taking water for granted. But that would be a mistake. For if history is any guide, droughts will return. And as hard as it may be to believe, next time it could be even worse.

Texas is growing. Population is expected to grow by 20 million over the next 50 years. All of those folks are going to use water. Texas has also maintained a vibrant industrial base. That’s great for our economy, but it will require a lot of water to keep going.

To meet Texas’ long term water challenges, the state has developed a state water plan, that includes 50-year projections about Texas’ future water needs by region, and collects proposals for water projects that can meet those needs. The state has also set up a number of loan programs (most prominently the State Water Infrastructure Fund of Texas, or SWIFT) to help localities and others fund projects, which recently announced nearly $4 billion in projects it would fund over the next decade. Texas has also launched a PACE program, which makes it easier for industrial and commercial facilities to get financing for energy and water efficiency improvement projects.

While important, these measures alone are not enough. Many communities are reluctant to commit themselves to major expenditures based on projections of future growth and rainfall patterns that may or may not materialize. Even where developers are willing to undertake the risk, they can be stymied by local restrictions or threats of environmental lawsuits.

Conservation is a key part of the solution, but the way our water systems are currently funded often works against conservation. Having water utilities promote conservation is a little like having Coca-Cola try to get people to drink less Coke; there is an inherent conflict of interest involved. And to the extent that utilities use volume based water charges to cover fixed infrastructure costs, people who do use less water can paradoxically see their bills go up.

Still, the best way to encourage conservation is to set the price of water at a level that fully accounts for its costs. Attempting to limit water use through mandates and restrictions will inevitably lead to unfairness. Industries with political clout will lobby for fewer restrictions, while the burden of shortages will be shifted to others. We can see that playing out now in California (which unlike Texas is still battling drought). In April, Gov. Jerry Brown issued an executive order decreeing a 25 percent reduction in urban water use. Yet comparable reductions were not mandated for the state’s water intensive agriculture sector.

By contrast, increased water prices would encourage conservation across the board and would incentivize development of new water supply. No one wants to pay more for water. I certainly don’t. But if we don’t prepare for the next drought, we may find that our procrastination has proved even more costly.

Tech industry recommends FTC take laissez-faire approach to regulating sharing economy

August 06, 2015, 6:30 PM

From Communications Daily:

R Street Institute Senior Fellow Ian Adams suggested in comments that “consumer-protection mechanisms must be narrowly tailored, both as to their depth and breadth.”

Has the Clean Power Plan abandoned energy efficiency?

August 06, 2015, 2:08 PM

The Environmental Protection Agency on Monday released the final version of the Clean Power Plan (CPP), which mandates a 32 percent reduction in carbon-dioxide emissions from the U.S. power sector by 2030.

The final rule is broadly similar to the original proposal from June 2014. However, there are some key differences. Among the most striking is the EPA’s retreat from using energy efficiency in calculating its reduction targets.

Let’s unpack this a little. The EPA set its reduction targets based on a process known as the Best System of Emissions Reduction (BSER). In layman’s terms, the EPA looked at the different ways you feasibly could reduce emissions, and combined them to get an overall standard. A power plant in a given state isn’t obligated to use the specific methods EPA lays out, so long as it meets the emissions standard somehow.

As originally proposed, the CPP relied on four “building blocks” to calculate the BSER standard. The first involved traditional means to increasing efficiency at power plants. Building blocks 2 and 3 focused on ways states could give preference to lower-carbon forms of power, like natural gas, nuclear and renewable energy. Finally, building block 4 involved ways a state might reduce use of high-carbon electricity by reducing consumers’ overall demand for power.

Building blocks 2, 3 and 4 raised more questions than building block 1, as they involved action “outside the fence” of regulated power plants. Building block 4 was especially contentious, as it seemed to depend on states passing laws that establish various energy-efficiency mandates. Since the legal basis for the Clean Power Plan was the EPA’s authority over emissions from power plants, it wasn’t clear how the agency could mandate reductions in emissions that could only be achieved by entities it doesn’t regulate.

When the final rule was released this week, building block 4 was gone. Which just might have something to do with a recent federal appeals court decision invalidating a Federal Energy Regulatory Commission rule that, similarly, was designed to encourage energy efficiency by providing incentives to reduce power consumption.

According to the D.C. Circuit, FERC lacked authority to issue rules on the subject. Since FERC’s legal authority over electricity far exceeds the EPA’s, the decision would appear to bring into question the viability of building block 4. FERC has since appealed the decision, which is set to be heard by the Supreme Court this fall. While there’s no proven link, it certainly seems the EPA decided it was better not to proceed with such a legally questionable portion of the rule.

Ultimately, the impact of EPA striking building block 4 will be minimal. While the EPA isn’t using the building block to determine emissions standards, the final rule still allows states to use energy-efficiency measures to comply with those standards.

One would think that abandoning energy-efficiency calculations when setting the standard would lower the bar for how much emissions reduction each state would be asked to meet. But in fact, the total reductions required by the final rule are higher than in the proposed rule. Essentially, that means that whatever leniency states received has been more than offset by expansions to the other building blocks.

Republican presidential candidates: Show us you can #FixGov

August 06, 2015, 11:55 AM

Presidential debates inevitably send the Beltway a-dither. Who will win? Which aspirant will deliver the best zinger? Who will look like a lost puppy or have an ugly or obtuse moment? And who will viewers and the media find likable?

Thursday’s Republican debate is inciting extra anticipation. Not least is the Trump factor. The Donald is sure to bluster and talk trash, and some observers hope to see him crater the same way Ross Perot did when he squared off against Al Gore on Larry King. Maybe Ted Cruz will turn his fierce debate skills toward Trump. Polling at 6 percent and not much loved in the Senate, Sen. Cruz has little to lose.

Who will be in Cleveland, Ohio is another question fueling chatter. We know there will be a second amateur on stage—Ben Carson. Will he move beyond his talking points? Will he say anything that might hurt his odds at being considered for vice president? Additionally, only the 10 top-polling candidates are invited to Quicken Loans Arena to show their stuff, which may prove a deathblow to the excluded candidates. Bye-bye Lindsay Graham, George Pataki, Rick Santorum, Bobby Jindal, Carly Fiorina, Rick Perry and Jim Gilmore?

In such an overcrowded field, the candidates will be under pressure to make their voice heard. There will be plenty of the usual Pablum: repeal Obamacare, no gun control, cut taxes, protect religious freedom and so forth. With everyone hitting most of the same notes (and trying to out-shout Trump), there is a real opportunity for a candidate to distinguish himself by explaining in detail how to fix government.

This is a decidedly juicy topic for conservatives. Public trust in government is very low, according to Pew Trust polling, and John Q. Public has told Gallup pollsters that government is a bigger problem than either unemployment or the economy. This popular discontent cannot be chalked up to mere crankiness. Media stories about government gaffes are pretty regular fare. The hack of the Office of Personnel Management’s database is only the latest high-profile malfunction.

Government failure is real and the empirical evidence is overwhelming. Whether one consults Paul Light’s compendium of government cock-ups, Peter Schuck’s 400-page “Why Government Fails So Often,” John Dilulio’s “Bring Back the Bureaucrats” or Steven Teles’ pithy article, “Kludgeocracy in America,” the takeaway is roughly the same: the federal government has taken on too many responsibilities, some of which it is ill-suited to address.

Additionally, the layering of policies and rules atop agencies have left them mission-torn and triaging their various responsibilities. Policies have become grotesquely complex and often are administered through baroque webs of state, local and private-sector proxies that would make Rube Goldberg chortle. As the National Commission on Public Service put it more than a decade ago:

There are too many decision-makers, too much central clearance, too many bases to touch, and too many overseers with conflicting agendas… accountability is hard to discern and harder still to enforce.

Conservative complaints about big, pernicious government are age-old. To stand out in Thursday’s debate, a candidate will need to do more than denounce big government and bash bureaucrats. He will need to demonstrate that he has a grasp of the $3.4 trillion, complex beast that is the government. He also ought to give clear evidence that he has considered which things the federal government can do well, which activities it can do better and which policy areas it should exit. And, critically, he must demonstrate that he has the temperament to work with Congress, whose laws are the source for much of what ails the government.

Finding a General Fund budget out of Alabama’s shell game

August 06, 2015, 11:04 AM

If you’re getting the feeling that Alabama’s General Fund budget is more and more like a carnival shell game, you’re not alone.

Just keep your eye on the ball as the shells start moving at a frantic pace.

First, there’s always the option of cutting the General Fund to match expected revenues. For most conservatives, that’s the answer. At the same time, across-the-board cuts aren’t helpful. Nobody rolls back their housing budget the same as their vacation budget if they need to save money; they prioritize. Relying on precision cuts has support in the Legislature and is popular with many voters across Alabama.

That said, let’s assume that Gov. Robert Bentley and a potential legislative majority have some common priorities that start with the presumption that they want to spend more money in the General Fund than they’re expecting. That consensus amount now seems to be somewhere in the $150-250 million range.

Most also realize the importance of growth revenues in the General Fund. Unless we want to play this annoying budget game every couple of years, we need revenues that have even a remote chance to keep up with the fiscal drivers of Medicaid and corrections.

Almost all legislators want to create economic certainty by ending the revenue guessing game; it’s simply bad for Alabama. Our anemic economy grew around 0.7 percent last year. That’s about half the national average. With every tax imaginable percolating in Montgomery, it’s reasonable for businesses to wait and see how this is going to play out.

So what’s the politically viable path that puts more money in the General Fund, moves growth revenues and creates economic stability?

The first move is to put the state’s use tax revenues into the General Fund instead of the Education Trust Fund (ETF). And, no, I’m not talking about moving the revenues and non-education spending lodged in the ETF.

Yes, I know that sounds like World War III with Alabama’s education establishment, but hang with me.

The move accomplishes the objective of moving growth revenues into the General Fund and increasing the amount of dollars available by around $200-$275 million. With a little massaging, that should be enough to fund government at a constant level, cover prison-reform spending and give a head nod toward priorities like Dianne Bentley’s domestic-violence program.

At the same time, it would leave a financial hole in the ETF. The first option is to clear the deficit by tackling education-spending reform. We’re probably not funding the K-12 classrooms at optimal levels, but we’re spending in several areas that need extra fiscal scrutiny. There’s not a lot of interest in trying to cut back education spending, so let’s table that option for the moment.

The second alternative, thought it might be wishful thinking, is that the economy grows and fills the lost revenues without additional legislative action. No new taxes, no gaming and a vanishing budget problem. That would be great, but our economy is going to need a serious boost for that to be viable.

The third option actually reflects State Superintendent Tommy Bice’s concern that moving money from the ETF could cause proration. It might, but the ETF proration-prevention account should have more than enough resources to stop that from happening. We wouldn’t see immediate cuts to education, and legislators would have a little short-term breathing room to “backfill” the ETF.

That move has a couple of political advantages.

Right now, they’re fighting the losing battle of raising revenue for what amounts to prisons and Medicaid. If they’re filling an Education Trust Fund hole, they can argue that it’s “for the children.” Even though tax hikes are still unpopular in Alabama, the political optics of relating them to education are far better. As for gaming, funding education is consistent with the methods used to enact lotteries around the nation.

Gaming and taxes won’t be any more popular in the next regular session than they are right now, but creative legislation now might make them more palatable. If they still don’t muster enough support, it’s either living on the prayer of better economic growth or breaking out scalpels and surgical masks to slice into Alabama’s budgets.

Clean Power Plan begs for a better conservative response to pollution control

August 05, 2015, 5:12 PM

On Monday, the Environmental Protection Agency released the final version of President Barack Obama’s Clean Power Plan. Designed to curb U.S. carbon emissions, conservatives predictably don’t like the plan.

That’s simply not a good enough response.

There’s plenty not to like about how we currently handle pollution control, but most of us think that government does have at least some role in limiting pollution.

To fight rules on carbon dioxide, conservatives largely have opted for the “just say no” strategy of litigation and noncompliance. It might work. Then again, the Supreme Court’s deference to Congress in the Affordable Care Act cases, combined with the trajectory of recent carbon litigation, both indicate that it might not.

The EPA is as much of a command-and-control political entity as any in Washington. Most of its authority is derived from congressional power delegated more than 40 years ago. Add in a few Supreme Court decisions favorable to the agency, and we’re left with bureaucrats that write, change and enforce law at-will.

Thanks to a 2009 Supreme Court decision, we already consider carbon dioxide a pollutant as a matter of law. Restraining carbon emissions has serious implications for the cost of electricity; even proponents of the plan acknowledge as much.

While the environmental benefits of cleaner air and water are important, those benefits won’t pay consumers electric bill every month. If generators are out of compliance, the EPA imposes fines and penalties, effectively directing the “compensation” for pollution harm to itself, rather than to individuals who are impacted. The model trades environmental harms for economic ones.

Unfortunately, conservatives fighting the battle over carbon regulation are missing the bigger point: the EPA is a clumsy way to regulate pollution in the first place.

EPA regulation is complicated, confusing and ever-changing. Just consider the EPA’s maximum achievable control technology (MACT) rules. For existing generation, the MACT emission level “must equal the average emissions limitations currently achieved by the best-performing 12 percent of sources in that source category, if there are 30 or more existing sources.”

Got that?

The Clean Power Plan isn’t much different. It operates on an equally vague “best system of emission reduction…adequately demonstrated” (BSER) standard that focuses on three “building blocks.”

Building blocks should be children’s toys, not regulatory requirements.

EPA emission restrictions could change at any time, because they’re tied to the currently available technology, rather than to objective indicators of health and safety. The constant change is costly, and industry players have a little incentive to innovate beyond initial requirements.

Instead, we should set emission levels to protect our citizens and our environment. Industry should be free to develop creative ways to comply. Sure, we’ll battle over where to draw those lines, but clear stable limits make compliance less costly over the long haul.

This may make a few heads explode, but there’s actually a strong conservative case for pollution taxes as an alternative to heavy-handed EPA regulation. Conservatives need not like the idea of taxes to see that they’re a more flexible option than tomes of regulation.

A tax has the potential to meet our pollution-control goals with the clarity and efficiency that are conspicuously absent from the current EPA paradigm. It also presents the unique opportunity to protect ratepayers against higher energy costs by offsetting other taxes, like those assessed on income.

The added bonus for conservatives is that pollution taxes will likely function as a declining revenue stream, as power generators find ways to meet limits efficiently. That has tremendous potential to limit the size of government.

Pollution taxes aren’t without pitfalls. An effective pollution tax requires politicians ensure the solution is revenue-neutral and not designed to grow government. More importantly, such taxes also need to be structured as an alternative means for pollution control, rather than being layered atop costly regulations.

Conservatives aren’t stuck with the “EPA or the highway” approach to pollution. Even in the event that the Supreme Court upends the Clean Power Plan, we can still do better handling existing pollutants. If we’re willing to explore other options, we just might do a better job of protecting consumers and our environment at the same time.

Federal agencies missed 1,400 regulatory deadlines

August 05, 2015, 4:11 PM

In the waning days of 2006, Congress passed the Postal Accountability and Enhancement Act. The statute made myriad changes to postal law and tasked the Postal Regulatory Commission with a big job: issuing regulations to establish a new system for pricing the postage everyone pays to send mail and parcels. To its credit, the PRC got the work done way before the 18-month deadline.

Would that more agencies were so successful. Collectively, federal agencies missed 1,400 deadlines in the past 10 years, a new R Street Institute study finds. That amounts to nearly half the deadlines Congress set in law. In some cases, agencies have been years late in meeting their deadlines.

This a serious problem and one that should concern both Democrats and Republicans. The missed deadlines delay implementing various policies passed by Congress and signed by the president. The Food and Drug Administration was late in developing regulations for food sold in vending machines. The Department of Commerce was slow in issuing regulations to reduce accidental deaths of bottlenose dolphins from commercial fishing. The Department of Transportation was dilatory in finalizing rules to suspend the licenses of truck drivers convicted of safety violations.

It should be noted that missing a regulatory deadline is a violation of federal law. Congress directed an agency to complete implementation of a policy by a specific data and the agency failed to heed that order.

Which leads to a second problem— uncertainty. Inevitably, regulations have costs and benefits for whomever is being regulated. New rules also affect agency operations by adding tasks to their workload. Knowing what a regulation will require, and when it will take effect, helps affected individuals, businesses and authorities prepare for the changes. States, health insurers, doctors, hospitals and millions of individuals were affected by the Patient Protection and Affordable Care Act. Yet, the Department of Health and Human Services and other agencies missed half the Obamacare regulatory deadlines.

Why do agencies miss so many deadlines? In some cases, Congress sets deadlines that are too short. Producing a federal regulation is a time-intensive process, requiring research, public comment, review by the Office of Management and Budget and still more steps. Usually, it takes agencies at least a year to issue a new regulation, and sometimes many years. Yet Congress frequently sets deadlines of only a year or two.

However, it also is the case that agencies sometimes drag their feet and rarely suffer a penalty.

Remarkably, Congress itself has no system to oversee all the regulatory deadlines it assigns. When drafting a bill that imposes new deadlines, members have no way to see how many deadlines already have been assigned to an agency or whether they’ve been met. Committee staff do try to follow regulatory policy, but it’s very much catch-as-catch can. With about 2,700 new regulations issued and another 4,000 finalized each year, there simply is not enough manpower or hours in the day.

To address this crippling institutional weakness, Congress should establish a Congressional Regulatory Affairs Office, a proposal that has bipartisan support. Modelled on the nonpartisan Congressional Budget Office, this new agency would track the progress of regulations toward completion and notify oversight committees when agencies miss deadlines. Regulatory policy is astonishingly complex; the CRAO’s experts could provide direct regulatory research support to committees and individual members. The CRAO also could critically examine agencies’ cost-benefit calculations, which almost inevitably declare proposed regulations will provide a net benefit to America.

Such an agency would not be expensive. The CBO costs less than $50 million per year and CRAO could be set up for much less. Those who think we can’t afford a CRAO should consider this: an outside assessment of proposed dishwasher-efficiency rules estimate they will cost the public $5 billion more than their estimated environmental benefits. That’s just one regulation. Each year executive agencies issue about 80 major rules with economic effects of $100 million or more. By making regulations smarter and regulators more responsive to the public, the CRAO would more than cover its paltry cost.

How the Clean Power Plan is like the Death Star

August 05, 2015, 12:20 PM

Trigger warning: Nerdy analogies; some discussion of taxes.

On Monday, the Obama administration released the final version of its “Clean Power Plan,” which mandates a 32 percent reduction in carbon-dioxide emissions from 2005 levels by 2030.

The rule, which runs for more than 1,500 pages (not counting technical appendixes) is full of lengthy discussions on matters ranging from its own legality (dubious) to calculations of the amount of increased heat-rate efficiency obtainable from power plants in different regions.

But what the rule really reminded me of, more than anything else, was the Death Star.

The Obama administration’s Death-Star governance

As you’ll recall, unless you’ve just awoken from a 40-year coma, the Death Star was the giant space station the bad guys built in the original “Star Wars” movie. At the beginning of the film, the Empire has just freed itself from the last vestiges of legislative control by abolishing the Republican Senate. This centralization of executive power has raised questions of how the Empire will continue to govern faraway planetary systems.

The Death Star, which is capable of destroying entire planets, is supposed to resolve this problem by allowing the Empire to present recalcitrant local governments with a choice: go along, or we will destroy you. In the words of Grand Moff Tarkin: “Fear will keep the local systems in line; fear of this battle station!”

If you have a fevered conservative brain like mine, the parallels to the new Environmental Protection Agency (EPA) rule are pretty obvious. After being unable to get a cap-and-trade plan through the Senate, the Obama administration decided to sidestep Congress altogether by having the EPA impose reductions directly on each individual state. If a state chooses not to comply, it risks getting zapped by a federal plan that could be highly damaging to its economy and electric reliability.

The Clean Power Plan’s exhaust port

As imposing as the Death Star was, it also had a hidden weakness: a small exhaust port that, if it sustained a direct hit, could set off a chain reaction destroying the entire station. Similarly, the Clean Power Plan contains a provision that, if properly exploited, could nullify many of the rule’s otherwise harmful effects.

On page 899 of the rule, the EPA indicates that a state could be deemed in compliance with the rule through “imposition by a state of a fee for CO2 emissions from affected [electrical generating units, i.e., power plants].” EPA goes on to say that this “plan type would allow the state to implement a suite of state measures that are adopted, implemented and enforceable only under state law” (emphasis added).

This means a state has the option of ignoring most of the previous 898 pages of the rule, with its discussions of improved heat-rate efficiency or dispatch priority for renewable generation. It can instead simply impose a modest fee on carbon-dioxide emissions from electrical generation. This system would be a matter of state law, and unlike most EPA-imposed plans, the details would not be federally enforceable. What’s more, any revenues from the fees could be tied to comparable cuts to state taxes to ensure the overall scheme doesn’t grow the size of government.

A back-up plan for other attacks

Even most hardcore climate skeptics will concede that if you had to reduce CO2 emissions, a carbon fee would be preferable to command-and-control regulation. By making the fee revenue-neutral, states could offset much, if not all, of the economic damage the CPP otherwise would impose on the economy. Effectively, states that choose this route can keep the EPA’s hands off their electrical grids while simultaneously cutting taxes.

None of this is to say that states shouldn’t challenge the Clean Power Plan in court or that conservatives shouldn’t seek legislative repeal of EPA’s authority. But given the current make-up of the Supreme Court and the Washington establishment, it would be nice if there were a back-up plan in case Justices John Roberts and Anthony Kennedy end up acting like, well, Roberts and Kennedy.

The Clean Power Plan may be a clear example of executive overreach, but the details of the final rule provide states an opening to get out from under its most onerous requirements if they choose. At the risk of a horrible pun, that should provide us all with “a new hope.”

White House finalizes CPP, but will it stand?

August 04, 2015, 4:04 PM

President Barack Obama yesterday released long-awaited regulations intended to reduce carbon emissions from the power sector by 30 percent by 2030. The stakes are high. Designed under decades-old legislation, the rules aim to achieve carbon reductions by radically expanding the government role in electricity markets and reshaping the markets themselves.

The rules expand government, increase electricity costs and burden power producers and their customers, without making much progress on climate change. When you add them to the administration’s six other major regulatory initiatives on carbon, as well as the carbon reductions achieved by the broad market switch from coal to natural gas, the administration’s climate plan still falls well short of carbon reduction commitments pledged by the president to the international community.

Energy interests and conservatives in Congress have been pushing back against these regulations since they first were proposed last June. Most recently, 26 members of the House and Senate have asked the White House’s regulations chief to be sure the rules will not require states to comply before the inevitable legal challenges can be resolved by the courts.

It’s an important point. This tension between compliance and litigation timelines is why Murray Energy and 12 states challenged the regulations before they were finalized (Murray Energy Corp. v. Environmental Protection Agency). Dismissed in June by the D.C. Circuit Court, the challenge was designed to settle whether the regulations were legal before states had to grapple with carbon reductions.

We have reason to be concerned. In a separate case, Michigan v. EPA, the Supreme Court in June remanded a different EPA rule to the lower court, stating that the agency had inappropriately failed to consider costs in deciding to issue the rule.

The rule that troubled the court was “Utility MACT,” which established technology standards for reducing hazardous pollutant emissions like mercury from power facilities. EPA predicted the rule would cost the power sector and its customers $9.6 billion per year. The resulting benefits from reducing hazardous pollutant emissions amount to a whopping $0.5 to $6 million.

As Justice Antonin Scalia wrote in the majority opinion, “one would not say that it is even rational, never mind ‘appropriate,’ to impose billions of dollars in economic costs in return for a few dollars in health or environmental benefits.” Counting reductions in other pollutants, the EPA estimates so-called “co-benefits” of the rule to be as much as $89 billion, which ultimately helped the rule survive a cost-benefit test.

The legitimacy of implementing a regulation justified only by its ancillary benefits certainly should be questioned. If there are so many achievable benefits left on the table from reducing other types of emissions, aren’t there probably cheaper ways to achieve those reductions?

But an even greater concern is that the Supreme Court didn’t make its decision on Utility MACT until June 2015; the deadline for achieving reductions was April 2015. The EPA crafted a rule that ultimately was unable to survive a legal challenge, but still induced compliance and passed nearly $10 billion in costs along to taxpayers.

Tight compliance timelines are a clear point of difficulty for power providers. Regulations get baked into years-long capital planning and investment processes for generation facilities. That means operators started making decisions about the April 2015 compliance deadline as soon as the regulation was finalized.

Even those facilities that were given an additional year to comply with the Utility MACT regulations already have made their investments and scheduled outages to install the expensive scrubber technology or switch to natural gas. The decision in Michigan v. EPA, at most, affects only about 22 plants, or 1 percent of the power supply; the rest either have already complied with the rule or have closed.

The Michigan ruling clearly vindicates efforts to resist the Clean Power Plan. When Senate Majority Leader Mitch McConnell, R-Ky., tells states not to comply with the regulations until the Supreme Court has heard the inevitable challenge, he is erring on the side of caution. The Ratepayer Protection Act, introduced by Rep. Ed Whitfield, R-Ky., is a backstop against forcing compliance until we have certainty over whether the regulation will stand. The Clean Power Plan, by design, will overhaul electric generation, dispatch systems and state-level energy laws. If the court finds yet again the administration has inappropriately interpreted a law to fit its regulatory agenda, those efforts will be for naught.

The consistent conservative opposition to the White House’s unrelenting regulatory pressure on the fossil-energy industry is an important counterpoint to an ambitious environmental agenda poorly founded in the law. We have achieved tremendous improvements in environmental quality and expanded economic opportunity while sticking to the letter of the law. If anything, Michigan should remind regulators that they compromise both their goals and industry confidence when straying from congressional intent.

That’s what makes the recent letter from congressional conservatives so important. Supported by, among many others, Senate Environment and Public Works Chairman Jim Inhofe and House Energy and Commerce Chairman Fred Upton, it clearly declares Congress’ intent to eliminate damaging and expensive executive branch overreach. Especially in the wake of the Michigan decision, the EPA and the White House should tread carefully on their latest regulatory effort.

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Study: Agencies miss rulemaking deadlines half the time

August 04, 2015, 10:52 AM

From The Hill:

Federal Agencies have missed half of their Congressional deadlines in the last two decades, according to a new study released by the R Street Institute on Tuesday.

In analyzing data from the Office of Management and Budget, Scott Atherley, an associate fellow at the D.C.-based think tank, found that unrealistic guidelines set by Congress and a lack of consequences for agencies that fail to comply were the main reasons for missed rulemaking deadlines.

“One might argue that these are exceptional cases, but unfortunately, deadline compliance is a systemic problem. Data collected for this analysis suggest that federal agencies failed to meet more than 1,400 deadlines between 1995 and 2014, which translates into an estimated success rate of less than 50 percent,” Atherley said in his study.

Given the number of missed statutory deadlines each year and the other massive demands on Congress’ time, Atherley said oversight tends to be neglected.

The study, however, found that agencies are far more likely to comply with deadlines set by a court order rather than Congress. The overall compliance rate for judicial deadlines during the years studied was nearly 80 percent.

With a compliance rate at nearly 90 percent, the study found that Department of Interior and the Environmental Protection Agency has little trouble meeting judicial deadlines.

To improve agency compliance with statutory deadlines, Atherley recommends the Congress require agencies to report their progress.

“Congress cannot monitor federal agencies effectively without a system dedicated to tracking directives and following up to evaluate agency responsiveness,” he said in the report.  

He also recommended Congress establish a new Regulatory Affairs Office to track agency compliance.

Federal agencies missed half their congressional deadlines

August 04, 2015, 9:40 AM

WASHINGTON (Aug. 4, 2015) – Federal agencies over the past two decades have a less than 50 percent success rate in complying with congressional rulemaking deadlines, according to a new study released today by the R Street Institute.

In his analysis of Office of Management and Budget data compiled since 1996, R Street Associate Fellow Scott Atherley found that two of the strongest reasons for missed deadlines were unrealistic guidelines set by Congress and a lack of consequences for agencies that fail to comply.

“Congress often is the only party to suffer any form of harm from a neglected deadline, yet cannot in practice sue the agency in question,” Atherley wrote. “If no party has standing to sue over an unmet deadline, legal recourse is extremely difficult to achieve. Congress’ only option is to pass another law.”

Atherley notes that agency deadlines set by the courts have a much higher success rate, at almost 80 percent, suggesting that agencies treat court-ordered deadlines as higher priorities than deadlines developed by Congress. Oversight of judicial deadlines frequently is conducted by the outside groups who brought suit.

In order to improve agency compliance with statutory deadlines, more detailed information regarding agencies’ progress in meeting statutory regulatory deadlines needs to be recorded and made available.

“The analysis is limited by the lack of detailed data linking statutory directives to specific required actions,” wrote Atherley. “Congress cannot monitor federal agencies effectively without a system dedicated to tracking directives and following up to evaluate agency responsiveness.”

Reporting requirements could be updated to include more detail, such as recording the precise action required by Congress. Policymakers would benefit from a database in which agencies record regulatory milestones as they complete them, the paper contend.

Additionally, Atherley argues that Congress would benefit greatly from an organization or office devoted to legislative engagement with the regulatory process. Atherley also noted that Congress would benefit from an institution empowered to litigate on its behalf.

“A Congressional Regulatory Affairs Office tasked with making and tracking requests of federal agencies could save time and effort for both congressmen and agency officials,” he wrote. “There are likely large numbers of unnecessarily complex, duplicative or unclear requests issued from legislators to civil servants.”

Federal agency compliance with congressional regulatory deadlines

August 04, 2015, 8:00 AM

The final years of the Obama administration, like the Bush administration before it, have been characterized by acrimonious debates over executive power and accountability. Regulatory deadlines are just one area in which the legislative and executive branches fail to see eye to eye. The ongoing implementation of the Patient Protection and Affordable Care Act (ACA) is a case in point. A 2012 American Action Forum report found that federal agencies had missed 47 percent of deadlines associated with the ACA. Similar analyses by Avik Roy indicate that roughly half of the mandated regulations associated with the ACA were either completed late or not completed at all.

Problems with Congressional deadlines go beyond the ACA: a June 2012 report by the liberal advocacy group Public Citizen analyzed 159 regulations subject to statutory deadlines in 2011 and found that agencies failed to complete 78 percent of required actions within the time-period allotted. Low levels of statutory deadline compliance are a concern to those on both ends of the political spectrum.

One might argue that these are exceptional cases, but unfortunately, deadline compliance is a systemic problem. Data collected for this analysis suggest that federal agencies failed to meet more than 1,400 deadlines between 1995 and 2014, which translates into an estimated success rate of less than 50 percent.

Interestingly, deadlines set by the judicial branch are met at a considerably higher rate – nearly 80 percent. The disparity in compliance rates emerges, in part, from the disparate legal treatment of different types of deadlines and from congressional incentives to engage in oversight. The fact that different deadlines generate different results suggests that deadline compliance can be improved by making oversight easier and by making statutory deadlines directly enforceable.

White House offers tepid response on email privacy

August 04, 2015, 7:00 AM

As we have previously noted, proposed reforms to the Electronic Communication Privacy Act recently have received increased attention. Congress appears on the verge of finally restoring email privacy protections to all emails even correspondence over 180 days old.

As of the writing of this post, H.R. 699, the Email Privacy Act, has 292 cosponsors.  Sponsored by Rep. Kevin Yoder, R-Kan., the measure is still the most-supported bill in this Congress not to receive a hearing, much less a vote.

Back in 2013, in an effort to draw attention to the outdated 1986 law governing email privacy, activists started an online White House petition calling on the Obama Administration “to support ECPA reform and to reject any special rules that would force online service providers to disclose our email without a warrant.”

The petition received 113,035 signatures within 30 days, triggering the White House to fulfill a self-imposed requirement to write a response.

Last week, after 18 months of silence the White House finally responded. The administration acknowledged that “some of ECPA’s components therefore seem outdated” and “should be reformed,” but deferred responsibility to Congress to hash out the actual fix.

Privacy activists were disappointed the administration’s statement didn’t go further. Tech Dirt observed that the “administration agrees that reform of this law… is needed. However, it does so both belatedly, vaguely and disingenuously.”

This is especially disappointing because many of the government agencies that are accessing (or potentially accessing) old emails without a warrant exist within the executive branch, such as the FBI and the IRS. Instead of closing access to private correspondence, “the administration will not force federal agencies to get a warrant to access older emails.”

As Congress prepares to debate the right balance on email privacy, it isn’t quite clear how supportive or opposed the White House will be of the final product. One hopes Congress will not be deterred by the administration’s lukewarm input and instead build off the support they have tech sector and grassroots excitement to restore Fourth Amendment protections to email.

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