Nation should reach for low hanging fruit in trimming regulation

President Trump’s broad executive order on Jan. 30, prohibiting federal agencies from issuing a single new regulation without also eliminating two existing ones has raised a slew of questions and challenges to be answered.

It’s a sweeping, fundamental policy change, with little in the way of guidance about how to implement such a radical regulatory-reducing process.

Determining where to start cutting regulations under the new 2-for-1 order presents some prickly legal issues, as clearly evidenced by a lawsuit filed last week by the Public Citizen Litigation Group, National Resources Defense Council, and Communications Workers of America. In their complaint, the three plaintiffs allege the President’s order represents an “impermissible and arbitrary choice — whether to issue a new standard at the cost of the loss of benefits of two existing standards.”

{mosads}Cost-benefit analyses conducted in the realm of government regulations are typically lengthy and complex processes — from the initial identification of a specific need to protect health and safety, to the public notice and comment process which precedes final rules. Untangling the monolithic mass of regulation accreted over the last century, without losing the associated benefits that have accrued to society in the process, clearly needs to be done with care.

The question arises, where to start picking the low-hanging fruit in response to the chief executive’s newly ordered 2-for-1 requirement, to enable the continued creation of regulations that protect health and safety, without eliminating existing rules which still provide unique social benefits? 

In the words of NRDC President Rhea Suh, “New efforts to stop pollution don’t automatically make old ones unnecessary.”

It seems to me one of the most logical place to begin searching for regulations to chop are cases where rules are clearly duplicative in their main purpose – in other words, so-called redundant regulations.

By definition, if two different rules were created to achieve the same end, and both actually do the job, eliminating one will have no net-change to society’s overall health and welfare. The remaining rule should continue to achieve the desired benefit, as the system sheds away the redundant rule.

In one example of low-hanging fruit of regulatory redundancy cut without causing detriment, the Environmental Protection Agency in 2013 eliminated a requirement in many states for air-pollution vapor-recovery nozzles on gas-station pumps. The justification for this particular rule-cut stemmed from the fact that gas-tank covers on most vehicles today are designed to serve the same purpose – the very definition of regulatory redundancy.

Eliminating this one compliance requirement for gas stations in some states to own and maintain vapor-recovery equipment saved businesses an estimated $67 million annually.

Another example of regulatory redundancy identified by James Cooper in the journal Law & Economics involves online travel agencies, an industry which generates over $100 billion in annual revenue and currently falls under the jurisdiction of both the FTC and the Department of Transportation. 

“This regulatory redundancy guarantees that two agencies will oversee OTAs prevents harmonization of online consumer protection policy, and is likely to impose unnecessary costs on OTAs to adhere to two separate regulatory regimes,” Cooper argued.

In the case of OTAs, Cooper recommends simply shifting regulatory jurisdiction completely to the FTC, whose agency culture is better suited than the DOT to address consumer-protection issues of primary concern with regard to travel agencies.

The above examples are but two cases of redundancy in a massive regulatory system built up over the course of seven decades, since the Administrative Procedures Act of 1946 which defines and empowers the modern executive branch. Identifying every instance of redundancy within this complex system, which has an estimated impact of $2 trillion annually on the U.S. economy, will require a Herculean analytical effort.

Fortunately, there are new analytical tools available to speed up and enhance the task of identifying regulatory redundancies. In particular, Natural Language Processing technology can draw connections among the vast universe of words contained in millions of documents which form the basis of the regulatory system. NLP in effect can provide those charged with finding redundant rules with a virtual map by which to navigate the otherwise mind-numbing complexity of rule making verbiage and overlapping jurisdictions.

Using the most advanced data analytics technology and best practices to isolate and evaluate rules for potential elimination without exposing society to harmful impacts could negate claims of arbitrariness, such as the one made against the President by the three lawsuit plaintiffs referenced above.

As for their claim the chief executive’s two-for-one rule-cutting requirement is “impermissible,” I will leave for discussion another day.

John W. Davis II, is founder and chief executive officers of N&C, provider of the regulatory data analytics solution Regendus. Davis previously served as director of the Homicide and Major Crimes Bureau as federal prosecutor for the U.S. Virgin Islands Justice Department.

The views expressed by contributors are their own and are not the views of The Hill.