Regulation Questions Divide White House

REGULATION of American life is on an upsurge after roughly a ten-year pause that spanned the Carter and Reagan administrations.The Clean Air Act alone, passed in 1990, is now being translated from law into 55 federal regulations that may cost the economy over $25 billion. The increasing amount of regulation seems to put the Bush administration mildly at war with itself. The administration has supported many of the new laws - from the Americans with Disabilities Act to the Clean Air Act to the new Civil Rights Act - that impose new limits and requirements on business. But within the White House, certain camps are aggressively trying to restrain the reach of regulation. One was former Chief of Staff John Sununu, who led the in-house opposition to faster action against global warming. His successor, Samuel Skinner, does not have a similar record of skepticism toward regulation. As secretary of transportation, Mr. Skinner took "clearly an interventionist attitude," says Irwin Stelzer, a regulation expert at the American Enterprise Institute. Another is White House counsel C. Boyden Gray, who led the battle against Congress-led versions of the Civil Rights Act that were more burdensome to business. Mr. Gray's does not figure as centrally in most policy areas. The rising center of anti-regulatory action is Vice President Dan Quayle's Competitiveness Council. The council was the central forum for rewriting the definition of wetlands, a change that federal agencies calculated would cut in half the national acreage subject to federal wetland regulation. One conservative on the White House staff casts the battle over regulation as one between elected officials and "faceless bureaucrats" on congressional staffs and in federal agencies. After a law is passed, the official explains, "bureaucrats in the agencies, staff on Capitol Hill, and special-interest groups get together and they write regulations that go beyond the legislation." For example, when the Environmental Protection Agency (EPA) drafted regulations to carry out a law limiting emissions from municipal incinerators, it included a requirement that the incinerators separate out and recycle 25 percent of the garbage before burning it. "The legislation didn't call for recycling," he says, adding that EPA "bureaucrats" just thought it was a good idea. When challenged, the EPA estimated that the cost would run $200 million above the benefits. The recycling provision was stripped out of the regulation, with the approval of EPA Administrator William Reilly. But, the White House official says, an agency like the EPA has only about 30 political appointees running an agency with thousands of career employees with their own ties to congressional staff and outside pressure groups. Many elected officials in Congress, in fact, are not at all comfortable with the role of White House staffers in paring down regulation. And in the case of the Civil Rights Act, the president himself sided against the deregulators on his own staff when Mr. Gray drafted a very conservative statement on how the act would be applied. The Clean Air Act, the Americans with Disabilities Act, and the Civil Rights Act are all intended to achieve social goals that the American body politic has decided to pay for. Americans have decided, in effect, to pay the price and buy a cleaner environment and social justice. But the economic cost, conservatives point out, is high and getting higher. A study published this year in the Yale Journal of Regulation estimated the cost burden on the private sector to run between $123 billion and $154 billion. An even more comprehensive estimate by a Rochester Institute of Technology economist put the annual cost of regulation at $395 billion to $510 billion a year - or $4,100 to $5,400 per household. President Carter launched a period of economic deregulation, such as airline deregulation, that was sustained during the Reagan administration. Social and environmental regulation, however, held fast. In the Bush administration, regulation is again on the rise. "It's a re-regulation trend," says Dr. Stelzer of AEI. The Competitiveness Council, which consists of Quayle, several cabinet members, and a small professional staff, has taken on some broad targets for deregulation. One of its most recent proposals has been to speed up the approval of new drugs by the Food and Drug Administration. The administration claims that its reforms can shorten the average development time for drugs from 10 years to 5.5 years for life-threatening diseases. Critics see a threat to public safety in the proposal's effort to farm testing out to private contractors.