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Federal Regulations Advisor Insight and Commentary on U.S. Government Regulatory Affairs

President Obama’s International Regulatory Harmonization Initiative – An Opinion

Posted in Executive - OMB Review

President Obama (aka POTUS) issued an Executive Order, Promoting International Regulatory Cooperation, on May 1, 2012, that increases the visibility of agencies’ interest in international regulatory harmonization, but does it really do more than reiterate platitudes?  A careful review suggest that it reiterates many of the normative functions of the regulatory review process and, perhaps, adds new routes for input and reality.  On the whole, however, requiring agencies and OMB to think through the international impacts of regulation is a welcome, if small, addition.

POTUS reiterated his view in the complex of regulatory policy development, to “protect public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation.”  Some would reverse that order of preference, but that is the normal political discourse.

The importance of the Executive Order lies in the regulatory puzzle’s new Obama Administration emphasis that

In meeting shared challenges involving health, safety, labor, security, environmental, and other issues, international regulatory cooperation can identify approaches that are at least as protective as those that are or would be adopted in the absence of such cooperation.  International regulatory cooperation can also reduce, eliminate, or prevent unnecessary differences in regulatory requirements.

Many will fear – and herein lies the real question – a globalization of regulatory process that embraces more European regulatory “at least as protective” social equation.  The concerned voiced here is whether the United States will slip further down the slippery slope toward Grecian default.

Much of the Executive Order emphasizes greater concern and more consultation, with few substantive impositions.  POTUS’s Regulatory Working Group, originally established by President Bill Clinton’s Executive Order 12866, is charged to serve as a “forum” to “discuss, coordinate, and develop a common understanding” for international cooperation in domestic regulatory actions.  These words are important, but not so important as the six reiterations of the limitations of domestic law – agencies are bound first by what Congress has delegated.

Cass Sunstein, as the locus of activity as the Administrator of the Office of Management and Budget (OMB) Office of Information and Regulatory Affairs (OIRA), has filled in a few blanks in his blog post by inviting review of the United States / Canada released the United States-Canada Regulatory Cooperation Council (RCC) Joint Action Plan and the United States-Mexico High-Level Regulatory Cooperation Council (HLRCC) Work Plan.  These documents should be reviewed by businesses and trade organizations with cross-border interests.

Sunstein went one step further in extolling the Administration’s virtues in a Wall Street Journal opinion piece, The White House vs. Red Tape, addressed to the business community more directly by reversing the priority order and focusing on divergent requirements for car headlights, or the labeling of food, or standards for container sizes.  The Wall Street Journal’s audience is told that the Executive Order has “a simple goal: to promote exports, growth, and job creation by eliminating unnecessary regulatory differences across nations.”  Sunstein sold many of the same focus points in a speech to the Chamber of Commerce covered by Businessweek and others.

Audience is important, and many audiences may be served by a single action.  Here, however, the Executive Order has little substance and much process that is inherently discretionary.  The selling of the Executive Order has more substance and less consistency.  None is surprising – what will be surprising is any substance that comes out of the Executive Order because an Executive Order is not a substitute for good analysis and decisionmaking – it can only foster that analysis and decisionmaking.  Welcome, if small, addition – with concerns.