In the News

President Obama announced yesterday his selection of Howard Shelanski as the next Administrator of the Office of Information and Regulatory Affairs in the White House. OIRA, although not widely known, reviews the regulations that are adopted by nearly all federal agencies: everything from EPA rules to limit mercury pollution from power plants to TSA rules governing airport screening procedures. This will give Shelanski enormous power to shape the remainder of the Obama administration’s regulatory agenda.

“It’s a kind of a thankless job,” said Michael Livermore, executive director of the Institute for Policy Integrity at the New York University School of Law.

“You’re almost guaranteed to have a lot of forces aligned against you and unhappy with you,” said Livermore, who called Shelanski a “balanced thinker” who understands the complex regulatory process.

“He is a sophisticated legal scholar who is up to date on the most recent research on regulatory economics, but also someone who has an inside view on the real challenges that agencies face,” said Michael Livermore, executive director of the Institute for Policy Integrity at New York University.

“The Globalization of Cost-Benefit Analysis in Environmental Policy,” a new book by Michael Livermore and Richard Revesz, discusses what they consider the growing use of CBA outside of the United States, where it got its start as a tool for assessing regulations. Perhaps the most interesting part of the book concerns developing countries.

We need to pay to repair our roads and bridges; but there is no reason, in principle, for funding to be linked to gas taxes. The government can use income taxes, tolls and other revenue-raising mechanisms to cover the costs.

One advantage of using gas taxes to pay for our roadways is that gas taxes help to “internalize” the price of pollution into a gallon of gas. Without some kind of price signal, gas is cheaper than it should be because no one is paying for the harm caused by emissions of greenhouse gases and other air pollutants.

On the eve of Gina McCarthy’s first Senate committee hearing towards her confirmation, we find our work a potential topic of conversation between certain senators and the candidate for EPA Administrator.

Four senators on the Environment and Public Works Committee, including James Inhofe and David Vitter, sent a letter to Ms. McCarthy asking for her take on a petition the Institute for Policy Integrity, which we direct, submitted to the EPA in 2009. There are now reports that they plan to raise the question during tomorrow’s hearing.

Vitter also said McCarthy and the EPA have worked with left-leaning environmental groups on crafting stringent carbon regulations and hiding this from Congress.
He sent a letter to McCarthy in March to ask her about the intent of the Institute for Policy Integrity at the New York University School of Law to threaten litigation as a way to “force a cap-and-trade system on the transportation fuels sector” – a process known as “sue and settle.”

“Such a process is wholly unacceptable, especially considering the administration’s pattern of excluding states and economically impacted individuals and businesses from important rule-making decisions,” Vitter wrote.

Republican panel members are also likely to quiz McCarthy on whether EPA might use the Clean Air Act to implement a cap-and-trade system for transportation fuel, even though the agency has announced no such plan.

The Institute for Policy Integrity at New York University has threatened to sue EPA if it does not consider implementing the rule. The think tank says a market-based program of that kind would be the best way to reduce emissions from the transportation sector while limiting cost. It would ultimately apply to fuels for all motor vehicles and aircraft.

But Vitter, Inhofe and Sens. Deb Fischer (R-Neb.) and Roger Wicker (R-Miss.) responded late last month by demanding that McCarthy say whether the agency planned to quickly accommodate IPI’s petition (E&ENews PM, March 28).

As Michael Livermore of the Institute for Policy Integrity, a group that favors cost-benefit analysis, argues: “the fact that cost-benefit analysis is brought in by the courts for financial reform in a way that is contentious, unclear, without a lot of guidance, and in a politically charged way, entrenches views on opposite sides of the debate.”

GOP senators used a New York University-based think tank’s push for a greenhouse gas cap-and-trade system for the fuel sector’s emissions to criticize U.S. EPA as overly eager to settle lawsuits filed by environmentalists seeking more regulations.

Four members of the Senate Environment and Public Works Committee said in a letter to EPA that using the Clean Air Act’s Section 211 to regulate greenhouse gases would “expand environmental regulation beyond original intent of the law and could have detrimental effects on the livelihoods of our fellow Americans.”