Government Knows Best – Federal Agencies Plow Ahead Without Public Input

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If you were dismayed by the backroom deals and political horse trading that brought you the massive health care and financial reform bills, hold on to your hats—you ain’t seen nothing yet!

Americans have long been fascinated—and often disgusted—by how Congress passes laws. Many citizens became irate when they learned that most members of Congress hadn’t even read the health care bill, which clocked in at about 2,300 pages. Speaker Nancy Pelosi said famously, “We need to pass the health care bill to find out what’s in it.”

But after a bill is signed into law, most Americans lose interest. That’s unfortunate, because that’s when many of the most important decisions are made—“behind the scenes.” The massive health care bill leaves major decisions to the regulators who will implement the legislation. It authorizes over a hundred rulemakings, and grants an unprecedented amount of discretion to federal departments and agencies, like the Department of Health and Human Services and the Internal Revenue Service.

The federal government has already begun writing regulations and rules to fill in the gaps. Unfortunately, the administration is abusing the rulemaking process, poisoning it with the same lack of transparency and steamrolling tactics used to pass the underlying bill.

Regulations matter; they have the force of law, but they are never voted on by your representatives in Congress. The system is supposed to guarantee transparency, fairness, and input from affected parties. In fact, in 1946 Congress enacted a law called the Administrative Procedure Act (APA) that was designed to keep the federal agencies accountable to people when they draft rules. It laid out a straightforward process wherein agencies first must issue a proposed version of a regulation with reasonable time for the public to comment on the proposal, before issuing a final rule. The thought was that the government could benefit from the input of those in the real world who will have to comply with the new regulation before it hardens into final form—a pretty logical assumption!

Unfortunately, these safeguards are being subverted by the administration with the issuance of so-called “interim-final” regulations, which become effective before comments are collected and evaluated by the agencies. The U.S. Chamber of Commerce has already counted at least ten different times where agencies skipped these steps.

The administration claims the rush is justified because of the timeframe in which provisions of new laws come into effect. But this is a problem created by the administration itself when it jammed through the health care legislation without thought to these important steps. Yes, the agencies are ostensibly collecting comments on the “interim-final” rules, but as the courts have noted, this is akin to giving an artist recommendations on his painting after the canvas has already dried.

As a trade organization, one of the Chamber’s most important responsibilities is to represent our members in the federal rulemaking process. It takes time to communicate with businesses, to find out what is most important to them in a given regulation, and then to compile and prioritize comments. In a just system, we can communicate with regulators at the outset, before they draft proposed rules, to explain to them the true challenges and needs of employers relating to implementing new laws. This advocacy protects jobs.

It is critically important that the government listen to the people who will be affected by regulations. If offering health insurance becomes too much of a burden on employers, they will consider dropping coverage. The more complicated it becomes to hire and retain workers, the more hesitant businesses will be to expand and create jobs. The tougher it is to obtain capital, the fewer opportunities there will be for entrepreneurs and small businesses to start or expand their operations. Regulations need to work for employers so that they can stay focused on their primary business, rather than be mired in complicated and unworkable government rules.

Thomas Jefferson wrote in the Declaration of Independence that “Governments are instituted among Men, deriving their just powers from the consent of the governed.” As we watched the Senate jam through a massive health care bill on Christmas Eve against the will of a majority of Americans, we had to wonder whether Congress cared about the consent of the governed. Now it is time to ask if the administration cares, and if they do, why are they not interested in listening to the concerns of those who will be governed by regulations before they develop them?

Randel K. Johnson is the Senior Vice President of Labor, Immigration, and Employee Benefits at the U.S. Chamber of Commerce, and James P. Gelfand is the Director of Health Policy at the U.S. Chamber of Commerce.