What's the Difference Between ‘Major,’ ‘Significant,’ and All Those Other Federal Rule Categories? A Case for Streamlining Regulatory Impact Classification
CEI Issue Analysis No. 8, 2017
28 Pages Posted: 21 Sep 2017
Date Written: September 13, 2017
Bureaucracy, rather than interaction with elected representatives, dominates the relationship of the individual to the government. The number of rules promulgated by executive branch agencies far outstrips the number of laws passed by Congress, which makes getting a handle on the impact of federal regulation daunting. Further complicating the federal regulatory enterprise is an array of official designations of rule types and effects. Some types of rules are defined in legislation; some in executive orders; other designations were the creations of administrators.
Not knowing what to call regulatory actions nor how to clearly disclose their impact is a significant but artificially created obstacle to addressing regulatory overreach. As the administrative state grows, it becomes increasingly difficult to discern the significance of the various kinds of significant and major rules — as well as of the myriad seemingly minor rules. Policy makers need to increase democratic accountability for the rules and mandates Americans with which Americans contend by reclaiming its Article I lawmaking power and ending over-delegation to the executive branch.
To facilitate this, lawmakers should inventory, simplify and consolidate the federal bureaucracy’s increasingly confusing nomenclature, which includes rule categories like “major,” “non-major,” “significant,” “economically significant,” and numerous others. That streamlining must also extend to guidance documents, memoranda, interpretive bulletins, and other issuances that agencies use to implement policy without always following the Administrative Procedure Act’s notice-and-comment rulemaking requirements.
Reporting on rules, especially on the major ones, could be refined by deciding between the terms “significant” or “major” rules to create more uniformity, by greatly expanding disclosure of guidance, and by subjecting guidance to reforms that treat it like ordinary rules. The streamlined categories could be given greater clarity by assigning cost estimate tiers to rules — such as for example, those with estimated annual costs above $50 million and below $100 million, above $100 million and below $150 million, and so on. Further clarity would come from segregating regulations by categories such as paperwork, economic, social, safety, environmental; and those addressing agency internal operations that nonetheless get lumped in with other “rules.”
It is time for some nomenclature scrubbing. Today’s complexity helps preserve a large, unwieldy, and undemocratic bureaucracy that deadens our economy and society.
Keywords: Regulation, APA, Administrative Procedure Act, Executive Orders, Regulatory Budget, Economically Significant
JEL Classification: H10, H11, H50, H60
Suggested Citation: Suggested Citation