On January 18, 2011, President Barack Obama penned an editorial, Toward a 21st-Century Regulatory System, for the Wall Street Journal in which he discussed the need for regulatory reform across the federal government. The President addressed the importance “common sense rules” have had to protect the American people “without unduly interfering with the pursuit of progress and the growth of our economy.”
However, acknowledging that the the regulatory landscape had become unruly he announced that he had issued an Executive Order mandating an overhaul of federal regulations. Among the issues he highlighted in the editorial was the toll regulations take on small businesses in America:
We’re also getting rid of absurd and unnecessary paperwork requirements that waste time and money. We’re looking at the system as a whole to make sure we avoid excessive, inconsistent and redundant regulation. And finally, today I am directing federal agencies to do more for- and reduce- the burdens regulations may place on small businesses.
The Executive Order – “Improving Regulation and Regulatory Review” – sets out the basis for the regulatory reform:
Our regulatory system must protect public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation. It must be based on the best available science. It must allow for public participation and an open exchange of ideas. It must promote predictability and reduce uncertainty. It must identify and use the best, most innovative and least burdensome tools for achieving regulatory ends. It must take into account benefits and costs, both quantitative and qualitative. It must ensure that regulations are accessible, consistent, written in plain language, and easy to understand. It must measure, and seek to improve, the actual results of regulatory requirements.
To reach the goals President Obama has to reform the regulatory system in the Federal government, the Executive Order provides that each agency (e.g. the Food and Drug Administration, the United States Patent and Trademark Office, and the Environmental Protection Agency) develop and submit a plan to the White House within 120 days of the date of the order that addresses how its regulations “should be modified, streamlined, expanded, or repealed so as to make the agency’s regulatory program more effective and less burdensome in achieving the regulatory objectives.”
The Executive Order also provides significant reform to the process Federal agencies currently follow to adopt and implement regulations. The current process is fairly tedious and difficult to participate in unless you have regulatory counsel or lobbyists on retainer who spend significant time with the regulators and reviewing the Federal Register. Moving forward Federal agencies will have to make the process more accessible to the general public to allow for an “open exchange of information” and a variety of perspectives. To accomplish the goal, agencies will have to use the internet as a platform to communicate with the public on proposed regulations, and offer the public at least 60 days to comment through the website http://www.regulations.gov.
Finally, the Executive Order recognizes that the jurisdiction of agencies often overlap resulting in “redundant, inconsistent and overlapping” regulations. Therefore, the Executive Order provides that agencies coordinate with one another to simplify and harmonize the regulations. In his editorial in the Wall Street Journal, President Obama highlights the different treatment saccharine receives from regulators (the FDA has deemed it safe while the EPA treats it as a toxic material).
A more robust and accessible regulatory landscape will allow for more voices to be heard during the rulemaking process. Additionally, trimming the unruly regulatory landscape that has developed over the past 75 years will allow small and mid-size businesses to innovate without concern that dormant regulations may have a negative impact. Finally, the government will have the benefit of hearing from a variety of experts and not just big companies and special interests.
So small and mid-size companies, and individual experts too, keep an eye out for regulations that directly impact your businesses or issues. There should be many opportunities for you to participate in the regulatory reform process. Your voice is key to creating the 21st Century Regulatory System President Obama has announced.