James S. Brady Press Briefing Room
4:01 P.M. EST
MR. CZWARTACKI: Good afternoon. We are here for a little briefing by Neomi Rao, who is the Administrator of the Office of Information and Regulatory Affairs within the OMB. She will be here to offer a brief statement and take a few questions. For those on the phone or for anyone else, her name is spelled N-E-O-M-I, last name Rao, R-A-O.
And so without further ado -- oh, one other point, she may call upon some staff that she has with her. Those staffers are on background, but everything else she says is on the record.
And without further ado, Neomi. Come on up, Neomi.
MS. RAO: Thanks, CZ. Great. So I'm very glad that the President was able to draw some attention today to the regulatory reform efforts that he has so successfully put in place.
And I just wanted to say a little bit -- I think what we've achieved is some remarkable success in the area of regulatory reform, and I can mention some of the information, some of the data we have released. And I also wanted to just talk about how we're doing this in a responsible way that is consistent with the law and also in a way that is promoting the principles of good government.
So the President mentioned in his speech -- you know, he called, in January, to eliminate two regulations for each new one. In fact, through the end of September -- so through the end of fiscal year '17, we are actually at 22 regulations eliminated for each new one, which is 67 deregulatory actions and 3 regulatory actions.
That should result in a savings of $8.1 billion in present-value terms. So that is a net reduction in regulatory costs.
Also, looking ahead for fiscal year '18, today, we released the agenda, which is an annual document released by OIRA. And in that, you can see we're on track to continue to be better than three for one. The agenda reflects 448 deregulatory actions and 131 regulatory actions. And agencies project that that's going to lead to about $10 billion in present-value cost savings. So we're planning to keep up the deregulatory efforts.
And there is -- you know, many commentators have suggested there is a link between these reform efforts and economic growth. I think one of the advantages of what is happening now is that individuals and businesses aren't fearing the constant perpetuation of new regulatory burdens without any notice or due process.
From my perspective, a lot of this is linked to individual freedom. When the government is interfering less in people's lives, they have a greater opportunity to pursue their goals. I also think that what we're doing here is connected to making government more constitutional, which means that we're working to ensure that agencies stay within the law, that they're acting consistent with their statutory requirements, their procedural requirements, and we're helping to promote better accountability in agencies.
And I also wanted to say that we're working on this all in a way that's consistent with longstanding principles at OIRA. We're doing cost-benefit analysis for both regulatory and deregulatory actions in the same way. So we're trying to be responsible and follow our longstanding practices with respect to deregulation as well as regulation.
And finally, if you look online, all of this information has been uploaded to RegInfo.gov, which is our website. And I think you'll see that, if you're familiar with the agenda, this is a very transparent agenda. We've improved search capabilities. You can look for actions based on whether they're regulatory or deregulatory. We have provided a lot of information about how we are doing the cost allocations and the accounting under Executive Order 13771.
So we're working on that transparency, and we continue to work with agencies on promoting the values of due process and fair notice.
So with that, I'll be happy to take your questions.
Q: I'm Tara McKelvey. I'm with the BBC. I'm wondering if you can tell us about the taskforces. And you talked about transparency and about the make-up of the taskforces -- who these people are, and how we can be confident that they're not facing conflicts of interest.
MS. RAO: Sure, so the agencies are responsible for the taskforces. At OIRA, we don't have any database of who was on the taskforces. We work largely with the regulatory reform officers.
You know, I think most of the taskforces, my understanding is, are a mix of career professionals as well as political appointees. In some cases, they are mostly career officials and not political appointees. So I think it varies a lot from agency to agency. There have been some hearings in Congress about this, where agencies have testified more about their make-up, so I would refer you to that.
Q: Could you explain the -- you said there's $8.1 billion in lifetime net regulatory cost savings, the equivalent of $570 million per year. So just -- what does that -- that means that the -- you estimate that the savings per year is $570 million, but what is the difference between those two numbers? How did you find that?
MS. RAO: Well, the $8.1 billion is a present value number, using 7 percent discount rate.
Q: Over the lifetime. So that --
MS. RAO: Over the lifetime, in perpetuity.
Q: So all the changes result in an estimated $570 million a year in savings -- in cost savings is what you're --
MS. RAO: In cost savings, that's correct.
Q: And then can you just -- in the breakdown, you said there's 67 regulatory actions and 3 new regulatory actions. I'm a little confused by that because that number is so different from the 1,579. What is that 67 and 3?
MS. RAO: Sure, so the 67 to 3, those are actions that are actually completed through the end of September, and there's a list of them on the website.
And those deregulatory actions include rules that have been pulled back. They also include other types of deregulatory actions, such as the withdrawal of guidance documents or reductions in paperwork burdens. So there are number of different things that count, and you can see the list on the website. And the three regulatory actions are significant regulatory actions.
Q: And so that 67 is different from the 1,579. Those are not -- they're counted differently?
MS. RAO: That's right. Well, the 1,579 are -- I mean, those -- you can think of those as a group of rules that we're reconsidering. Right? So some of them are withdrawn, so they can't really come back unless an agency puts them back on the agenda. And some of them are just delayed, so they're just rules agencies may be reconsidering.
Q: So that hardest of numbers is the 67. That's the things that are actually gone.
MS. RAO: That is what's actually gone through the end of September.
MS. RAO: I think that's really the right number to focus on --
Q: And does that include the Congressional -- this Congressional Review Act? Or is that does or does not?
MS. RAO: It includes the Congressional Review Act actions that were also then followed through with, with new rules. So, it includes most of those.
Q: So, 14 or 15 of that 67 is --
MS. RAO: What is the -- I think, maybe -- I think it's 12 of them are counted in that, because some of them needed further regulatory action to be implemented. And so, if those were completed, then that's in the 67.
Q: Thank you. Sorry for so many questions.
Q: Is there a list of those 1,579 -- like a detailed list -- as part of this? Or would you guys be willing to provide that?
MS. RAO: Is there a detailed list of that on the --
SENIOR ADMINISTRATION OFFICIAL: It's all searchable now on the database. It's been updated, so it's --
MS. RAO: I think you can search for that on the website. Yep.
Q: And then it seemed like there was a jump in the number of rules that remained inactive (inaudible) from spring. I'm wondering, did you just find more? Or can you explain why that seemed to go up, I think from 109 to 166?
MS. RAO: On the inactive list. Yeah, so I think 244 regulations were made inactive since the fall 2016 agenda. And so, yes, there were additional things that were moved to the inactive list.
And, I mean, this is -- I mean, it's sort of a fluid list because agencies may decide to start to reconsider something. But we're trying to be as transparent as possible about what's on it right now.
Q: Just another question about the numbers: is the $570 million a year based on the 67 completed deregulatory actions?
MS. RAO: Yes.
Q: Okay. So the additional savings --
MS. RAO: So that is the final number of cost savings for fiscal year 17.
Q: And for actions that have already been taken.
MS. RAO: That's right.
Q: So it does not include the 1,500 --
MS. RAO: No. Those are really -- I mean you should just think of those as an additional part of what's happening, right? Those are things that we are reconsidering.
You know, I think the thing to look at is, through fiscal year '17, we're at 22-for-1 -- that's a hard number -- and at $8.1 billion in net present value of regulatory savings. And the other things are prospective, really.
Q: You guys categorize the 1579 as planned regulations that were withdrawn or delayed -- so regulations that maybe haven't come into effect yet, or were still in the process of being written. So as the administration looks to make more headway on permanent regulations, what's the governing principle? And what are you asking agencies to look for?
MS. RAO: Sure. Well, a lot of these things really are up to the agencies, right? They're taking a closer look at a lot of these rules. And one of the things that we're focused on is making sure the rules that are on the books are actually benefiting the American people.
So one of the things that happens -- and our deregulatory actions have to meet the same standards as our other regulatory actions. So that means when we're deregulating, the benefits of deregulation are higher than the costs of the deregulation, right? So they are creating net benefits for people, and so we're looking for deregulatory effects that can meet that standard, right? Where the deregulation is actually more beneficial than keeping the regulation on the books.
Q: How many more regulations do you think there are to undo or withdraw? Because the President said, a year ago, that he wanted to undo 70 to 80 percent of federal regulations. How much more do you conceive that this effort can do?
MS. RAO: I think that there is still a long way to go. It would be very hard for me to quantify what that number is, but we are looking closely at a number of regulatory actions.
Q: Is it apples-to-apples to compare the 2-to-1 in the executive order to the 22-to-1 today?
MS. RAO: Yes, I think, absolutely.
Q: The executive order said regulations. So all the 22-to-1, all those regulatory actions are -- that is a regulation that was rescinded or a regulation that was approved?
MS. RAO: So, we have the executive order. A couple months after that, OIRA issued a guidance document explaining how we would interpret and implement the executive order, which is quite detailed -- much more detailed than the executive order.
And this was before I was confirmed, but that guidance explains that they are going to count a variety of different actions as deregulatory.
Q: So, in other words, the word "regulation" in the original executive order and the word "regulatory action" today are not necessarily describing the same thing? You're not saying there's 67 federal regs that are gone?
MS. RAO: No, we are not saying that. And the list makes it clear that some of those are guidances or information collections or things like that. So deregulatory actions is a broader category than just regulations. That's correct.
Q: When the President suggested that you could perhaps get down to like 1960-level of -- that's just an expression. There's no way the federal government, in its size and of this population growth, could ever get to -- is he just sort of making that as a kind of a -- is that really true that we could ever get to that point? Is that your goal?
MS. RAO: I think returning to 1960 levels would likely require legislation because there are a number of regulations that are based on statutory requirements. And I don't know what the percentage of those would be, but for -- you know, it's hard for me to know what that looks like. But I think some of that would certainly require legislation.
Q: The 67, I mean, actually seems like a pretty small number, given the kind of -- the language that we heard at that announcement earlier. It actually doesn't strike as that large of a number in a year. If you include not just regulations but guidances, I'm actually surprised it's so small. Any thoughts on that?
MS. RAO: I think it's pretty impressive. And I think -- you know, deregulation also takes time, right? So if we're doing things in a way that is careful and consistent with law, it takes time to undo the laws. Because for many rules that are undone, you need a new rule, and then you need a new regulatory impact assessment, and you need to create a rule that then can pass through the standards. So I think that that takes time. But I think, for such a short -- I mean, this is just through the end of September.
And I think -- you know, looking at the number, you're also looking at the tremendous cost savings. So it's not just the 67. It's that those have had a real meaningful impact. Over both Republican and Democratic administrations, the regulatory burdens have just increased. And we're not just slowing the rate of growth, we're actually at net negative regulatory costs. And that is a real turnaround from what's happened in the past.
Q: I guess I have one other. Do you agree with the assessment that this is the largest deregulatory effort in American history? Is there any documentation to back up that assertion?
MS. RAO: Our numbers at OIRA don't go -- it's hard to measure what that is. I think, under Reagan, my understanding is that they had years of net reductions. But I'm not sure that there has been any -- I don't think that there has been anything like this since Reagan, at least.
Q: Why does this matter? Like, why Americans should care? If you were to distill this to one punchline and explain to an average American, like, why he or she should care about this, what would be your answer?
MS. RAO: My answer is that burdensome and unnecessary regulations really hamper individual liberty. It makes it harder to start a business; it makes it harder to grow the economy. And that's true for big regulations; it's also true for small regulations that may just interfere with some group of small businesses.
And so having this enormous accumulation of regulatory burdens is a real tax on the American people, and rolling them back promotes greater freedom.
END 4:17 P.M. EST