    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

     REINS ACT--PROMOTING JOBS AND EXPANDING FREEDOM BY REDUCING NEEDLESS
                                  REGULATIONS

    =======================================================================

                                    HEARING

                                   BEFORE THE

                       SUBCOMMITTEE ON COURTS, COMMERCIAL
                             AND ADMINISTRATIVE LAW

                                     OF THE

                           COMMITTEE ON THE JUDICIARY
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                                JANUARY 24, 2011

                                   __________

                                Serial No. 112-7

                                   __________

             Printed for the use of the Committee on the Judiciary

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          Available via the World Wide Web: http://judiciary.house.gov

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                           COMMITTEE ON THE JUDICIARY

                          LAMAR SMITH, Texas, Chairman
    F. JAMES SENSENBRENNER, Jr.,         JOHN CONYERS, Jr., Michigan
        Wisconsin                        HOWARD L. BERMAN, California
    HOWARD COBLE, North Carolina         JERROLD NADLER, New York
    ELTON GALLEGLY, California           ROBERT C. ``BOBBY'' SCOTT,
    BOB GOODLATTE, Virginia                  Virginia
    DANIEL E. LUNGREN, California        MELVIN L. WATT, North Carolina
    STEVE CHABOT, Ohio                   ZOE LOFGREN, California
    DARRELL E. ISSA, California          SHEILA JACKSON LEE, Texas
    MIKE PENCE, Indiana                  MAXINE WATERS, California
    J. RANDY FORBES, Virginia            STEVE COHEN, Tennessee
    STEVE KING, Iowa                     HENRY C. ``HANK'' JOHNSON, Jr.,
    TRENT FRANKS, Arizona                  Georgia
    LOUIE GOHMERT, Texas                 PEDRO PIERLUISI, Puerto Rico
    JIM JORDAN, Ohio                     MIKE QUIGLEY, Illinois
    TED POE, Texas                       JUDY CHU, California
    JASON CHAFFETZ, Utah                 TED DEUTCH, Florida
    TOM REED, New York                   LINDA T. SANCHEZ, California
    TIM GRIFFIN, Arkansas                DEBBIE WASSERMAN SCHULTZ, Florida
    TOM MARINO, Pennsylvania
    TREY GOWDY, South Carolina
    DENNIS ROSS, Florida
    SANDY ADAMS, Florida
    BEN QUAYLE, Arizona

          Sean McLaughlin, Majority Chief of Staff and General Counsel
           Perry Apelbaum, Minority Staff Director and Chief Counsel
                                     ------

           Subcommittee on Courts, Commercial and Administrative Law

                     HOWARD COBLE, North Carolina, Chairman

                   TREY GOWDY, South Carolina, Vice-Chairman

    ELTON GALLEGLY, California           STEVE COHEN, Tennessee
    TRENT FRANKS, Arizona                HENRY C. ``HANK'' JOHNSON, Jr.,
    TOM REED, New York                     Georgia
    DENNIS ROSS, Florida                 MELVIN L. WATT, North Carolina
                                         MIKE QUIGLEY, Illinois

                          Daniel Flores, Chief Counsel

                          James Park, Minority Counsel

                                C O N T E N T S

                                  ----------

                                JANUARY 24, 2011

                                                                       Page

                               OPENING STATEMENTS

    The Honorable Howard Coble, a Representative in Congress from the
      State of North Carolina, and Chairman, Subcommittee on Courts,
      Commercial and Administrative Law..............................     1
    The Honorable Steve Cohen, a Representative in Congress from the
      State of Tennessee, and Ranking Member, Subcommittee on Courts,
      Commercial and Administrative Law..............................     3
    The Honorable Lamar Smith, a Representative in Congress from the
      State of Texas, and Chairman, Committee on the Judiciary.......     4
    The Honorable John Conyers, Jr., a Representative in Congress
      from the State of Michigan, and Ranking Member, Committee on
      the Judiciary..................................................     6

                                   WITNESSES

    The Honorable David McIntosh, Mayer Brown LLP
      Oral Testimony.................................................    21
      Prepared Statement.............................................    23
    Jonathan Adler, Professor, Case Western Reserve University School
      of Law, Director, Center for Business Law and Regulation
      Oral Testimony.................................................    76
      Prepared Statement.............................................    78
    Sally Katzen, Visiting Professor, New York University School of
      Law, Senior Advisor, Podesta Group
      Oral Testimony.................................................    86
      Prepared Statement.............................................    88

              LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

    Prepared Statement of the Honorable John Conyers, Jr., a
      Representative in Congress from the State of Michigan, and
      Ranking Member, Committee on the Judiciary.....................     8
    Prepared Statement of the Honorable Steve Cohen, a Representative
      in Congress from the State of Tennessee, and Ranking Member,
      Subcommittee on Courts, Commercial and Administrative Law......    13
    Prepared Statement of the Honorable Henry C. ``Hank'' Johnson,
      Jr., a Representative in Congress from the State of Georgia,
      and Member, Committee on the Judiciary.........................    16
    Prepared Statement of the Honorable Mike Quigley, a
      Representative in Congress from the State of Illinois, and
      Member, Subcommittee on Courts, Commercial and Administrative
      Law............................................................    19
    Prepared Statement of the Honorable Trey Gowdy, a Representative
      in Congress from the State of South Carolina, and Member,
      Subcommittee on Courts, Commercial and Administrative Law......   102
    CRS Report submitted by the Honorable John Conyers, Jr., a
      Representative in Congress from the State of Michigan, and
      Ranking Member, Committee on the Judiciary.....................   117

                                    APPENDIX
                   Material Submitted for the Hearing Record

    Responses to Post-Hearing Questions from Sally Katzen, Visiting
      Professor, New York University School of Law, Senior Advisor,
      Podesta Group..................................................   140
    Report from the Center for Progressive Reform (CPR)..............   142

     REINS ACT--PROMOTING JOBS AND EXPANDING FREEDOM BY REDUCING NEEDLESS
                                  REGULATIONS

                                  ----------

                            MONDAY, JANUARY 24, 2011

                  House of Representatives,
                        Subcommittee on Courts,
                     Commercial and Administrative Law,
                                    Committee on the Judiciary,
                                                        Washington, DC.

        The Subcommittee met, pursuant to notice, at 4 p.m., in
    room 2141, Rayburn House Office Building, the Honorable Howard
    Coble (Chairman of the Subcommittee) presiding.
        Present: Representatives Coble, Smith, Gowdy, Gallegly,
    Franks, Reed, Ross, Cohen, Conyers, Johnson, Watt, and Quigley.
        Staff present: (Majority) Daniel Flores, Subcommittee Chief
    Counsel; Olivia Lee, Clerk; and Carol Chodroff, Minority
    Counsel.
        Mr. Coble. The Subcommittee will come to order. I was going
    to welcome all the new Members to the Subcommittee, but Mr.
    Cohen and I appear to be it. So good to have you on board, Mr.
    Cohen, and Mr. Gowdy on my right.
        Ground rules, folks. I like to start on time, and I like to
    end on time. I hope that is agreeable with everybody. You are
    familiar perhaps with the 5-minute rule. And the 5-minute rule,
    folks, is not done in any way to frustrate debate but rather to
    facilitate the process. Our jurisdictional bounds are broad,
    indeed, and we will hustle along and do the best we can. So
    when you see that red light appear, that will be your signal
    that your 5 minutes have elapsed. And Mr. Cohen and I will not
    call in the U.S. Marshal on you then, but you need to wrap up.
    The 5-minute rule also applies to Members of the Subcommittee.
    We will try to adhere to that as well.
        I want to give my opening statement, and I will recognize
    Mr. Cohen for his opening statement. Other opening statements
    will be made part of the record at the conclusion. Is that
    agreeable with everybody?
        Today marks the first hearing of the newly constituted
    Subcommittee on Courts, Commercial and Administrative Law. And
    I think we are going to have Mr. Smith with us, but he is not
    hereyet. Chairman Smith has provided our Subcommittee with
    jurisdiction over a number of important matters that I hope our
    Subcommittee will address during the 112th Congress.
        In my view, one of the most important matters is to fine
    tune our regulatory process; hence, the introductory oversight
    hearing on the REINS Act.
        Many in the private sector have alleged that the Obama
    administration has cast a cloud of regulatory uncertainty over
    some parts of the economy. While it is no secret that our
    economy is still soft, perhaps even dismal, unnecessary or
    unreasonable regulatory burdens will continue to drive business
    investments, in my way of thinking, abroad.
        Examples of the need for improvement are prevalent in
    virtually every sector of government regulation. For instance,
    the Department of Health and Human Services' implementation of
    President Obama's health care reform, the financial agency's
    implementation of the Dodd-Frank financial reform bill, the
    EPA's campaign against carbon dioxide, the FDA's approach to
    herbicide, and the Federal Communication Commission's drive to
    regulate the Internet and allocate spectrum.
        I only mention these examples because they are widely
    recognized, and the fact of the matter is that fine-tuning is
    needed across the entire regulatory horizon.
        Our current regulatory regime has deep historic roots.
    Since the days of the New Deal, and especially during the
    1960's and 1970's, Congress has delegated more and more of its
    legislative authority to Federal agencies. This has been done
    through broad and vaguely stated laws that allow Congress to
    claim credit for addressing problems but leaves it to the
    various agencies to fill in the crucial details through
    regulations. The final risk of the wrong decision thus falls on
    the agencies and, of course, the economy and America's job
    creators. Congress too often escapes both responsibility and
    accountability.
        The Republican majority that came to Congress in 1994
    attempted to address this problem through the Congressional
    Review Act. That act, you may recall, gave the Congress greater
    tools to disapprove agency regulations that harm the economy,
    destroy jobs, or otherwise were counterproductive. Over its
    history, however, the Congressional Review Act has not
    fulfilled its potential.
        During the 108th and 109th Congresses, the Subcommittee on
    Commercial and Administrative Law examined ways to improve the
    Congressional Review Act and better assert Congress's authority
    over legislative regulations. One of the leading ideas for
    reform was to amend the Act to preclude regulations from going
    into effect until Congress actually approve them. That is
    precisely what the REINS Act does for the biggest regulations
    Federal agencies issue, those imposing $100 million or more in
    costs on our economy.
        Today, more than ever, we must consider and enact reforms
    that vindicate Congress's authority over the laws. The REINS
    Act is front and center among those reforms.
        Before reserving the balance of my time, I would like to
    extend a warm welcome to our former colleague, Congressman
    David McIntosh--it is good to have you back on the Hill--as
    well as the other witnesses.
        And Mr. Cohen, I said this before our other colleagues came
    in, but it is good to have all Members, Republican and Democrat
    alike, on this Subcommittee. And now I am pleased to recognize
    the distinguished gentleman from Tennessee, Memphis to be
    specific, Mr. Cohen.
        Mr. Cohen. Thank you, Mr. Chair. And I appreciate that. As
    you know, Tennessee was originally North Carolina, so, in some
    ways, we are colleagues beyond being colleagues here.
        And I would like to first pay specific attention to, for
    the new Members and others, to my Ranking Member of the
    Committee, the distinguished, the venerable, the honorable, the
    legendary John Conyers. Nice to be with you.
        And Chairman Smith and all the other Members, I look
    forward to serving with each of you as well, who is not
    legendary yet, but he is honorable and a few of those other
    things that we will incorporate by reference.
        Mr. Coble. Would the gentleman yield just a moment. I
    didn't realize that Chairman Smith had come in. I didn't mean
    to ignore you, Lamar.
        Is Mr. Conyers here as well? Good to see you again.
        Mr. Cohen. I would like to start by offering my
    congratulations to Mr. Coble, who assumed the Chairmanship of
    the Committee. And when I was Chairman, he was as nice as
    anybody was to me. Everybody was nice, but he was particularly
    nice, and I was always appreciative of that.
        You are a gentleman, and I look forward to working with
    you.
        Mr. Franks was an outstanding Ranking Member, and we worked
    together nicely, and I look forward to serving with him.
        I am honored to be working as Ranking Member, although I
    would rather be working as Chairman, but that is this Congress.
        Today's hearing provides us with the opportunity to debate
    the merits of H.R. 10, the ``Regulations from the Executive In
    Need of Scrutiny Act,'' or REINS. It also gives us a chance to
    discuss the appropriate role of Federal regulations in American
    life, a conversation I suspect we will continue to have in this
    Subcommittee in the 112th Congress.
        Although they do not explicitly say, proponents of the
    REINS Act appear to believe that almost all regulations are
    bad. All their arguments focus on the purported costs that
    regulations impose on society. Based on this premise, we have
    heard rhetoric about job killing regulation that will stifle
    economic growth and impair personal freedom.
        What such arguments do not seem to fully appreciate is
    regulations can also benefit the economy by policing reckless
    private-sector behavior that could undermine the Nation's
    economic well-being, and came very, very close to doing it in
    2008. Lack of regulations and the economy of the world was on a
    precipice, pulled off by President Bush and bipartisan Members
    of the Congress in passing the TARP and successive legislation
    with the Stimulus Act. We learned that the hard way in the 2008
    financial crisis and the problems that ensued there from.
        We can look back to the Great Depression, when there was
    even more independence from regulations and lack of regulation,
    and see what followed there, the Great Depression.
        Regulations can facilitate economic activity by providing
    clarity for regulated industries where the applicable statutory
    language may be too broad or too vague and lead to unnecessary
    confusion or even litigation.
        Regulations can also serve societal values that may
    outweigh economic growth.
        Most importantly, regulations help protect the health and
    safety of everyday Americans, including our children, our
    neighbors, our colleagues, our grandparents, and ourselves and
    the public at large.
        The fact is that Federal regulations help ensure the safety
    of the food that we eat, the air that we breathe, the water
    that we drink, the products we buy, the medications we use, the
    cars we drive, the planes we fly in, and the places we work.
    Indeed, most Americans are able to take for granted the safety
    of these things assured because of the existence of Federal
    regulations.
        The REINS Act threatens to make it harder for such
    beneficial regulations to be implemented. Under the Act,
    Congress must approve a major rule, one having an economic
    impact of $100 million or more, by passing a joint resolution
    of approval through both Houses of Congress within 90--70
    legislative days after the rule is submitted to Congress. The
    President must then sign the joint resolution of approval
    before the rule can go into effect.
        At the most practical level, I question whether the REINS
    Act could work. I have been in Congress long enough to
    understand that the crush of business before us will more often
    than not prevent us from giving due consideration and approval
    to the many rules that may be beneficial and even ultimately
    enjoy widespread support if we were to implement the REINS Act.
        As with the Congressional Review Act, the underlying
    statute that the REINS Act seeks to amend, this idea may seem
    better in the abstract than it will be in practice.
        Of course, I am not ready to say the REINS Act is a good
    idea even in the abstract. While I appreciate the attempt to
    reassert some congressional control over agency rulemaking,
    there are separation of powers that I think were spoken to
    Members of Congress about recently, and Justice Scalia I think
    led that talk. And there could certainly be constitutional
    objections with separation of powers to the REINS Act, which we
    will hear from our witnesses. There is a role for us. There is
    a role for the executive. There is a role for the judiciary.
        I look forward to our witnesses testimony. I look forward
    to working with Chairman Coble and my other colleagues on the
    Subcommittee for hopefully a meaningful 112th Congress.
        I yield back the remainder of my time.
        Mr. Coble. Mr. Cohen, I thank you.
        And I thank you as well for your generous remarks at the
    opening. I appreciate that.
        Statements of all Members will be made a part of the
    record, without objection.
        And I am told that Mr. Smith and Mr. Conyers would like to
    make opening statements, and I recognize the distinguished
    gentleman from Texas, the Chairman of the full Committee, Mr.
    Smith.
        Mr. Smith. Thank you, Mr. Chairman.
        And, Mr. Chairman, thank you for chairing this particular
    hearing, which I think is going to be one of the most important
    of the year.
        As you said, I also welcome our former colleague David
    McIntosh.
        And, David, I hope we get to talk a little bit more later
    on, but appreciate your being here, too.
        Mr. Chairman, the American people in November voted for
    real change in Washington. One change they want is to stop the
    flood of regulations that cost jobs and smothers job creation.
    Yet, another is to make Washington and Congress more
    accountable. The REINS Act makes that change a reality.
        Unelected Federal officials for too long have imposed huge
    costs on the economy and the American people through burdensome
    regulations. Today, these regulatory costs are estimated to be
    a nearly incomprehensible $1.75 trillion dollars, roughly
    $16,000 per household.
        Because the officials who authorize these regulations are
    not elected, they cannot be held accountable by the American
    people. The REINS Act reins in the costly overreach of Federal
    agencies that stifles job creation and slows economic growth.
    It restores the authority to impose regulations to those who
    are accountable to the voters, their elected Representatives in
    Congress.
        The Obama administration has under consideration at least
    183 regulations that each would impose costs of $100 million or
    more on the economy. And when businesses have to spend these
    vast sums to comply with these massive regulations, they have
    less money to invest to stay competitive in the global economy
    and to hire new employees. These costs get passed on to the
    American consumers. In effect, these regulations amount to
    stiff but unseen taxes on every American.
        Last week, in a new Executive Order, President Obama
    reiterated the existing authority of agencies to cull outdated
    rules from the books and consider impacts on jobs when
    regulations are written. This order sounded encouraging but
    added little to the rules that already guide the process of
    regulations. In the Executive Order, ``distributive impacts''
    and ``equity'' are specifically identified among benefits to be
    maximized. Job creation is not.
        The Executive Order is specifically written not to include
    regulations issued to implement the Administration's health
    care legislation, and it carves out independent agencies
    charged to implement the Dodd-Frank financial reform
    legislation. And it won't halt the Environmental Protection
    Agency's drive to exercise authority it was never granted. So
    the most burdensome and costly regulations are exempted.
        The Executive Order, I hope not, may have been all style
    and no substance. Until the Executive Order produces real
    results, it is just a string of empty words. We must watch what
    the Administration does, not what it says.
        In 1994, Congress passed the Congressional Review Act to
    reassert Congress's authority over the relentless regulation of
    the Federal Government. The act has been used just one time to
    disapprove of regulation. The regulatory tide continues and
    rises even higher. The REINS Act is needed to reduce the cost
    of the flood of regulations, free up businesses to create jobs,
    and make the Federal Government more accountable. Thank you,
    Mr. Chairman.
        Mr. Chairman, before I yield back entirely, I would like to
    recognize my colleague sitting back of the room, Geoff Davis,
    who has been absolutely instrumental in promoting, advancing,
    and writing this legislation that we are discussing today.
        Mr. Coble. I thank the gentleman.
        The Chair is pleased to recognize the distinguished
    gentleman from Michigan, Mr. Conyers.
        Mr. Conyers. Thank you, Mr. Coble.
        I join in welcoming our former colleague, Mr. McIntosh,
    back here. It is very important. And I ask unanimous consent
    that the author of the bill, Representative Davis, come
    forward. I think he should be able to make a couple comments
    about the bill. I would welcome his sitting at the table. Since
    there are only three people there anyway, there is plenty of
    room.
        Mr. Coble. Mr. Conyers, I would be pleased indeed to have
    Mr. Davis come forward. I don't believe, though, he would be
    eligible to comment. But we would be glad for him to come
    forward to the table if he would like.
        Mr. Conyers. You say he can't comment on his own bill in
    the Judiciary Committee, the keeper of the Constitution?
        Mr. Coble. Well, Mr. Conyers, he was not called as a
    witness. And that is why I made that statement.
        Mr. Conyers. Okay.
        Well, I have got a few questions I would like to ask him
    after the hearing, then, if I can. I will be looking forward to
    doing that.
        I have got a statement that I will put in the record so we
    can get to our witnesses. But the most important part of my
    statement is that I think we have a constitutional problem on
    our hands, and our former colleague alluded to it himself in
    his statement. And it is found in article II, section 1, that I
    refer all of the distinguished lawyers on this Committee to.
    And I am sure we will have enough time to go into this.
        The second consideration I would like us to keep in mind as
    we go through this important hearing is that the REINS Act may
    not be tailored to the problems that it is supposed to address.
    We have got some big problems with whether this is feasible.
    The feasibility of this act is--well, let's put it like this.
    This would affect every law on the books. It is not
    prospective, but it would involve every law that is on the
    books currently.
        Now, I don't want to suggest that the Congress isn't up to
    its work, but do you know how much time that that would take to
    go through all of the laws to get them, the regulations to the
    laws, okayed by the House and the other body, as we delicately
    refer to them? It doesn't seem very probable that that could
    happen.
        So when you consider the fact that we don't have the author
    of the bill testifying--and we are glad he is here, of course--
    but we also don't have the Administration testifying. Why isn't
    somebody from the Administration here? I mean, how can we be
    doing this? And I have been told by staff that we are going to
    try to report this bill next week sometime.
        So, Chairman Coble, I would like to, with all due respect,
    ask an opportunity to discuss with you the possibility of an
    additional hearing on this matter.
        Mr. Coble. Well, if the gentleman would yield. This is an
    oversight hearing, and there will be a legislative hearing
    subsequently.
        Mr. Conyers. Okay. Well, that is consoling. I am glad to
    find out.
        Now, this is a great new process of order. We do the
    oversight hearing first, and then we have a hearing on the
    bill. That makes a lot of sense. Why don't we have a hearing on
    the bill first? Oh, we are oversighting the condition that has
    caused the bill to be created. Is that right?
        Mr. Coble. This is the oversight hearing. As I say, the
    legislative hearing will be scheduled.
        Mr. Conyers. Okay. All right. Well, then I don't have to
    ask for another hearing. There is going to be another hearing
    on the bill. So I am glad to know that, because I have got a
    witness or two in mind that I would like to have partake with
    all the other distinguished friends of ours that are here with
    us today.
        So I thank you very much, Chairman Coble. And I yield back
    the balance of my time and ask my statement be included in the
    record.
        [The prepared statement of Mr. Conyers follows:]

                                   __________

        Mr. Coble. And all statements of the Members of the
    Subcommittee will be made a part of the record, without
    objection.
        [The prepared statement of Mr. Cohen follows:]

                                   __________
        [The prepared statement of Mr. Johnson follows:]

                                   __________
        [The prepared statement of Mr. Quigley follows:]

                                   __________

        Mr. Coble. We are pleased to have our panel of three
    witnesses with us today.
        As has been mentioned previously, Mr. McIntosh, it is good
    to have you back on the Hill. Mr. McIntosh now practices at
    Mayer Brown LLP in Washington focusing on issues before
    Congress and the executive branch. He is a graduate of the
    University of Chicago School of Law and a cum laude graduate of
    Yale University.
        Professor Jonathan Adler teaches at the Case Western
    Reserve School of Law, where he is the director of Case Western
    Center for Business Law and Regulation.
        Professor Sally Katzen is a visiting professor at New York
    University School of Law, and Professor Katzen also serves as
    senior adviser to the Podesta Group.
        It is good to have each of you with us.
        And we will start with Mr. McIntosh, and we recognize you,
    sir, for 5 minutes.

              TESTIMONY OF THE HONORABLE DAVID McINTOSH,
                            MAYER BROWN LLP

        Mr. McIntosh. Thank you. It is a pleasure to be back.
        And thank you, Mr. Cohen and Mr. Conyers, for your remarks.
        Let me commend the Committee for taking up this question in
    the oversight hearing of the regulatory process and the urgency
    for looking at, are there ways of making it work better to
    reduce the cost of regulations?
        And I want to commend Representative Davis for his work in
    introducing the REINS Act.
        When I was a Member, the Speaker asked me to Chair a
    Subcommittee on oversight just on regulations in the Government
    Reform Committee, and we looked at a lot of the different
    regulatory programs, looked at the overall costs on the
    economy. And I have to say, as I was preparing for the
    testimony today after I received the invitation, I was startled
    at the magnitude of the cost of Federal regulations: $1.75
    trillion annually of costs imposed on the economy, about
    $15,000 per household; and, in particular, on jobs, where for
    large businesses, it costs $7,700 per employee to hire a new
    employee to follow the regulatory dictates of the various
    Federal programs. And for small businesses, it is even more. It
    is over $10,000 per employee.
        As Mr. Cohen pointed out, those are the costs. You need to
    look at the benefits of regulations when you are making policy
    decisions, and Congress does that as it passes the laws, and
    the agencies are required to do that under longstanding
    executive orders. But the problem that I see that has happened,
    and we worked on the Congressional Review Act as a way of
    addressing that, is that balancing act of the particular type
    of mandatory requirements that get set in a regulation versus
    the benefits doesn't come back to Congress for review once the
    legislation has been enacted and the regulatory agency has been
    empowered to act.
        We passed in 1995 the Congressional Review Act as one way
    to increase that formally, but as was pointed out earlier, it
    has only been used one time. And it is difficult for the
    political configuration to work where typically you have got to
    have a resolution of disapproval go through both the House and
    the Senate and signed by the President. I think the only time
    it did work was when President Clinton's administration
    proposed a rule and Congress acted and presented a bill to
    President Bush about that regulation. And so you saw the
    political baton being handed from one party to the other and
    willingness for Congress and the President to act.
        The REINS Act strikes me as an excellent way of really
    strengthening that effort. It is not applied to all
    regulations. It is carefully tailored to major regulations that
    have a significant and major impact on the economy. It, in many
    ways, addresses some of the constitutional questions that come
    up from time to time in the various regulatory programs;
    specifically, whether Congress has delegated too much authority
    to the regulatory agency and needs to retain some of that
    authority in the legislative branch in order to perform its
    article I duties.
        And also, as I point out in the testimony, there are some
    enhancements for Presidential authority under article II that
    Mr. Conyers mentioned, article II, section 1, where you have a
    unified Executive, because the bill applies to both regular
    agencies in the executive branch but also the so-called
    independent agencies, which the President would have some
    greater authority over as a result of the REINS Act.
        It is also carefully tailored to fit into what this
    Committee is an expert at, and that is thinking about the
    processes that should be used for Federal regulations. It
    merely says Congress is going to withhold part of its
    delegation and gives itself an option to approve the final
    result before that has the force of law. It is an addition to
    the Administrative Procedures Act and carefully written to be
    narrowly tailored to fit into that procedural change. The
    parties still have their rights under the Administrative
    Procedures Act for other problems that may come up.
        So I commend the Committee for taking this up. I urge
    Congress to favorably consider the REINS Act and will be glad
    to answer any questions when you need me to.
        [The prepared statement of Mr. McIntosh follows:]

                                   __________
        Mr. Coble. Mr. Adler.

     TESTIMONY OF JONATHAN ADLER, PROFESSOR, CASE WESTERN RESERVE
    UNIVERSITY SCHOOL OF LAW, DIRECTOR, CENTER FOR BUSINESS LAW AND
                               REGULATION

        Mr. Adler. I thank you, Mr. Chairman and Members of the
    Subcommittee, for the invitation to testify today. I appreciate
    the opportunity to appear before this Subcommittee to discuss
    measures Congress may take to enhance regulatory
    accountability.
        This is a tremendously important issue. Federal regulation
    has been accumulating at a rapid pace for decades. In 2009
    alone, Federal agencies finalized over 3,500 new Federal
    regulations.
        The growth of Federal regulation has imposed significant
    costs on American consumers and businesses. According to
    estimates, as has been mentioned several times already, the
    total cost of Federal regulation exceeds $1 trillion and
    approaches $2 trillion per year. This is substantially more
    than Americans pay each year in individual income tax.
        Insofar as regulations impose a substantial cost, they
    operate like a hidden tax. Just like taxes, regulations may be
    necessary. They may be important to address public ills or
    provide public benefits, and these benefits may be important,
    and it may be worthwhile to have many of these regulations. But
    that doesn't mean that they are free.
        The fact that regulations, like taxes, can both impose
    substantial costs and generate substantial benefits makes it
    that much more important that there be political accountability
    for Federal regulatory decisions.
        The increase in the scope of Federal regulation has been
    facilitated by the legislative practice of delegating
    substantial amounts of regulatory authority and policy
    discretion to administrative agencies. All administrative
    agency authority to issue regulations comes from Congress. Such
    delegation may be expedient or even necessary at times, but it
    also has costs. Excessive delegation can undermine political
    accountability for regulatory decisions and allow regulatory
    agencies to adopt policies that do not align with congressional
    intent or public concern.
        All too often, Federal regulatory agencies use their
    statutory authority to pursue policies that are unpopular or
    unwarranted, and all too often, Congress is unable or unwilling
    to do something about it.
        This problem is magnified by the fact that agencies are
    often exercising authority granted years, if not decades, ago.
    Take one example that has certainly been discussed already
    today: The EPA is currently implementing regulations to control
    greenhouse gases under the Clean Air Act, even though Congress
    has never explicitly voted to support such regulation. Rather,
    the EPA is utilizing authority enacted decades ago. The Clean
    Air Act's basic architecture was enacted in 1970, and the Act
    has been not significantly modified since 1990. If greenhouse
    gas regulation is warranted, this is a decision that should be
    made by Congress, not an executive agency acting alone.
        The REINS Act offers a promising mechanism for disciplining
    Federal regulatory agencies and enhancing congressional
    accountability for Federal regulatory decisions. Requiring
    congressional approval before economically significant rules
    may take effect ensures that Congress takes responsibility for
    that handful of regulations, usually only several dozen per
    year, that impose major costs and hopefully also provide major
    economic benefits.
        Adopting an expedited legislative process much like that
    which is used for Fast Track Trade Authority, ensures
    transparency and prevents a congressional review process from
    unduly delaying needed regulatory initiative. Such an approach
    can enhance political accountability without sacrificing the
    benefits of agency expertise and specialization. Requiring
    regulation to be approved by a joint resolution that will be
    presented to the President also satisfies the constitutional
    requirements of bicameralism and presentment.
        The central provisions of the REINS Act is similar to a
    proposal made by then Judge Stephen Breyer in a 1984 lecture.
    He noted that a congressional authorization requirement is a
    constitutional way to replicate the function of a one-House
    legislative veto. Requiring congressional approval for the
    adoption of new regulatory initiatives, as Breyer noted,
    imposes on Congress a degree of visible responsibility.
        The REINS Act provides a means of curbing excessive or
    unwarranted regulation, but it is not an obstacle to needed
    regulatory measures supported by the public. If the agencies
    are generally discharging their obligations in a sensible
    manner, the REINS Act will have little effect. If the public
    supports specific regulatory initiatives, the Act will not
    stand in the way. Indeed, it would enhance the legitimacy of
    those regulations Congress approves by making it clear that
    such initiatives command the support of both the Legislative
    and the executive branches. Above all else, the REINS Act
    provides a means of enhancing political accountability for
    regulatory decisions.
        Thank you again for the invitation to testify. And I am
    certainly open to any questions you may have.
        [The prepared statement of Mr. Adler follows:]

                                   __________

        Mr. Coble. And you beat the red light being illuminated,
    Professor. I commend you for that.
        Professor Katzen, you are recognized for 5 minutes.

        TESTIMONY OF SALLY KATZEN, VISITING PROFESSOR, NEW YORK
        UNIVERSITY SCHOOL OF LAW, SENIOR ADVISOR, PODESTA GROUP

        Ms. Katzen. Thank you Chairman Coble, Ranking Member Cohen,
    Members of the Subcommittee, I appreciate the opportunity to
    testify today.
        As is clear from my written statement, I am not a fan of
    H.R. 10.
        It is presented as necessary and desirable to combat an
    out-of-control regulatory process, but the bill, in my view, is
    not tailored to the problem that it is intending to solve. It
    is not well-founded, and it will have serious adverse
    unintended consequences, including fundamentally changing our
    constitutional structure of government.
        Now, we have had heard a lot this afternoon about the costs
    of regulation. Everyone is citing $1.75 trillion, which is the
    high end of an extremely controversial estimate. Very few have
    talked about the benefits in monetized form.
        As someone who does cost-benefit analysis, and I was a
    former administrator of OIRA during the Clinton administration,
    you look at both sides of the equation. And OMB, during both
    the Obama administration and the Bush administration, filed
    reports to Congress in which it quantified and monetized the
    costs and the benefits, and consistently over time, the
    monetized benefits exceeded the costs by a substantial amount,
    consistently producing net benefits for our economy and our
    society. We cut back the rules, we lose the benefits.
        Second, not all rules, not even all major rules, are alike.
    H.R. 10, in its infinite wisdom, exempts the migratory bird
    quota rule, because without that rule, which is a major rule,
    you can't shoot the birds as they fly to and from Canada. But
    there are lots of other rules that industry, the regulated
    entities, want and need, rules that provide guidance, rules
    that provide predictability or certainty for their operation. I
    give in my written statement a number of these.
        There are rules that give life to programs, programs like
    agricultural subsidies, small business loan guarantees, or
    medical reimbursement. Without the eligibility and
    accountability provisions, which come in the form of rules,
    major rules, you don't have a program, even though Congress has
    authorized it or modified it. No rules, no program.s
        Other major rules may be good because they reduce burdens.
    The OSHA rule, the infamous OSHA that everybody scorns, passed
    a rule on cranes and derricks which reduced burdens. It
    minimized the costs. Industry had asked OSHA for a negotiated
    rulemaking and supported the clarification. Yet all of these
    rules would be caught by the H.R. 10 net.
        Now, the supporters say, as Mr. Adler did, well, there
    won't be any effect. They will all go through. With respect,
    our experience during the 111th Congress at least with the
    Senate suggests that it is not easy. The drafters of H.R. 10
    changed H.R. 3765, its predecessor, from allowing 10 hours of
    debate on the debatable issues to 2 hours of debate. But you
    still have a quorum call. You still have the vote, and you have
    nondebatable motions, which easily could exceed 4 to 5 hours.
        For the 65 to 95 major rules each year, the Senate is not
    going to find that time. It has been unable, with due respect,
    to find blocks of time to process nominations of Administration
    officials or even judges. And so the result is that good rules,
    meritorious rules, important rules, will not take effect even
    though months, in fact years, have been spent with enormous
    resources devoted to sorting out the science and technical
    difficulties, with public participation, with analyses of all
    sorts of issues, with numerous checks throughout the agency,
    with numerous checks throughout the Administration, and subject
    to judicial review.
        What happens if the Senate doesn't get to them? Is all the
    time and effort and resources to go for naught? The same rule
    cannot be modified once it is final agency action without
    starting a rulemaking process over again. To say there is no
    effect is not to understand the administrative process.
        At a minimum, H.R. 10 introduces additional delay and
    uncertainty to an already lengthy and complicated process.
        And, finally, for the reasons I set forth in my paper, I
    believe there are serious constitutional issues that are raised
    that fundamentally challenge the separation of powers,
    principles our Founding Fathers incorporated in the
    Constitution.
        I sketch out some of the arguments. I hear people referring
    to Justice Breyer's speech. Since 1983 in his response to
    Chadha, there has been a lot of law in the Supreme Court. And
    the Morrison v. Olson test is really critical.
        I know that I have only 5 minutes. My light is red. I thank
    you, Mr. Chairman, but I do hope somebody will pursue this
    during the questions so we can look at some of the existing law
    and practice in this field. Thank you very much.
        [The prepared statement of Ms. Katzen follows:]

                                   __________
        Mr. Coble. I thank the witnesses for their testimony.
        We will now have Members questioning the witnesses, and we
    will apply the 5-minute rule to ourselves as well.
        I recognize myself for 5 minutes.
        Mr. McIntosh, in your view, what current regulatory efforts
    most highlight the need for reforms like those in the REINS Act
    and why?
        Mr. McIntosh. One, Mr. Adler mentioned the regulation of
    carbon dioxide. And my memory there was Mr. Dingell and I tried
    to present to the previous EPAs the full legislative history of
    the Clean Air Act amendment that made it very clear carbon was
    not to be regulated. And there was a lot of back and forth, and
    ultimately, the courts have forced their hand. But, to me, that
    shows an example of where, if Congress had a procedure in
    place, they could reassert that intent, even when the courts
    are driving the agencyin a direction that perhaps the agency
    itself wasn't initially intending to go down.
        A second one would be the net neutrality regulations that
    the FCC has proposed. I think there will be a lot of litigation
    about the agency exceeding its statutory authority. I think if
    Congress had a procedure in place where they could easily pass
    that bill, and I think you could get bipartisan support for a
    bill nullifying that regulation under the REINS Act procedure,
    I think that would save a lot of time and expense and
    uncertainty in the private sector as that litigation ultimately
    goes forward. And I think, and in talking to my partners who
    specialize in the FCC Act, that that very likely could be
    thrown out, that it once again would be a great example of how
    Congress could effectively ensure there is economic progress
    that is made by paying attention to and having a part to play
    in that regulation.
        Mr. Coble. I thank you, sir.
        Professor Adler, in improving upon the Congressional Review
    Act, is not requiring Congress to approve at least some agency
    rules the next logical step? And in taking that step, what are
    the keys to ensuring that the REINS Act or any similar reform
    remains constitutional under the rule of INS v. Chadha?
        Mr. Adler. I do think it is the next logical step. I think
    a mechanism that forces Congress to actually say yea or nay to
    substantial regulatory proposal is the next logical step to
    ensure that there is political accountability for major
    regulatory decisions.
        In terms of the constitutional questions, I think INS v.
    Chadha is very clear that all that is required is bicameral
    presentment. The Supreme Court has said explicitly time and
    again that it is axiomatic, that is their word, that all
    authority for a Federal agency to adopt legislative type
    regulation comes from Congress, and that agencies have no such
    authority absent congressional enactment. So, unlike a case
    like Morrison v. Olson, where you are dealing with enforcement
    authority or arguably, at least in some context, there is some
    residual of inherent executive authority or some inherent
    authority that executive agencies may have, there is no
    inherent authority in any Federal agency to issue regulatory
    type rules absent a congressional delegation.
        And if Congress wants to delegate less, if Congress wants
    to put conditions on the exercise of that delegated authority,
    it surely can. And not only did then Judge Breyer note that in
    his 1984 lecture or Larry Tribe, the noted constitutional law
    professor at Harvard who was, until very recently, an official
    in the Obama Justice Department, who likewise said that a
    requirement of this sort would be purely constitutional.
        The last point I will just make very quickly, Mr. Chairman,
    is that we have seen this already in areas that are far more
    sensitive in regulation, in the trade context, using this sort
    of process for Fast Track Trade Authority is arguably a far
    more--a far greater intrusion on executive authority than
    anything regarding domestic regulation because trade implicates
    the Foreign Affairs Authority. And I don't think many people
    argue that Fast Track Trade Authority----
        Mr. Coble. I want to kind of beat the red light with
    Professor Katzen, if I may.
        Pardon me for cutting you off, Mr. Adler.
        Professor Katzen, you indicate that executive orders
    already constrain agency discretion to promulgate too many
    rules. But those orders haven't prevented a flood of
    regulation, and they can be withdrawn by the President, can
    they not?
        Ms. Katzen. Mr. Chairman, an executive order can be
    withdrawn by the President or his successor. But 12866 has been
    in existence since 1993, September 1993. And while there may be
    a flood, in your terms, of rules that have been issued, as I
    said, OMB has documented, during the Bush administration as
    well, that the benefits exceed the costs consistently over
    time.
        And I would just mention that Mr. Smith mentioned last week
    President Obama reaffirmed the Executive Order in his own
    Executive Order. And in fact, the very first sentence says
    that, in order to promote the public health, safety, and the
    environment while protecting economic growth, innovation, and
    job creation--it was the first sentence of his Executive Order.
    So I think the record should be clear.
        Mr. Coble. My time has expired.
        I recognize the distinguished gentleman from Tennessee, Mr.
    Cohen.
        Mr. Cohen. Thank you, Mr. Chairman. I appreciate it.
        Let me ask one question. I may not understand this fully.
    As I understand it, Mr. Davis introduced this in the 111th and
    the 112th Congress. Was it introduced, either to your knowledge
    or to anybody's knowledge, before that?
        Ms. Katzen. Last year as H.R. 30765.
        Mr. Cohen. In the 111th. But before the 111th, was it
    introduced?
        Was it, Mr. Adler?
        Mr. Adler. I don't know if it is the exact same language,
    but similar types proposals have been proposed at various
    times.
        Mr. Cohen. That required a positive approval by the
    Congress?
        Mr. Adler. Yes.
        Mr. Cohen. When?
        Mr. Adler. In the 1984 article that----
        Mr. Cohen. Forget 1984. Let's come back to recent history.
        Mr. Adler. I don't know, prior to last Congress, when the
    last time such a proposal had been introduced. But I know then
    Congressman Nick Smith from Michigan had an article about
    legislation.
        Mr. Cohen. When was that?
        Mr. Adler. I want to say 1996, maybe 1997. I am not exactly
    sure.
        Mr. Cohen. And how about you, Mr. McIntosh? Do you know of
    anything?
        Mr. McIntosh. I am not aware of----
        Mr. Cohen. So, basically, during the Bush years, it was all
    like wonderful, and nobody even thought about this, and the
    executive authority was great, and we didn't need this. It is
    only since Mr. Obama was elected President that we need to do
    this. That seems to be the situation. For 8 years, it was
    wonderful with Mr. Bush, and the executive did everything
    great.
        Let me ask you this question. You said--I think it was Mr.
    Adler--you said this isn't going to present a problem, that
    Congress can do it. Do you understand in the Senate that they
    have held up like 50 or 60 judges? And you know--what is it
    called? A blue slip? Do you know what a blue slip is? Can you
    imagine the Senators? I mean, that is the last ``don't ask,
    don't tell.'' You don't ask what you are going to get for it,
    and you don't tell what you get for your blue slip. They still
    have that in the Senate. How is that going to work? All these
    regulations, they do a blue slip. I need a park in my district.
    Done. Don't you think that is going to invite basically what I
    would think some nefarious type--one Senator can hold it up.
        Mr. Adler, is that right? One Senator under the rules we
    know today can hold up appointments, can hold up rules and
    regulations?
        Mr. Adler. Yes. Under the way the rules are typically
    applied, they can. But blue slips are a courtesy afforded to
    home State Senators for nominations. They are not applied to
    legislation. And my read of the bill would not allow holds of
    joint resolutions----
        Mr. Cohen. Mr. Adler, are you suggesting that we can write
    a bill over here that is going to restrict or change the Senate
    rules?
        Mr. Adler. I think that if the House and the Senate both
    passed a bill that is signed into law by the President that
    codifies changes to the rules for both Chambers, as has been
    done for the Base Closure Commission, for the Fast Track Trade
    Authority, for----
        Mr. Cohen. You understand that one Senator can hold up a
    bill?
        Mr. Adler. If the rules allow for it, yes. But I also know
    that there are probably about a dozen examples of the House and
    Senate passing legislation limiting the rules to prevent those
    sorts of holds by limiting debate and by requiring votes to
    occur on a scheduled basis. And the two most prominent examples
    are with the Base Closures Commission and with the Fast Track
    Trade Authority.
        Mr. Cohen. Thank you, sir.
        Ms. Katzen, let me ask you a question. You were here when
    we read the Constitution. Did you watch us read the
    Constitution from the floor of the well?
        Ms. Katzen. Actually, I did.
        Mr. Cohen. You did.
        And did you hear--I don't know who read it; I am sure it
    was somebody--the article II, section 1, something about all
    power being vested in the executive to carry out the laws. Tell
    us a little primer of what that means about the executive. And
    can they have the ability to execute our laws without rules?
    Could they do it without having any rules?
        Ms. Katzen. I think that is a serious problem, because
    section 1 of article II vests all executive power in the
    President. That power includes the power to take care that the
    laws be faithfully executed. That is a quote from the
    Constitution. That means that when Congress passes the law, it
    is up to the President and the subsequent President and the
    subsequent President after that, whether they agreed with that
    law or not, to carry out the law.
        Now, for over a century, administrative agencies have been
    implementing or carrying out the law by issuing regulations.
    That is how it is done. And so for that reason, I believe that
    an attempt by Congress to strip the President of that authority
    with respect to major rules is tantamount to an act of
    Congress--I am using Chief Justice Rehnquist's words from
    Morrison v. Olson--of one branch self-aggrandizing at the
    expense of another branch. Or, again using Chief Justice
    Rehnquist's words, an act of Congress which would impermissibly
    interfere with the President's exercise of his constitutionally
    appointed functions. These are serious questions.
        I wouldn't be so presumptuous as to say that I know how the
    Supreme Court would rule, but if they want to invoke Justice
    Breyer, I would refer them respectfully to Justice Scalia as
    well, who has been, among all the Justices, the guardian of the
    President's powers.
        Mr. Cohen. Thank you.
        Mr. Chairman, I yield back the remainder of my time beyond
    the red light.
        Mr. Coble. You didn't violate it too badly.
        The Chair recognizes the gentleman from South Carolina, Mr.
    Gowdy.
        Mr. Gowdy. Thank you, Mr. Chairman.
        Mr. Chairman, I would like to make my opening statement be
    part of the record, with your consent.
        I want to thank all three of our panelists.
        Mr. McIntosh, I will start with you.
        Mr. Coble. Without objection.
        [The prepared statement of Mr. Gowdy follows:]
      Prepared Statement of the Honorable Trey Gowdy, a Representative in
    Congress from the State of South Carolina, and Member, Subcommittee on
                   Courts, Commercial and Administrative Law

                                   __________

        Mr. Gowdy. Thank you, Mr. Chairman.
        What, in your judgment, is the proper balance between the
    executive branch and the legislative branch when it comes to
    rulemaking and enforcement?
        Mr. McIntosh. Let me point out that the Administrative
    Procedure Act also constrains how the executive branch writes
    its regulations, the processes it must use before they can have
    the force of law. So there is a long tradition in our modern
    history of Congress asserting constraints over how the
    President and the executive branch can issue regulations. It is
    fully compatible with that for Congress to say, Before this
    regulation that you are proposing, Mr. President, or the
    agency, it has to come back to Congress and sit there for
    Congress to give its approval of the content of that
    regulation.
        I think it is fully within Congress's power to do that. I
    would point out that for the century prior to the last century,
    there were no regulatory authorities or bodies, and the
    President was fully capable of exercising his duty under the
    Constitution to take care that the laws were faithfully
    executed.
        So I think this act, perhaps it would be hubris to say that
    it goes as far as to restrain the President's executive
    authority because it simply doesn't do that. There are ways you
    can argue that, in fact, it enhances it, as I mentioned
    earlier, vis-a-vis the so-called independent agencies, because
    his signature on the bill approving the regulation gives him
    control over those agencies and the policies that they develop.
        Mr. Gowdy. Mr. Adler, I may have heard you incorrectly. And
    if I did, I want to give you a chance to correct. I wrote down
    that you said there have been 3,500 regulations promulgated in
    the past?
        Mr. Adler. In 2009, I think the exact number is 3,503. And,
    of those, I don't remember the exact number, but several dozen
    of those were major. But the 3,500 number was all regulations
    in, I believe, 2009.
        Mr. Gowdy. All right. I am just a prosecutor, so forgive me
    for not knowing much about civil law. But would the violation
    of a Federal regulation be evidence of negligence in a civil
    suit?
        Mr. Adler. It depends.
        Mr. Gowdy. It depends on what?
        Mr. Adler. I mean, it depends on the nature of the
    regulation; it depends on what is at issue. But, I mean, there
    are instances in which that could be evidence of that. It would
    depend. I guess it would really depend on a lot of factors,
    including what the State laws are.
        Mr. Gowdy. Are there any criminal penalties connected with
    violations of Federal regulations?
        Mr. Adler. There often are criminal penalties associated
    with violating----
        Mr. Gowdy. How can Congress abdicate its responsibility for
    criminal enforcement to a nonelected entity?
        Mr. Adler. Well, I think you have hit on the key issue
    here, is that Congress, for expedience, has delegated lots of
    authority to administrative agencies to develop rules of
    conduct in a wide range of detailed and complex areas. And I
    think what we have overlooked is that it is ultimately Congress
    that is responsible for that authority.
        And especially when you have rules that are going to carry
    criminal sanctions or, as in the case of the REINS Act, rules
    that are estimated to have a substantial effect on the economy,
    which is a rough proxy for a really major policy decision that
    will affect a large part of the country, I think it is
    certainly reasonable to say that we should make sure the people
    who are the source of the legislative power in the first place,
    Congress, where all legislative power is vested under article 1
    of the Constitution, is accountable for that decision and that
    members of the public know whether or not their representatives
    believe that imposing that sort of rule is or is not a good
    idea.
        Mr. Gowdy. Ms. Katzen, you do not challenge the
    constitutionality of congressional oversight, correct?
        Ms. Katzen. Not at all.
        Mr. Gowdy. You don't even challenge the wisdom of
    congressional oversight.
        Ms. Katzen. I endorse it wholeheartedly.
        Mr. Gowdy. So when you mentioned that there are
    constitutional infirmities in this bill, which, as I read it,
    is Congress reclaiming its responsibility/authority for
    oversight, what do you mean by ``constitutional infirmities?''
        Ms. Katzen. I think the REINS Act goes well beyond
    oversight. And the Chairman talked about, in his opening
    statement, fine-tuning the regulatory system. I think the REINS
    Act is a blunt instrument that goes well beyond oversight. What
    it says is that Congress must affirmatively approve an action
    that it has already delegated and on which a lot of work,
    effort, and resources have been spent in refining and
    developing and issuing a rule.
        Mr. Gowdy. But you would agree with me, Congress could
    reclaim that delegation in the first place, right?
        Ms. Katzen. Absolutely. And that is through--the
    Congressional Review Act does exactly that, because it
    satisfies the bicameral and presentment part of Chadha, and it
    says Congress is saying: You can't do that. That is very
    different from saying: Before you do anything in this area, you
    must come back, even though we have already delegated it to
    you, you must come back and get our permission.
        Mr. Gowdy. What is the constitutional distinction between
    doing the two?
        Mr. Coble. The gentleman's time is expired.
        Ms. Katzen. I think there is a significant----
        Mr. Gowdy. I apologize, Mr. Chairman.
        Mr. Coble. You may answer that quickly, Ms. Katzen.
        Ms. Katzen. I think there is a significant difference
    between the two. And that is why the Congressional Review Act
    was originally crafted as it was, to be a change of the law,
    not a filter before which implementing a pre-existing law can
    go forward.
        Mr. Gowdy. Thank you, Mr. Chairman.
        Mr. Coble. Thank you, Mr. Gowdy.
        Mr. Conyers?
        Mr. Conyers. Thank you, Chairman Coble.
        My ex-prosecutor colleague asked why the Congress doesn't
    enforce the laws. Well, as McIntosh and Davis and I know, we
    pass the laws, we oversight the laws, we do not enforce the
    laws. There is a little Federal agency called the Department of
    Justice that enforces the laws. So that is my criminal justice
    lesson for the day.
        Now, this $1.75 trillion annually that has been raised
    here, I would like to ask Ms. Katzen, how does that comport
    with the issues of the Congressional Budget Office, which has a
    different set of figures here? OMB said that major regulations
    promulgated over the 10-year period between 1998 and 2008 are
    estimated to have cost between $51 billion and $60 billion.
        Ms. Katzen. I would love to answer the question, but I know
    the red light will go off before I even get halfway there.
        The 1.75 comes from a study that was presented in the mid-
    1990's that immediately raised all sorts of flags, both as to
    the assumptions, the methodology, et cetera. CRS did a very
    careful analysis, which I would commend to you, that shows the
    different problems that exist.
        Now, Congress ordered OMB to do the same thing, to do a
    real study. And what OMB did was to come up with the numbers
    that you had. They are very large numbers, but they are much
    smaller than the 1.75 trillion numbers.
        Congress, in its wisdom, said, determine the costs and
    determine the benefits. So, as you talk about the $43 billion
    to $55 billion in costs, they found $128 billion to $616
    billion in benefits. So even if you use the highest end of the
    costs and the lowest end of the benefits, you still have net
    benefits of $73 billion.
        Mr. Conyers. All right. Let me ask you this. Who was it
    that made this authoritative statement, allegedly, about over a
    trillion dollars? Do you know?
        Ms. Katzen. It originally came from a Tom Hopkins study and
    then a gentleman whose name I----
        Mr. Conyers. Mr. Adler, do you know?
        Mr. Adler. I don't know off the top of my head.
        But I would just note that the OMB numbers that have been
    referenced exclude independent agencies and exclude non-major
    rules, which are over 90 percent of the regulations that are
    finalized each year. So to compare the OMB numbers with the
    other estimates is not----
        Mr. Conyers. Mr. McIntosh, do you know?
        Mr. McIntosh. Unconstitutional is the subject that Ms.
    Katzen has referred to----
        Mr. Conyers. But who----
        Mr. McIntosh. And lots of people in the literature have
    cited that as they have discussed the cost of Federal
    regulation.
        Mr. Conyers. So everybody says that somebody said it once
    and it is in a study somewhere, and so that is about it, huh?
        Ms. Katzen, did you want to add anything to this?
        Ms. Katzen. Someone just handed me something which uses the
    name Mark Crain and Thomas Hopkins, and I think they are the
    co-authors of this $1.75 trillion--whatever.
        Mr. Conyers. All right. Let me ask this question. If this
    REINS Act, which is high up on the list of our new leadership's
    agenda--it is the fourth piece of legislation introduced--what
    would this do to health-care reform? How would you take an
    enormous piece of legislation like this--and I think
    ``ObamaCare'' is going to be a congratulatory remark in
    history--how would this affect it? Wouldn't it just stop it in
    its tracks?
        Mr. Adler. It depends on what Members of Congress feel
    about it. If the majority of those in both houses of Congress
    support the regulations that are necessary to implement that
    law, then it would go on as before.
        The only thing that would stop it, under the REINS Act,
    would be is if the majorities of Congress don't support those
    regulations. It ensures, essentially, that the American people
    get the sort of regulatory policy that the American people
    want. And I would think that that is a step toward greater
    political accountability and----
        Mr. Conyers. Now, well, wait a minute. The majority of the
    Congress already passed the bill, and the President signed it
    into law.
        Mr. Adler. But congressional opinions change. Congress
    repeals statutes, revokes statutes, alters statutes.
        Mr. Conyers. Well, that is----
        Mr. Adler. And one of the problems is you don't really have
    legislation that was enacted last year----
        Mr. Conyers. Can I ask unanimous consent for 1 additional
    minute?
        Mr. Coble. Certainly.
        Mr. Conyers. Thank you, sir.
        Now, look, gentlemen and lady, you all know that any one of
    us, to challenge a regulation, all they have to do is walk into
    the nearest Federal district court and sue away. And we have
    regulations that get reviewed and modified or kicked out. What
    is wrong with that?
        Mr. Adler. Nothing. But courts don't want to review the
    policy merits of regulation. Courts don't ask, is this
    regulation a good idea? Are the costs worth the benefits? Is
    this something the American people support?
        What courts look at is the nonpolicy questions: Were the
    rules followed? Was there--and those are two separate
    questions. This body is responsible for the policy questions.
        Mr. Conyers. But, look, we just passed health care months
    ago. You mean we got to go back and look at it again?
        Mr. Adler. I think that when you have major legislation and
    agencies are implementing that legislation, it is a good idea
    for Congress to----
        Mr. Conyers. Do you know what this sounds like to me now?
    It sounds like a backdoor way of legislating again, when they
    are charged with actually just making the rules to implement a
    bill already signed into law.
        Mr. Coble. Mr. Conyers, your minute is over.
        Mr. Conyers. Thank you very much, Mr. Chairman, for your
    generosity.
        Mr. Coble. Mr. Reed? Mr. Reed is up next for 5 minutes.
        Mr. Reed. Oh, thank you, Chairman.
        I would like to follow up on the comment that was just made
    by Mr. Conyers, when he said the individual, whoever is
    objecting to the rule, can sue away. Who pays for that? Who is
    the person who has to bring that lawsuit? Usually, it is the
    small-business owner. Is it a farmer, is it a gentleman who is
    objecting to that regulation?
        I will ask Mr. McIntosh that question.
        Mr. McIntosh. Yes, sir, you are exactly right. It is the
    private party that has been affected by the regulation.
        And their recourse is, in fact, very limited, in they have
    to argue that the agency failed to follow its own procedures or
    acted arbitrarily and capriciously, not that they disagree with
    or they feel it is unfair that the regulation imposes burdens,
    say, on wheat farmers but not on corn farmers.
        And the law says to the agency, the Department of
    Agriculture, you go and allocate what should be planted on the
    land and, you know, do it in a way that maximizes the return
    for agriculture. Well, if the farmer who is adversely affected
    by that wants his day in court, all he can say is, ``Well,
    sure, they allocated it, but they didn't give me my
    allocation.'' The courts say, ``Sorry, you lose. They had to
    make that decision.''
        And I think Mr. Conyers's later remark reflects correctly
    that what the REINS Act would do is say that decision, who gets
    which allocation for what crops to do, should actually be a
    legislative decision. And so, in many ways, what the bill does
    is correct a constitutional deficiency that is inherent in the
    regulatory program, where the accountability for legislative
    decisions like those never comes back to Congress.
        Mr. Reed. Then correct me if I am wrong, Mr. McIntosh. That
    bureaucrat who is creating that rule, he is not an elected
    official, correct?
        Mr. McIntosh. No. He would be typically a civil servant or
    assigned by a person appointed by the President.
        Mr. Reed. So when I go talk to my small-business
    constituent or my farmer in my district and he objects to the
    policy, I can't go to him, ``Well, we will vote that guy out
    the next time around because we disagree with that policy.'' He
    is essentially stuck with that rule, other than the courts that
    are available to him. Is that a fair assessment?
        Mr. McIntosh. His political recourse would be to join
    others to vote enough Members of Congress to change the law or
    to vote a new President who would change the regulation, direct
    his agency.
        Mr. Reed. Okay. I appreciate that.
        There has been a lot of objection that I am hearing in this
    testimony that one of the problems is the workload that would
    be put on Congress, finding the time to go through and develop
    that.
        Wouldn't we face that same problem if we went through the
    enabling legislation and amended the enabling legislation?
    Wouldn't that be a tremendous workload on Congress, to go back?
        No one objects to the fact that Congress would have that
    authority to do it, do you? We could go back through each of
    the pieces of legislation, change the enabling authority and
    clarify our intent as to what we meant from Congress. No one
    objects to that, correct?
        Mr. McIntosh. No.
        Mr. Adler. Right.
        Mr. Reed. So that burden on Congress would be bigger, I
    would argue. Am I farfetched on that conclusion, that that
    would be a huge burden on Congress?
        Mr. McIntosh. Yes, it would. I mean, back in 1995, we
    thought about doing that to address a lot of the regulatory
    problems, and some of them got dealt with and others didn't.
        Let me take, though, 2 seconds to----
        Mr. Reed. Please.
        Mr. McIntosh [continuing]. Brag about you all. I actually
    think Congress can handle that burden. Now, the Senate
    continues to mystify me, but the people who are----
        Mr. Reed. You are not alone.
        Mr. McIntosh [continuing]. In that body say they get things
    done by unanimous consent, ultimately. But I think it can be
    done.
        Mr. Reed. Thank you.
        I yield the balance of my time.
        Mr. Coble. I thank the gentleman.
        The gentleman from Georgia, Mr. Johnson, is recognized.
        Mr. Johnson. Thank you, Mr. Chairman.
        Mr. Adler, isn't it correct that regulations that pertain
    to clean air, these are the regulations that you are speaking
    of being able to stop?
        Mr. Adler. Well, any regulations that----
        Mr. Johnson. Yeah. Air quality, water quality?
        Mr. Adler. The examples I gave there weren't----
        Mr. Johnson. Well, no, no, no, no. I just want you to
    answer my questions. Now, water quality, air quality, correct?
        Mr. Adler. Yes. Congress should be held accountable for
    those.
        Mr. Johnson. What about food safety?
        Mr. Adler. I think Members of Congress should be willing to
    vote to be held accountable.
        Mr. Johnson. What about drug safety?
        Mr. Adler. I think Members of Congress should be held
    accountable by voting on whether or not those regulations are a
    good idea.
        Mr. Johnson. What about financial reform?
        Mr. Adler. Again, Congressman, I don't think Members of
    Congress----
        Mr. Johnson. I mean, that is covered under--these are
    regulations that are brought to bear on big business and
    industry----
        Mr. Adler. Yes.
        Mr. Johnson [continuing]. Primarily.
        Mr. Adler. Primarily. And I think----
        Mr. Johnson. All right. And so----
        Mr. Adler.--Members of Congress should be held more
    accountable----
        Mr. Johnson. So things like the health and safety of
    workers, do you want to be able to stop those kinds of
    regulations from becoming the force of law?
        Mr. Adler. No. I want my Member of Congress to have to vote
    on that decision. I want to know if my Member of Congress
    supports it.
        Mr. Johnson. Well, tell me now. You contend that, what, $1
    trillion per year is what all of these regulations cost? How
    many new regulations are promulgated yearly that have that
    economic significance?
        Mr. Adler. That is the aggregate effect. Between 2000 and
    2009, the number of major rules that would be affected by the
    REINS Act has been between 50 and 80 per year.
        Mr. Johnson. Okay. And you are familiar with the attributes
    of the Senate----
        Mr. Adler. Yes.
        Mr. Johnson [continuing]. In terms of them doing their
    work.
        Mr. Adler. Yes. And that is why the REINS Act----
        Mr. Johnson. And you are aware of the fact that one of
    those attributes is not the ability to move quickly, is that
    correct?
        Mr. Adler. I think that the REINS Act addresses that.
        Mr. Johnson. You heard that before, and you know that to be
    a fact. Isn't that correct?
        Mr. Adler. It is correct.
        Mr. Johnson. That the Senate does not move quickly?
        Mr. Adler. The Senate has to be forced to move quickly, and
    I think the REINS Act accomplishes that.
        Mr. Johnson. And so an obscure regulation, you think, would
    be enough to cause them to set aside all of their judicial
    appointments and other important--treaties that need to be
    ratified, all of the legislation that Mr. McIntosh gives us
    credit for for producing here in the House, but, because of an
    obscure regulation, they would suddenly spring into action. Is
    that what you want us to believe?
        Mr. Adler. I don't believe regulations dealing with clean
    air or clean water or financial services or some of the
    examples you gave that cost more than $100 million a year, by
    the executive branch's own estimates, is an obscure regulation.
        Mr. Johnson. Well, let's talk about obscure regulations.
    Who would decide--or, how would it be decided that a regulation
    should be subjected to the congressional review under the REINS
    Act?
        Mr. Adler. The executive branch's cost estimates would
    determine that.
        Mr. Johnson. Okay. Who would bring that to the attention of
    Congress?
        Mr. Adler. The REINS Act has a procedure where that
    information is automatically transmitted to both houses of
    Congress with the regulation once it is finalized.
        Mr. Johnson. Who would do that?
        Mr. Adler. I would have to check. I think both----
        Mr. Johnson.Would it be the U.S. Chamber of Commerce?
        Mr. Adler. The agency does it, and I believe the
    comptroller general that heads the Government Accountability
    Office is responsible for submitting that to both houses. And
    then, within 3 days, legislation is automatically introduced,
    or the joint resolution is automatically introduced in both
    houses. The last draft that I recall reading in legislation----
        Mr. Johnson. So there is some ability for politics to
    infect the process of actually producing the legislation then.
        Mr. Adler. Actually, no. The way the REINS Act is drafted,
    there is no amendment----
        Mr. Johnson. Well, it would be a government bureaucrat that
    would do that?
        Mr. Adler. I spend a lot of time doing regulatory policy
    and----
        Mr. Johnson. How do we get----
        Mr. Adler [continuing]. Much worried about the backroom
    deals in regulatory agencies than any up-or-down votes on the
    floor of the body of the whole.
        Mr. Johnson. How will we get politics, Mr. Adler, out of
    the rule-making process?
        Mr. Adler. We----
        Mr. Johnson. And aren't we, by subjecting the rule-making
    process to congressional dictates, aren't we, by the very
    nature of what we do here in the House, subjecting these rules
    to politics----
        Mr. Adler. Well, rules----
        Mr. Johnson [continuing]. And influence, political
    influence, with campaign contributions and whatnot?
        Mr. Adler. Rules that govern private behavior are things
    that political officials should be held accountable for. And I
    believe that sunlight is the best disinfectant, and requiring
    all Members of Congress to vote up or down in the body of the
    whole is far less subject to special-interest manipulation than
    leaving things in the halls of regulatory agencies. Your small-
    business man, your small homeowner isn't spending time at the
    FCC or the EPA or the USDA lobbying on regulations. I really
    deserve to know how Members of Congress feel and then vote.
        Mr. Johnson. We just want to remove all regulatory action
    here in Congress--less government. Let's cut government, let's
    cut regulation, and let's allow the members of the U.S. Chamber
    of Commerce and other large businesses that traditionally shut
    out small business----
        Mr. Coble. The gentleman's time is expired.
        Mr. Johnson [continuing]. Just to run roughshod over
    society, and whatever will be will be.
        I appreciate it. Thank you, sir.
        Mr. Coble. The Chair recognizes the gentleman from Arizona,
    Mr. Franks.
        Mr. Franks. Well, thank you, Mr. Chairman.
        And thank all of you for being here today.
        I guess, Mr. McIntosh, my first question will be to you,
    sir. It occurs to me that not only the process here but the
    mindset in which agencies write their regulations could be one
    of the most significant advantages of this legislation.
    Because, you know, if I were the director of an agency and I
    were writing regulations and I knew that it was going to be
    subjected to the scrutiny and oversight of Congress, that
    Congress is going to have to prove it, I would be pretty
    careful how I wrote that. I would make sure that it was a
    regulation that would comport with a lot of common sense and
    that could withstand the rigors of the legislative process
    itself.
        So, with that, since it only requires Congress to approve
    major rules but it could affect and change the culture of the
    agency, in what way do you think that that would improve all
    rule-making? Or do you think I am just all wet here?
        Mr. McIntosh. No, I think you are exactly right, that the
    prospect of having the work product that the agency does in
    developing a regulation be scrutinized in a debate in Congress
    and voted up or down will have, as it does on every other
    decision the agency makes where Congress has expressed an
    interest, has an impact on their thinking and their calculation
    about it. And that provides more accountability, provides more
    accountability ultimately to the citizens, who vote on Members
    of Congress.
        That same accountability, by the way, is also in the
    Congressional Review Act. It is more attenuated. But you can
    still, by having a discharge position in the House to stop a
    rule, rather than the presumption of it--with the presumption
    being that it goes forward, or 30 Members of the Senate can
    have a discharge position, the mere prospect of a debate, even
    if everyone assumes that won't pass, I think, can also have a
    salutatory effect on the agencies and their deliberations. So I
    am encouraging Members of Congress, while you are deliberating
    the REINS Act, to use your authority under the Congressional
    Review Act, as well.
        But, again, it comes down to sunshine, which Mr. Adler
    mentioned. Bringing things out into the public debate has a
    tremendous benefit on all of the actors involved.
        Mr. Franks. Well, thank you, sir.
        You know, I know there is going to be, as already manifest
    here, some debate as to the constitutionality of the
    legislation. I, for one, am fundamentally convinced that it is
    constitutional, but I want to, you know, be open to potential
    dissent here.
        Those who cite article 2, section 1 of the Constitution
    obviously are citing that Executive power should be vested in
    the President. And, of course, some of us would cite article 1,
    section 1, that the legislative power is vested in the
    Congress. And it seems to me that regulation certainly has a
    lot of the same characteristics as legislation, so if you are
    going to make that case, it is important to consider.
        But in constitutional terms, Mr. Adler, is there any
    critical substantive difference between the REINS Act and a
    statute that treats new regulations as simply proposed
    recommendations to Congress for legislative action?
        Mr. Adler. No, I don't think there is any significant
    difference, and I think both are clearly constitutional under
    existing precedent.
        Mr. Franks. I am going to give Ms. Katzen an opportunity,
    actually, here in a moment. But I wanted to find out, what is
    your--why do you postulate that this is constitutional? Is
    there anything that you would point out in particular?
        Mr. Adler. Well, a couple things. I mean, the bicameral and
    presentment requirements have to be satisfied. Both would
    satisfy that.
        I think that the Supreme Court has made clear, repeatedly,
    in numerous opinions, as have lower courts, that all authority
    to issue regulations must be expressly granted. There is no
    residual authority to issue regulations that comes with other
    grants of authority of agencies. It is not something that is
    seen as inherently Executive. It is something that, for the
    most part, the majority of Federal agencies did not enjoy until
    the 1970's. There were some exemptions.
        And the presumption had been that, unless agencies are
    expressly granted the authority to issue legislative-type
    rules, that is an authority they lack. And Congress is not
    obligated to delegate that authority. And if Congress wants to
    restrain that authority in some way, such as it does here,
    there is no constitutional problem. And it doesn't create the
    sorts of concerns that might be raised if, for example,
    Congress sought to impose similar limits on the exercise of,
    say, prosecutorial discretion or other things that are closer
    to the court----
        Mr. Franks. I understand. No, that is a good answer.
        Quickly then, Ms. Katzen, Justice Breyer and Professor
    Tribe of Harvard have both published articles supporting a view
    that the REINS Act is constitutional. And I know you know that.
    But could you specify for us why you think Mr. Adler is wrong
    or why Justice Breyer or Professor Tribe are wrong? And do you
    think there is any merit to their views whatsoever?
        Ms. Katzen. Well, thank you for that open invitation. And
    the light is red, but if I may answer?
        Mr. Coble. Briefly, if you will, Professor.
        Ms. Katzen. I will try.
        I think Justice Breyer, who was then a judge, not a
    justice, was engaging in what he often does, which is extremely
    creative, more-theoretical-than-practical analysis in this
    article, which I have read very carefully.
        And I think one of the most important things is that he
    sees it as a replacement for the one-house veto, which was
    invalidated in Chadha. And he saw it as a case by case, going
    through each of the statutes, rather than an across-the-board,
    blanket provision.
        But, most importantly, when he finishes, he makes it very
    clear that it is neither practical nor desirable. He questions
    the wisdom of it. And if you read the entire article, it is a,
    ``Well, we could do this kind of stuff, and we could think
    about these kinds of--''
        Mr. Franks. So, in other words, he thinks it is stupid but
    constitutional?
        Ms. Katzen. He thinks that it is----
        Mr. Coble. The gentleman's time has expired.
        Ms. Katzen. But this was before the last several decades of
    Supreme Court decisions--in Morrison v. Olson, Mistretta, a few
    other cases--in which the Court has been very clear that
    separation of powers has a life beyond. They are looking at it
    on a functional basis----
        Mr. Coble. The time has expired, Professor. If you will
    wrap it up.
        Mr. Franks. Thank you, Mr. Chairman.
        Mr. Coble. The time has expired.
        Ms. Katzen. Yes, sir.
        Mr. Coble. The gentleman from Illinois.
        Mr. Quigley. Thank you, Mr. Chairman.
        You know, I am still relatively new here, but I learn
    something new every day. Today I learned that it is not good
    when someone who is not elected is enforcing our laws,
    especially criminal ones. So the next time a police officer
    stops me, I am going to say, ``Who elected you?'' Or FBI agents
    or State's attorneys or--just go on down the line.
        In the end, the only person who is elected in the executive
    branch is the Executive. At the county level, I suppose that is
    the State's attorney. But in the end, there is some delegation.
    This isn't 1776. It is a far more complicated world.
        And, ladies and gentlemen, I would respectfully suggest or
    defy you to say, I am not going to think about regulation
    today. When I get on this commuter airliner, I am not going to
    wonder or worry about how many hours' sleep that pilot got last
    night. When you come to my hometown in Chicago, the morbidity
    and mortality capital of the United States for asthma, don't
    think about regulation. Or if you drink our tap water in
    Chicago, which has chromium levels--not in the lake, but in the
    drinking water--three times higher than the new--I know it is a
    bad word--regulation proposed in California. It is the Erin
    Brockovich chemical, if you will recall.
        So you can decide now or you can decide when you have your
    eggs in the morning--a million cases of salmonella last year. I
    understand, we all understand, that the President was trying to
    strike a balance here. That over-200-year friction between the
    executive branch and the legislative branch. And it gnaws on
    you when you don't like what they do, so you want to change the
    rules when it bothers you.
        So I looked at it. And I talk about the President striking
    a balance. Mr. McIntosh, Mr. Adler, how many rules do you think
    this President's EPA has proposed or finalized in his first 21
    months? Just a guess, if you want.
        Mr. Adler. Major rules or all rules?
        Mr. Quigley. All rules. EPA only, Clean Air Act.
        Mr. Adler. Just under the Clean Air Act?
        Mr. Quigley. Yeah.
        Mr. Adler. My guess would be, just under the Clean Air Act,
    probably under a dozen.
        Mr. Quigley. It is much higher. It is 87. And I was
    appalled. I couldn't believe it. And I thought, well, who could
    be more liberal than--maybe the Clinton administration. The
    first 2 years, what do you think his numbers were? A hundred
    and fifteen. It just shows a trend here. I looked further.
    George W. Bush, first 2 years, 146--146.
        So, Mr. McIntosh, you used the expression, I believe--and I
    don't want to misquote you, former Member--that the courts
    ``forced their hand'' on carbon. Does that mean you just
    disagreed with them?
        Mr. McIntosh. No. What I meant by that was the Court, I
    think, incorrectly interpreted the bill.
        Mr. Quigley. But isn't that--go back to the Constitution.
    Now you are disagreeing with two out of three branches. Didn't
    the Constitution say that the executive enforces and then the
    Supreme Court interprets, and they interpreted. So you are
    upset with both of them now.
        Mr. McIntosh. Well, at the time, the executive branch
    didn't share the Court's interpretation. And I think there was
    a fair amount of evidence in the legislative history that
    Congress didn't intend that when they passed the Clean Air Act
    amendments.
        Mr. Quigley. Well, just, if I could, sir, please, let me
    just read you the language that you had a problem with, section
    202(a)(1): ``which, in its judgment, causes''--we are talking
    about carbon here, that you don't have a problem with--``which,
    in its judgment, causes or contributes to air pollution which
    may reasonably be anticipated to endanger public health or
    welfare.''
        So we were talking generalities before, but now we are
    talking specifics. You don't think that language implies that
    there could be a problem that someone in the EPA could
    reasonably interpret to endanger the public health or safety?
        Mr. McIntosh. No. That section of the Clean Air Act was
    intended to give EPA the authority to regulate when substances
    that were, at the time that bill was passed, not known to be
    problematic for the health become known to them.
        But, at the time, people knew of carbon dioxide. And I
    would recommend you check with John Dingell, who was the author
    of it. They did not intend for that provision of the Clean Air
    Act to give authority for EPA to regulate carbon dioxide. They
    talked about it in other parts of the bill, decided not to give
    that authority.
        But let me--the language you cited I think is also a really
    important point for another issue that is very key to this
    whole debate. And that is, how specific should Congress be when
    it delegates the legislative authority to the regulatory
    agencies? And there has always been a debate back and forth
    about whether general language, like the language you cited, is
    appropriate. The consensus is that it has been in the Clean Air
    Act, in the language cited there.
        But I would point you to an article that I referred to in
    my testimony by a professor at Boston University, Gary Lawson,
    where he points out that, if you had the ``Goodness and
    Niceness Act'' and said to the regulatory agency, ``Promulgate
    rules for goodness and niceness, and figure out what the
    punishment should be,'' that that would be too broad a
    delegation.
        So somewhere in there, there is a spectrum. And the
    Constitution says, no, the legislature can't delegate all of
    its legislative authority to the agencies. The REINS Act gives
    you the benefit of protecting against that, because for major
    regulations they come back to Congress and then there is a
    vote.
        Mr. Quigley. Only if you disagree.
        Mr. Gowdy. [presiding.] Mr. McIntosh, I apologize, but the
    gentleman's time is expired.
        The Chair would recognize the gentleman from Florida, Mr.
    Ross.
        Mr. Ross. Thank you, Mr. Chairman.
        You know, it is interesting when we talk about the
    regulatory environment. And, as a businessman, one of the
    things I have learned is that, if I want to be profitable, if I
    want to make sure that I have the right environment, I try to
    manage my risks. And the risks I look at, of course, are, you
    know, there are some insurance risks, there is the market risk,
    there is my resource risk. But one of the things I have learned
    is the regulatory risk that exists is almost not manageable.
    And the reason it is not manageable is because there are no
    trends. There is no way you can anticipate what the regulatory
    environment is ever going to be if you want to start or operate
    a business.
        And, in my particular State, there is a numeric nutrient
    water criteria that the EPA is trying to impose, coincidentally
    just on Florida, that my ag industry has indicated that it will
    cost over 14,000 full- and part-time jobs, lost over $1 billion
    annually, cost my phosphate and fertilizer industry $1.6
    billion in capital costs and $59 billion in operating costs.
        It would seem to me that this act, this REINS Act, would
    allow at least some sense of risk management over the
    regulatory environment. Wouldn't you agree, Mr. Adler?
        Mr. Adler. Oh, certainly.
        Mr. Ross. And with regard to even more imposition of
    regulatory schemes, I am reminded back years ago when I was in
    the legislature--and this is on a smaller scale--but I was
    active in a Boy Scout group that had a summer camp. And they
    had had this property for 50 years. But they wanted to put an
    outhouse on there for the summer camp. But what they found out
    is that, even though they had no running water and no
    electricity, they had to go get architectural drawings,
    engineer-designed approved plans. The DEP had to do a soil
    sampling. And by the time they were able to even get anything
    in order to meet with the regulatory system, summer camp was
    over.
        And what it taught me, though, was that logic and reason
    isn't always there. Now, I know that H.R. 10 exempts camping,
    hunting, and fishing. But without logic and reason, I think you
    also lack accountability.
        And one of the things--I want to ask you this, Ms. Katzen.
    Would not the REINS Act allow for a greater sense of
    accountability to where it should belong, and that is in the
    congressional oversight of the regulatory environment?
        Ms. Katzen. As I said earlier, Mr. Ross, I strongly endorse
    the notion of congressional oversight. I have no qualms
    whatsoever with your Committees calling up the--you call them
    bureaucrats; I would call them committed, career civil servants
    and political appointees at the agencies--and ask them, what
    are you doing and why are you doing it and what is the support
    for it? I think that is wholly appropriate.
        But I would answer your earlier question to Mr. Adler
    differently. If you are worried about no trend, his answers to
    Mr. Quigley's question, was that there is no trend. Last year
    Congress passed a health-care bill. This year, it is going to
    be implemented, but it is going to come back up. And if one,
    not both, but just one house decides they don't like it, then
    it is not going to happen. And in 2 years, there will be
    another election, and maybe the other chamber will feel
    differently.
        And the ability to predict what each election--and
    elections do have consequences, I do believe that, and I agree
    with that. But are you going to change, then, every 2 years the
    possibility that the rule is on, the rule is off, the rule is
    on, the rule is off, the rule is on, the rule is off? I think
    that leads to more uncertainty, less predictability. And----
        Mr. Ross. So you would suggest that the status quo is more
    certain, in terms of assessing the regulatory risk?
        Ms. Katzen. The regularity of process. You pass a bill; you
    then turn it over to the executive branch to faithfully carry
    out the laws and to issue the regulations. I agree with Mr.
    Adler, an agency is not a free agent, cannot do whatever it
    likes. It can only do what Congress has said. But if Congress
    says, set the limits at this level, and the agency does that,
    it is faithfully carrying out the decision that Congress
    enacted.
        Mr. Ross. But wouldn't you agree that, in terms of
    accountability, that you have a greater degree of
    accountability where you have elected representation?
        Ms. Katzen. Yes. And the initial statute that was passed
    that authorizes the agencies is one that is fully accountable
    because it was bicameral and presentment. It was passed by both
    houses of Congress, and it was signed by the President.
        And the fact that now one house may think differently about
    it does not lead to greater accountability. What about the
    other house, which may like the idea? You have gridlock, you
    have problems. And I think those problems create greater
    uncertainty for businesses.
        Mr. Ross. But with regard to gridlock--and, again, just to
    point out something real quickly here--in terms of the bill,
    the content of the bill says that, within 3 days of the
    regulatory rule, that Senate shall introduce their joint
    resolution. So there would not be--there would be an expedited
    fashion. So I take issue with you, there being gridlock there.
        But I see my time has expired. Thank you.
        Mr. Gowdy. Thank you.
        On behalf of all of us, we would like to thank our
    witnesses for their testimony today.
        Without objection, all Members will have 5 legislative days
    to submit to the Chair additional written questions for the
    witnesses, which we will forward and ask the witnesses to
    respond as promptly as they can so their answers may be part of
    the record.
        Without objection, all Members will have 5----
        Mr. Conyers. Mr. Chairman, I ask unanimous consent to enter
    into the record the CRS report on total costs and benefits of
    rules.
        Mr. Gowdy. Without objection.
        Mr. Conyers. Thank you.
        [The information referred to follows:]

                                   __________

        Mr. Gowdy. Without objection, all Members will have 5
    legislative days to submit any additional materials for
    inclusion into the record.
        With that, on behalf of all of us, thank you for your
    expertise, for your time, and your participation.
        This hearing is adjourned.
        [Whereupon, at 5:35 p.m., the Subcommittee was adjourned.]

                                A P P E N D I X

                                  ----------

                   Material Submitted for the Hearing Record

        Responses to Post-Hearing Questions from Sally Katzen, Visiting
     Professor, New York University School of Law, Senior Advisor, Podesta
                                     Group

              Report from the Center for Progressive Reform (CPR)