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AMENDING EXECUTIVE ORDER 12866: GOOD

GOVERNANCE OR REGULATORY USURPATION?

HEARING

BEFORE THE

SUBCOMMITTEE ON 

COMMERCIAL AND ADMINISTRATIVE LAW

OF THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

FEBRUARY 13, 2007

Serial No. 110–2

Printed for the use of the Committee on the Judiciary

(

Available via the World Wide Web: http://judiciary.house.gov 

(II)

COMMITTEE ON THE JUDICIARY 

JOHN CONYERS, JR., Michigan, Chairman 

HOWARD L. BERMAN, California 

RICK BOUCHER, Virginia 

JERROLD NADLER, New York 

ROBERT C. SCOTT, Virginia 

MELVIN L. WATT, North Carolina 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

MARTIN T. MEEHAN, Massachusetts 

WILLIAM D. DELAHUNT, Massachusetts 

ROBERT WEXLER, Florida 

LINDA T. SA ́ NCHEZ, California 

STEVE COHEN, Tennessee 

HANK JOHNSON, Georgia 

LUIS V. GUTIERREZ, Illinois 

BRAD SHERMAN, California 

ANTHONY D. WEINER, New York 

ADAM B. SCHIFF, California 

ARTUR DAVIS, Alabama 

DEBBIE WASSERMAN SCHULTZ, Florida 

KEITH ELLISON, Minnesota 

[Vacant] 

LAMAR SMITH, Texas 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

HOWARD COBLE, North Carolina 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

STEVE CHABOT, Ohio 

DANIEL E. LUNGREN, California 

CHRIS CANNON, Utah 

RIC KELLER, Florida 

DARRELL ISSA, California 

MIKE PENCE, Indiana 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

TOM FEENEY, Florida 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio

PERRY APELBAUM, Staff Director-Chief Counsel 

SEAN MCLAUGHLIN, Deputy Chief Minority Counsel/Staff Director 

SUBCOMMITTEE ON COMMERCIAL AND ADMINISTRATIVE LAW

LINDA T. SA ́ NCHEZ, California, Chairwoman 

JOHN CONYERS, JR., Michigan 

HANK JOHNSON, Georgia 

ZOE LOFGREN, California 

WILLIAM D. DELAHUNT, Massachusetts 

MELVIN L. WATT, North Carolina 

[Vacant] 

CHRIS CANNON, Utah 

JIM JORDAN, Ohio 

RIC KELLER, Florida 

TOM FEENEY, Florida 

TRENT FRANKS, Arizona

MICHONE JOHNSON, Chief Counsel 

DANIEL FLORES, Minority Counsel 

(III)

C O N T E N T S 

FEBRUARY 13, 2007

OPENING STATEMENT 

Page 

The Honorable Linda T. Sa ́nchez, a Representative in Congress from the 

State of California, and Chairwoman, Subcommittee on Commercial and 

Administrative Law ............................................................................................. 1

The Honorable Chris Cannon, a Representative in Congress from the State 

of Utah, and Ranking Member, Subcommittee on Commercial and Administrative Law ........................................................................................................... 16

The Honorable John Conyers, Jr., a Representative in Congress from the 

State of Michigan, Chairman, Committee on the Judiciary, and Member, 

Subcommittee on Commercial and Administrative Law .................................. 18

WITNESSES 

Mr. Steven D. Aitken, Acting Administrator, Office of Information and Regulatory Affairs, Office of Management and Budget 

Oral Testimony ..................................................................................................... 21

Prepared Statement ............................................................................................. 23

Ms. Sally Katzen, Professor, University of Michigan Law School 

Oral Testimony ..................................................................................................... 49

Prepared Statement ............................................................................................. 50

Mr. Curtis W. Copeland, Ph.D., specialist in American National Government, 

Congressional Research Service 

Oral Testimony ..................................................................................................... 56

Prepared Statement ............................................................................................. 57

Mr. Paul R. Noe, Partner, C&M Capitolink LLC, and Counsel, Crowell & 

Moring Environment & Natural Resources Group 

Oral Testimony ..................................................................................................... 80

Prepared Statement ............................................................................................. 82

Mr. Peter L. Strauss, Professor, Columbia University School of Law 

Oral Testimony ..................................................................................................... 91

Prepared Statement ............................................................................................. 92

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Prepared Statement of the Honorable Linda T. Sa ́nchez, a Representative 

in Congress from the State of California, and Chairwoman, Subcommittee 

on Commercial and Administrative Law ........................................................... 2

APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD

Post-Hearing Questions and Responses for Steven D. Aitken, Acting Administrator, Office of Information and Regulatory Affairs, Office of Management 

and Budget ........................................................................................................... 108

Post-Hearing Questions and Responses for Sally Katzen, Professor, University 

of Michigan Law School ....................................................................................... 125

Post-Hearing Questions and Responses for Curtis W. Copeland, Ph.D., specialist in American National Government, Congressional Research Service .. 136

Page

IV

Post-Hearing Questions and Responses for Paul R. Noe, Partner, C&M 

Capitolink LLC, and Counsel, Crowell & Moring Environment & Natural 

Resources Group ................................................................................................... 138

Post-Hearing Questions and Responses for Peter L. Strauss, Professor, Columbia University School of Law ........................................................................ 304

(1)

AMENDING EXECUTIVE ORDER 12866: GOOD 

GOVERNANCE OR REGULATORY USURPATION? 

TUESDAY, FEBRUARY 13, 2007

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON COMMERCIAL

AND ADMINISTRATIVE LAW, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC.

The Subcommittee met, pursuant to notice, at 2:05 p.m., in Room 

2141 of the Rayburn House Office Building, the Honorable Linda 

Sa ́nchez (Chairwoman of the Subcommittee) presiding. 

Ms. SA ́ NCHEZ. The hearing of the Subcommittee on Commercial 

and Administrative Law will now come to order. 

I would like to begin by welcoming everyone to the first hearing 

of this Subcommittee of the 110th Congress, and in particular I 

wish to extend warm regards to the Ranking Member of the Subcommittee, Mr. Cannon. I very much look forward to our working 

together. I would also like to welcome the two newest Members to 

the Judiciary Committee, Mr. Johnson and Mr. Jordan, to the Subcommittee. 

At the request of a minority Member of the Science Committee, 

we moved the starting time of this hearing from 1 to 2 p.m. to accommodate the Science Committee hearing that has just concluded, 

and I appreciate the cooperation of our Ranking Member and the 

indulgence of our witnesses and attendees. 

I will now recognize myself for a short statement. 

Over the last several weeks, I have been reading some very disturbing news reports and commentaries about an Executive Order 

issued last month by President Bush. The new Order substantially 

amends Executive Order 12866, an Order that has guided the OMB 

regulatory review process for the last 13 years. This new Order requires agencies to identify specific ‘‘market failures’’ or problems 

that warrant a new regulation. Furthermore, agency heads are now 

required to designate a presidential appointee as an ‘‘agency policy 

officer’’ to control upcoming rulemaking. In a sense, the Executive 

Order politicizes regulations, many of which were specifically created by experts to protect the health and safety of our citizens. I 

am concerned that the main thrust of this new Order appears to 

shift control of the regulatory process from the agencies—the entities that have the most substantive knowledge and experience to 

the White House. 

2

The primary purpose of this regulatory process is to provide 

guidance and interpret technical policies, often at the request of industry. Unfortunately, we don’t know what prompted President 

Bush to undertake a major overhaul of this proven process. There 

is some speculation as to the Administration’s reasoning. The New 

York Times, for example, reported that this new Executive Order 

‘‘strengthens the hand of the White House in shaping rules that 

have, in the past, often been generated by civil servants and scientific experts.’’ Others claim that this is just another clandestine 

‘‘power grab’’ by the Administration. 

These thoughts and concerns are not just being expressed by the 

so-called liberal media or partisan hacks. CRS, for example, says 

that the revisions made by Executive Order 13422 ‘‘represent a 

clear expansion of presidential authority over rulemaking agencies.’’ CRS also notes that the Order can be viewed as part of a 

broader statement of presidential authority presented throughout 

the Bush administration—from declining to provide access to Executive Branch documents and information to creating presidential 

signing statements indicating that certain statutory provisions will 

be interpreted consistent with the President’s view of the ‘‘unitary 

executive.’’

That is a rather serious observation coming from a preeminently 

nonpartisan source. And the fact that Subcommittees from both the 

Judiciary and Science Committees are looking into this issue I 

think underscores the serious concerns that the Order appears to 

present. 

To help shed some light on these issues, we have with us today 

a truly notable witness panel. We are pleased to have a representative from the Administration, as well as two former Administration 

officials. We also have the author of the CRS report that I mentioned earlier, as well as one of the leading academics on presidential review of rulemaking. Accordingly, I very much look forward to hearing their testimony, and appreciate their willingness 

to participate. 

[The prepared statement of Ms. Sa ́nchez follows:]

PREPARED STATEMENT OF THE HONORABLE LINDA T. SA ́ NCHEZ, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF CALIFORNIA, AND CHAIRWOMAN, SUBCOMMITTEE ON

COMMERCIAL AND ADMINISTRATIVE LAW

Over the last several weeks, I’ve been reading some very disturbing news reports 

and commentaries about an executive order issued last month by President Bush. 

The new Order substantially amends Executive Order 12866, an order that has 

guided the OMB regulatory review process for the last 13 years. This new Order 

requires agencies to identify specific ‘‘market failures’’ or problems that warrant a 

new regulation. Furthermore, agency heads are now required to designate a presidential appointee as an ‘‘agency policy officer’’ to control upcoming rulemaking. 

In a sense, this Executive Order politicizes regulations, many of which were specifically created by experts to protect the health and safety of our citizens. 

I am concerned that the main thrust of this new Order appears to shift control 

of the regulatory process from the agencies—the entities that have the most substantive knowledge and experience—to the White House. 

The primary purpose of this regulatory process is to provide guidance and interpret technical policies, often at the request of industry. 

Unfortunately, we don’t know what prompted President Bush to undertake a 

major overhaul of this proven process. 

There is some speculation as to the Administration’s reasoning. The New York 

Times, for example, reported that this new Executive Order ‘‘strengthens the hand 

3

of the White House in shaping rules that have, in the past, often been generated 

by civil servants and scientific experts.’’

Others claim this is just another clandestine ‘‘power grab’’ by the Administration. 

These thoughts and concerns are not just being expressed by the so-called liberal 

media or partisan hacks. CRS, for example, says the revisions made by Executive 

Order 13422 ‘‘represent a clear expansion of presidential authority over rulemaking 

agencies.’’

CRS also notes that the Order ‘‘can be viewed as part of a broader statement of 

presidential authority presented throughout the Bush Administration—from declining to provide access to Executive branch documents and information to creating 

presidential signing statements indicating that certain statutory provisions will be 

interpreted consistent with the President’s view of the ‘unitary executive.’ ’’

That’s a rather serious observation coming from a preeminently nonpartisan 

source. 

And the fact that subcommittees from both the Judiciary and Science Committees 

are looking into this issue I think underscores the serious concerns that the Order 

appears to present. 

To help shed some light on these issues, we have with us today a truly notable 

witness panel. We are pleased to have a representative from the Administration as 

well as two former Administration officials. We also have the author of the CRS report that I mentioned earlier as well as one of the leading academics on Presidential 

review of rulemaking. 

Accordingly, I very much look forward to hearing their testimony and appreciate 

their willingness to participate.

4

ATTACHMENT


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2

The primary purpose of this regulatory process is to provide 

guidance and interpret technical policies, often at the request of industry. Unfortunately, we don’t know what prompted President 

Bush to undertake a major overhaul of this proven process. There 

is some speculation as to the Administration’s reasoning. The New 

York Times, for example, reported that this new Executive Order 

‘‘strengthens the hand of the White House in shaping rules that 

have, in the past, often been generated by civil servants and scientific experts.’’ Others claim that this is just another clandestine 

‘‘power grab’’ by the Administration. 

These thoughts and concerns are not just being expressed by the 

so-called liberal media or partisan hacks. CRS, for example, says 

that the revisions made by Executive Order 13422 ‘‘represent a 

clear expansion of presidential authority over rulemaking agencies.’’ CRS also notes that the Order can be viewed as part of a 

broader statement of presidential authority presented throughout 

the Bush administration—from declining to provide access to Executive Branch documents and information to creating presidential 

signing statements indicating that certain statutory provisions will 

be interpreted consistent with the President’s view of the ‘‘unitary 

executive.’’

That is a rather serious observation coming from a preeminently 

nonpartisan source. And the fact that Subcommittees from both the 

Judiciary and Science Committees are looking into this issue I 

think underscores the serious concerns that the Order appears to 

present. 

To help shed some light on these issues, we have with us today 

a truly notable witness panel. We are pleased to have a representative from the Administration, as well as two former Administration 

officials. We also have the author of the CRS report that I mentioned earlier, as well as one of the leading academics on presidential review of rulemaking. Accordingly, I very much look forward to hearing their testimony, and appreciate their willingness 

to participate. 

[The prepared statement of Ms. Sa ́nchez follows:]

PREPARED STATEMENT OF THE HONORABLE LINDA T. SA ́ NCHEZ, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF CALIFORNIA, AND CHAIRWOMAN, SUBCOMMITTEE ON

COMMERCIAL AND ADMINISTRATIVE LAW

Over the last several weeks, I’ve been reading some very disturbing news reports 

and commentaries about an executive order issued last month by President Bush. 

The new Order substantially amends Executive Order 12866, an order that has 

guided the OMB regulatory review process for the last 13 years. This new Order 

requires agencies to identify specific ‘‘market failures’’ or problems that warrant a 

new regulation. Furthermore, agency heads are now required to designate a presidential appointee as an ‘‘agency policy officer’’ to control upcoming rulemaking. 

In a sense, this Executive Order politicizes regulations, many of which were specifically created by experts to protect the health and safety of our citizens. 

I am concerned that the main thrust of this new Order appears to shift control 

of the regulatory process from the agencies—the entities that have the most substantive knowledge and experience—to the White House. 

The primary purpose of this regulatory process is to provide guidance and interpret technical policies, often at the request of industry. 

Unfortunately, we don’t know what prompted President Bush to undertake a 

major overhaul of this proven process. 

There is some speculation as to the Administration’s reasoning. The New York 

Times, for example, reported that this new Executive Order ‘‘strengthens the hand 

3

of the White House in shaping rules that have, in the past, often been generated 

by civil servants and scientific experts.’’

Others claim this is just another clandestine ‘‘power grab’’ by the Administration. 

These thoughts and concerns are not just being expressed by the so-called liberal 

media or partisan hacks. CRS, for example, says the revisions made by Executive 

Order 13422 ‘‘represent a clear expansion of presidential authority over rulemaking 

agencies.’’

CRS also notes that the Order ‘‘can be viewed as part of a broader statement of 

presidential authority presented throughout the Bush Administration—from declining to provide access to Executive branch documents and information to creating 

presidential signing statements indicating that certain statutory provisions will be 

interpreted consistent with the President’s view of the ‘unitary executive.’ ’’

That’s a rather serious observation coming from a preeminently nonpartisan 

source. 

And the fact that subcommittees from both the Judiciary and Science Committees 

are looking into this issue I think underscores the serious concerns that the Order 

appears to present. 

To help shed some light on these issues, we have with us today a truly notable 

witness panel. We are pleased to have a representative from the Administration as 

well as two former Administration officials. We also have the author of the CRS report that I mentioned earlier as well as one of the leading academics on Presidential 

review of rulemaking. 

Accordingly, I very much look forward to hearing their testimony and appreciate 

their willingness to participate.

4

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Ms. SA ́ NCHEZ. At this time, I would now like to recognize my colleague, Mr. Cannon, the distinguished Ranking Member of my Subcommittee, for his opening remarks. 

Mr. CANNON. Thank you, and welcome, Madame Chairman. 

This is—let me just say briefly to begin that we had a few problems, I think, with notice on the hearing today, and the rule requires a week’s notice for hearings. I don’t mean to be petty about 

this, but my understanding is that we have been assured by the 

Majority in the future any significant aspects of hearings won’t be 

changed without the explicit sign-off of the Subcommittee Ranking 

Member. I appreciate this and look forward to working with you on 

this and other issues. 

Welcome to the world of—through the looking glass, what do we 

call this? The world of the APA, the Administrative Procedure Act. 

And let me just say that the concerns you have raised are very important, and this is the Committee where we get to work these 

things through. And I would hope that we would continue the process of looking at this. I think it is not so much a partisan process 

as it is a very important process for how we govern ourselves here 

in America. 

Let me just say that government in the sunshine is an improved 

process for the development of coordination of potential regulations 

and significant guidance documents and hands-on management of 

that process by accountable public officials are the heart and soul 

of OMB’s new amendments to Executive Order 12866. They are to 

be celebrated and they are what this hearing really should be 

about: good governance and assuring that regulation is guided by 

officials accountable to the people through the political process and 

not usurped by unaccountable Federal agency employees. 

The Executive Order amendments are about government in the 

sunshine because they are part of OMB’s commendable and sustained effort to bring about government by guidance without sufficient notice and comment by the public under control. They are 

also about government in the sunshine because they are specifically related to a noted and comment proceeding which provides 

every interested party in the Nation an opportunity to tell OMB 

whether they thought OMB’s good guidance proposals were good or 

bad ones. 

The response was clear. The vast majority of comments supported the effort. OMB’s Executive Order, amendments, and the 

final bulletin for agency good guidance practices that the amendments accompanies contemporaneously formed the capstone of that 

process. The importance of these developments to good government 

should not be underestimated, as the D.C. circuit trenchantly observed in 2000 when it addressed the troubled and widespread use 

of government by guidance in its Appalachian Power decision ‘‘The 

phenomenon we see in this case is familiar. Congress passes a 

broadly worded statute. The agency follows with regulations containing broad language, open-ended phrases, ambiguous standards, 

and the like. Then as years passed, the agency issues circulars or 

guidance or memoranda explaining, interpreting, defining, and 

often expanding the commands in regulations. One guidance document may yield another, and then another and so on. Several 

words in a regulation may spawn hundreds of pages of text as the 

17

agency offers more and more detail regarding what its regulations 

demand of regulated entities. Laws made without notice and comment, without public participation, and without publication in the 

Federal Register or the Code of Federal Regulations.’’ Appalachian 

Power Company, VEPA, et cetera. 

The Executive Order amendments in OMB’s Good Guidance Bulletin are the latest positive steps toward turning that around. 

What better way to begin to stem this tide than to bring significant 

guidance statements under increased management by the accountable and responsive political process, and to assure that that same 

process remains engaged through the planning and development 

phases of regulations and significant guidance. 

Those are the key innovations of the Executive Order amendments and OMB should be praised for adopting them. Indeed, that 

praise should be high praise. 

What kind of guidance are we talking about bringing under the 

Executive Orders procedures? Guidance that may reasonably be anticipated to (1), lead to an annual effect of $100 million or more; 

to create serious inconsistency or otherwise interfere with an action 

taken or planned by another agency; to materially alter the budgetary impact of entitlement grants, user fees, or loan programs, 

and to raise novel, legal, or policy issues arising out of legal mandates, the President’s priorities or the principles set forth in this 

Executive Order. These are key examples. Bringing these kinds of 

truly significant guidance documents under increased and standardized review by accountable officials is a large step forward in 

good governance and should not be questioned. 

The only better approach would be for this Committee to proceed 

with its Administrative Procedure Act review, and solve many of 

these problems with clear legislation. Beyond these major improvements, the amendments largely provide useful refinements to a 

process where the procedure is already present in Executive Order 

12866, which was issued by the Clinton administration. For example, the original Order required agencies to identify what market 

failure or other problem they are proposing to address. The amendments have only made that requirement more specific, to make 

clear that the identification must be in writing and to make clear 

that the purpose of the identification is to enable assessment of 

whether any new regulation is warranted. That is, no seen change 

in the Order’s terms, but it can be expected to help better governance. In addition, the amendments allow more flexibility in the 

timing and use of regulatory prioritization and coordination meetings with agency heads. They also sensibly call not just for a cost 

benefit analysis for each planned regulation, but also for a cumulative cost benefit analysis of all regulations planned for a calendar 

year. That is intended to assist with the identification of priorities, 

clearly a salutary step. 

There have been allegations that the Executive Order amendments somehow usurp the regulatory process, taking it out of the 

hands of bureaucrats and placing it in the hands of political officials. That is not correct. The agency’s authority to regulate is an 

authority delegated to the agencies by Congress. OMB steps to assure that Congress’s delegated authority is watchfully overseen by 

18

officials that are accountable through the political process, are consistent with the source of the agency’s authority. 

It appears that this hearing is an attempt to show that the Administration is placing politics over good policy. That is not the 

case. Executive Order amendments are good policy. I commend 

OMB for its efforts and I look forward to future hearings that focus 

more directly on policy solutions to the problems that concern the 

American people, such as updating the Administrative Procedure 

Act and covering some of these issues. 

I look forward to the hearing for all of the witnesses, and again, 

Madame Chairman, congratulations, welcome, and I yield back. 

Ms. SA ́ NCHEZ. I thank the gentleman. 

It is now my pleasure to recognize at this time Mr. Conyers, the 

Chairman of the Judiciary Committee and a Member of this Subcommittee, for his opening statement. 

Mr. CONYERS. Thank you very much. I enjoy referring to the 

gentlelady from California, Linda Sa ́nchez, as the Chair of the Subcommittee on Commercial and Administrative Law, and my old 

friend, Chris Cannon, as the Ranking Member of this very important Committee on the occasion of your very first hearing, and I am 

very proud to be here with you all. 

This is an important item of the President’s Executive Order, a 

recent one altering the procedure for administrative rulemaking. 

To me, in effect the President has created a new obstacle to agencies doing their jobs under the law by requiring for the first time 

a political appointee to approve any, and maybe all, agency guidance. 

Now, this is, from a wider view I say to the distinguished witnesses who have been invited here, a part of this unprecedented 

reach for power on the part of this White House, an attempt to control the institutions that could challenge it: the courts, the Congress, and the press, and maybe a move to upset the balance of 

power among the three branches of Government. In my view, the 

Executive Order that we are looking at today represents yet another attempt to bring more authority into the Executive Branch, 

and it deserves and warrants the scrutiny of this Committee on behalf of the American people. 

Policies and regulations that are created to protect public health, 

safety, the environment, civil rights, and privacy should be created 

by experts in the field and in my view, not by political appointees. 

This deviation from past process only serves to compromise the 

protection of the public while enhancing presidential power. 

Executive Order 13422 has a requirement that a market failure 

or problem to identified to justify governmental intervention also 

marks a serious increase of regulatory control by the White House. 

It is often at the request of the industry that the agencies issue 

best practices and policies. To make them more complicated only 

seems to further interfere with the regulatory process. 

And so I am concerned that Orders like this will serve as yet another barrier to oppose consumer protection, specifically against exposure to harmful environmental pollutants and other safety and 

health requirements. A number of companies have already stated 

the regulatory rules have a significant impact on their business 

19

practices, while numerous consumer groups have complained about 

the Orders impact on public health and safety. 

And so this hearing starts this Subcommittee, its Chairman, 

Ranking Member, and Members of the Subcommittee to a very auspicious and important issue, and I congratulate you all for being 

here today. 

I thank you for the time. 

Ms. SA ́ NCHEZ. I thank the gentleman for his statement, and I 

would like to acknowledge that we have been joined by Mr. Feeney 

and Ms. Lofgren. 

In the interest of time, I would ask that other Members submit 

their statements for the record by close of business Friday. Without 

objection, all opening statements will be placed in the record. 

Without objection, the Chair will be authorized to declare a recess of the hearing at any point. 

We have been informed that our Administration witness, Mr. 

Aitken, has a tight schedule this afternoon and may need to leave 

before our hearing is concluded. We will hear from him first and 

proceed with a round of questions for him before turning to our 

other witnesses. Mr. Aitken is invited to stay with us as long as 

he is able to do so. 

Mr. CANNON. Madame Chairman, could we inquire of Mr. Aitken 

what his timeframe is, because I think that his insights through 

the course of the answering of other questions would be very important. 

Mr. AITKEN. I do believe that when I was coming to the hearing 

that I received an e-mail saying that OPM had told Government 

employees to go home, so I suspect since nobody will be back in the 

office when I arrive there that my schedule will permit me to stay 

longer. 

Mr. CONYERS. You don’t have to go home, do you, Mr. Aitken? 

Mr. AITKEN. No. 

Mr. CANNON. That is our gain and your loss, I suppose. 

Ms. SA ́ NCHEZ. Okay. That being the case, we will proceed as we 

normally do under our normal hearing schedule. We will allow all 

the witnesses to testify and then we will begin a round of 5-minute 

questions from the Members who are present. 

I am now pleased and honored to introduce the witnesses for today’s hearing. Our first witness is Steven Aitken, who has been the 

Acting Administrator of OMB’s Office of Information and Regulatory Affairs since 2006. Prior to that appointment, Mr. Aitken 

was deputy general counsel at OMB, and before that he was an assistant general counsel at OMB. In total, he has worked at OMB 

for 17 years. Mr. Aitken also was a trial attorney in the civil and 

antitrust divisions of the Department of Justice. Mr. Aitken obtained his bachelor’s degree in government from Harvard College, 

and a law degree from Harvard Law School. We appreciate your 

participation at today’s hearing, Mr. Aitken, and look forward to 

your testimony. 

Our second witness is Sally Katzen. Professor Katzen is presently an adjunct professor and public interest-public service faculty 

fellow at the University of Michigan Law School. Prior to this assignment, she has been a visiting professor and lecturer at various 

other educational institutions. Prior to joining academia, Professor 

20

Katzen served nearly 8 years in the Clinton administration, first 

as the OIRA administrator, then as deputy assistant to the President for economic policy, and deputy director of the National Economic Council in the White House, and finally as the deputy director for management at OMB. Professor Katzen graduated magna 

cum laude from the University of Michigan Law School. Following 

graduation from law school, she clerked for Judge J. Skelly Wright 

of the United States Court of Appeals for the District of Columbia 

circuit. I should also note that Professor Katzen has testified on 

several occasions before this Subcommittee, and has contributed 

her expertise to the Judiciary Committee’s ongoing Administrative 

Law Project, for which we are grateful. Welcome back, Professor 

Katzen. 

Our third witness is Dr. Curtis Copeland, a Specialist in American Government at CRS. Dr. Copeland’s expertise, appropriately 

relevant to today’s hearing, is Federal rulemaking and regulatory 

policy. Dr. Copeland has previously testified before this Subcommittee, and he is one of three CRS experts who are assisting 

the Subcommittee in the conduct of its Administrative Law Project. 

His contributions to the project are deeply appreciated. Prior to 

joining CRS, Dr. Copeland held a variety of positions at the Government Accountability Office over a 23-year period. He received 

his Ph.D. from the University of North Texas. 

Paul Noe is our next witness. Mr. Noe is a partner with C&M 

Capitolink LLC and also provides legal services to clients as counsel in Crowell & Moring’s Environment and Natural Resources 

Group. He works on the policy, legal, political, and technical aspects of regulatory and legislative issues. Mr. Noe earned his undergraduate degree from Williams College and his law degree from 

Georgetown in 1990. 

Our final witness is Professor Peter Strauss. Professor Strauss is 

the Betts Professor of Law at Columbia University School of Law. 

A renowned scholar of administrative law, Professor Strauss has 

taught that subject at Columbia Law School for the past 36 years. 

After obtaining his undergraduate degree from Harvard College, 

Professor Strauss received his law degree from Yale Law School. 

He thereafter clerked for Associate Justice William Brennan and 

Chief Judge David Bazelon of the United States Court of Appeals 

for the District of Columbia. It is an honor to have you with us, 

Professor Strauss. 

At this point, I would like to extend to each of the witnesses my 

warm regards and appreciation for your willingness to participate 

at today’s hearing. Without objection, your written statements will 

be placed into the record. Since you have submitted written statements that will be included in the hearing record, I request that 

you all limit your oral remarks to 5 minutes. You will note that we 

have a lighting system that starts with a green light. After 4 minutes it turns to a yellow light, and then after a minute longer it 

turns to a red light. If you could please finish your testimony by 

the time the red light turns on, I would appreciate that. 

After the witnesses have presented their testimony, the Subcommittee Members will be permitted to ask one round of questions, subject to the 5-minute limit. 

Mr. Aitken, you are invited to now begin your testimony. 

21

TESTIMONY OF STEVEN D. AITKEN, ACTING ADMINISTRATOR, 

OFFICE OF INFORMATION AND REGULATORY AFFAIRS, OFFICE OF MANAGEMENT AND BUDGET 

Mr. AITKEN. Chairman Sa ́nchez, Ranking Member Cannon, 

Chairman Conyers, and distinguished Members of the Subcommittee, thank you for giving me the opportunity to testify before you today on the recently-issued Executive Order 13422. 

A few weeks ago, the OMB Director issued a bulletin for agency 

good guidance practices. On that same day, the President issued 

Executive Order 13422, which amended Executive Order 12866. 

The bulletin and Executive Order share a common good government goal: to improve the way that the Federal Government does 

business by increasing the quality, accountability, and transparency of agency guidance documents, including providing the 

public an opportunity to review and comment on guidance. 

OMB recognizes the enormous value of the guidance documents 

that Federal agencies issue, but as Congress, the Courts, and others have recognized, guidance documents can sometimes have farreaching effects, but they are not always developed, issued, and 

used in a transparent and accountable manner that includes an opportunity for the public to comment on the guidance. 

In order to improve the transparency, public participation, and 

accountability of guidance documents, OMB in 2005 issued for public comment a draft bulletin that identified good guidance practices. 

These practices were based on those already being used by the 

Food and Drug Administration. OMB recently issued the final 

version of that bulletin. 

The good government improvements that are made by the bulletin are reinforced by the recent Executive Order which provides 

for a relatively informal process whereby some, but by no means 

all, of the significant guidance documents that are developed by 

Federal agencies will be submitted to OMB for interagency review. 

The recent Executive Order makes several additional Good Government improvements. There has been some confusion in the 

press and elsewhere about these changes, and I would like to address that. First, concerns have been raised about the Order’s provisions regarding regulatory policy officers. First, these officers are 

not new. When President Clinton issued Executive Order 12866 in 

1993, he directed each agency head to designate a regulatory policy 

officer. 

Second, while the recent Executive Order specifies that these 

regulatory policy officers will be presidential appointees, the case 

is that for most departments and agencies, the regulatory policy officers already are presidential appointees, subject to Senate confirmation. In addition, concerns have been raised that the recent 

Executive Order may require each agency to establish a new regulatory policy office that would be headed by the agency’s regulatory 

policy officer. This reference to an office was a typographical error. 

The reference should have been to an officer. The Executive Order 

will be implemented accordingly. 

In addition, the recent Executive Order increases the transparency of Executive Order 12866 regarding that Order’s discussion of market failure. Before explaining what this amendment 

does do, I would like to explain first what it does not do. 

22

First, the concept of market failure is not new to Executive Order 

12866, but instead has been an integral part of that Order since 

President Clinton issued it in 1993, when he not once, but twice, 

referred in the Order to the ‘‘failures of private markets’’ as a justification for regulatory action. 

Second, the recent Executive Order does not make a market failure the only basis on which a Federal agency can justify regulatory 

action. To the contrary, the recent Order expressly allows agencies 

to identify as a justification for regulatory action any ‘‘other significant problem it intends to address.’’ That is what the Executive 

Order does not do. 

What it does do is to include in the text of Executive Order 

12866 three classic examples of what is a market failure. These examples are not new to the implementation of Executive Order 

12866. In fact, in 1996, the OIRA Administrator issued best practice guidelines for agency use in implementing Executive Order 

12866. The 1996 guidelines included a separate discussion of market failure and the 1996 guidelines discuss the three classic examples of market failure that are referenced in the recent Executive 

Order. 

Some have expressed concern that the recent Order could prevent agencies from issuing regulations to protect public health and 

safety, but this is not correct. Many of the most significant regulations that agencies issue are, in fact, responses to market failures. 

For example, environmental pollution is the classic textbook example of the market failure of externality. In response to this type of 

market failure, this Administration issued the Clean Air Interstate 

Rule, the CAIR rule, which will have major environmental benefits 

by reducing pollution. 

Ms. SA ́ NCHEZ. Mr. Aitken, you hit your time, but if you could just 

summarize briefly. 

Mr. AITKEN. Another type of market failure stems from lack of 

information. In response to this kind of market failure, the Food 

and Drug Administration recently issued regulations that require 

packaged foods to include in their nutritional labeling the amount 

of trans fats that are in the food. This addresses another type of 

market failure. 

This concludes my opening statement. I would welcome any 

questions the Subcommittee has. 

[The prepared statement of Mr. Aitken follows:]

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PREPARED STATEMENT OF STEVEN D. AITKEN


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Ms. SA ́ NCHEZ. I thank the gentleman. 

Ms. Katzen, you are now up. You may proceed with your testimony. 

TESTIMONY OF SALLY KATZEN, PROFESSOR,

UNIVERSITY OF MICHIGAN LAW SCHOOL 

Ms. KATZEN. Thank you. 

Madame Chairman, Mr. Cannon, Mr. Conyers, other distinguished Members, I appreciate very much the opportunity to testify 

today. 

Mr. CONYERS. Mr. Aitken, have you turned your microphone off? 

Ms. KATZEN. Is my time going? 

Ms. SA ́ NCHEZ. We will reset your time. 

Ms. KATZEN. As you mentioned in your introduction, I served as 

the administrator of OIRA for over 5 years during the Clinton administration, and was involved in the drafting and implementation 

of Executive Order 12866. I am a strong proponent of centralized 

review of agency rulemaking, and have often spoken and written 

in defense and support of OIRA. 

I am also a strong proponent of regulations, believing that if 

properly crafted they can improve the quality of our lives, the performance of our economy, and the Nation’s well-being. 

Why, then, am I so critical of this new Executive Order? I have 

prepared written testimony that provides extensive background 

and explanatory information, and would like to use my 5 minutes 

to emphasize the most important points. 

First, during the last 6 years, the Bush administration has taken 

many discrete steps to tighten incrementally, but nonetheless tighten OMB control over the agencies: the information data quality 

guidelines, the peer review guidelines, Circular A-4 for regulatory 

analyses, the risk assessment bulletin, and now the bulletin on 

good guidance practices. Each step, standing on its own, can be justified and none standing on its own is really as bad as the critics 

of the Administration have charged. At the same time, the cumulative effect of all of these is overwhelming the agencies, and there 

is a dramatically different dynamic between the agencies and the 

White House than there was at the end of the Clinton administration. 

In Executive Order 12866, President Clinton continued the practice of centralized review of rulemaking by OIRA, but at the same 

time, he reaffirmed the primacy of the Federal agencies which are 

the repositories of significant experience and expertise, and are the 

entities to which Congress has delegated the authority to issue 

rules with the force and effect of law. Today, those agencies have 

at least one arm tied behind their backs, two 10-pound bricks tied 

to their ankles, and they are set on an obstacle course to navigate 

before they can issue any regulations. Forgive me for mangling my 

metaphors, but the combination of all of the multiple mandates 

that OMB has imposed on the agencies makes it so much more difficult for them to do their jobs. More mandates and no more resources. In fact, the agencies have been straight-lined or decreased. 

Presidential oversight is one thing, but burdening the agencies to 

slow them down or destroy their morale is something else. 

50

Now, I read Mr. Aitken’s written testimony and listened to him 

just now, and it is really very curious. He has not identified any 

problems that they were experiencing under the original Executive 

Order that needed to be fixed. Instead, he has said, again and 

again, that there is nothing new in the Executive Order, that the 

agencies are doing it already. What they are doing is not significant. It is no big deal. By the same token then, why did they do 

it? If it wasn’t intended to accomplish anything, why use the prestige of the President and the status of an Executive Order for a 

non-event? 

Let me also be clear to the extent he says that this is just continuing the logical progression from the Clinton administration, 

that simply is not true. One example is that he cited the 1996 document that I co-authored with Joe Stiglitz that uses the terms 

‘‘market failure’’ and ‘‘externality,’’ et cetera. But that was a document that was called ‘‘Best Practices,’’ not guidance, not bulletin, 

not circular, not Executive Order, and that is a very big difference. 

Finally, if you argue that this is simply to increase transparency 

and good government, then look at the way it was done, without 

any consultation or explanation. Look at the effect on the agencies, 

coming on the heels of all of the other things that OMB has done. 

And look at the message it sends: Regulations to protect the environment and to promote the health and safety of the American people are disfavored—let the market, not the Government, do it. 

Now, Executive Order 12866 as originally drafted was neutral as 

to process, even though President Clinton was highly supportive of 

regulations as part of the solution to serious problems plaguing our 

society. The Executive Order was not skewed to achieve a pro-regulatory result. It was not a codification of a pro-regulatory philosophy or ideology. It was, on its face and by intent, a charter for 

good government without any predetermination of outcomes. 

In light of the actions taken over the last 6 years, that is no 

longer the case with Executive Order 12866 as amended. 

As I noted at the outset, there have been—a lot of these steps 

have been taken. Each one of them has been a thumb on the scale. 

I think by now we have a whole fist influencing the outcome of regulatory decisions. 

Thank you very much for holding this hearing. It is very important, I believe, for Congress to let the Executive know that it takes 

these matters seriously and is concerned about the integrity of the 

Administrative process. 

[The prepared statement of Ms. Katzen follows:]

PREPARED STATEMENT OF SALLY KATZEN

Chairman Sanchez and Members of the Subcommittee. Thank you for inviting me 

to testify today on a subject that is vitally important to the American people. During 

the last six years, there has been a slow but steady change in the process by which 

regulations are developed and issued—specifically, in the balance of authority between the Federal regulatory agencies and the Office of Management and Budget. 

With its most recent actions, the Bush Administration has again restricted agency 

discretion and made it more difficult for them to do the job that Congress has delegated to the Federal agencies. It is therefore important that this Subcommittee consider the reasons for these changes and the implications of these changes for administrative law and regulatory practice. 

I served as the Administrator of the Office of Information and Regulatory Affairs 

(OIRA) at the Office of Management and Budget (OMB) for the first five years of 

the Clinton Administration, then as the Deputy Assistant to the President for EcoVerDate 0ct 09 2002 16:57 Apr 24, 2007 Jkt 000000 PO 00000 Frm 00054 Fmt 6633 Sfmt 6621 F:\WORK\COMM\021307\33312.000 HJUD1 PsN: 33312
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nomic Policy and Deputy Director of the National Economic Council, and then as 

the Deputy Director for Management of OMB. I am a proponent of centralized review of agency rulemaking, and I was personally involved in the drafting and implementation of Executive Order 12866. I have remained active in the area of administrative law generally and rulemaking in particular. Since leaving government service in January 2001, I have taught Administrative Law and related subjects at the 

University of Michigan Law School, George Mason University Law School, and the 

University of Pennsylvania Law School, and I have also taught American Government seminars to undergraduates at Smith College, Johns Hopkins University, and 

the University of Michigan in Washington Program. I frequently speak and have 

written articles for scholarly publications on these issues. 

On January 18, 2007, the Bush Administration released two documents. One was 

expected; the other was not. I can understand why OMB issued a ‘‘Final Bulletin 

for Good Guidance Practices.’’ While I disagree with several of the choices made, I 

recognize that a case can be made that there is a need for such a Bulletin. On the 

other hand, there is no apparent need for Executive Order 13422, further amending 

Executive Order 12866. Regrettably, none of the plausible explanations for its 

issuance is at all convincing. As I will discuss below, there are at least three aspects 

of the new Executive Order that warrant attention: 1) the way it was done—without 

any consultation or explanation; 2) the context in which it was done—coming on the 

heels of OMB’s imposing multiple mandates/requirements on the agencies when 

they are developing regulations; and 3) the effect it will have and the message it 

sends to the agencies—it will be even more difficult for agencies to do their jobs because regulations are disfavored in this Administration. 

To put the most recent Executive Order in perspective, a little history may be 

helpful. The first steps towards centralized review of rulemaking were taken in the 

1970’s by Presidents Nixon, Ford and Carter, each of whom had an ad hoc process 

for selectively reviewing agency rulemakings: President Nixon’s was called the Quality of Life Review; President Ford’s was focused on the agency’s Inflationary Impact 

Analysis that accompanied the proposed regulation; and President Carter’s was 

through the Regulatory Analysis Review Group. Those rulemakings that were considered significant were reviewed by an inter-agency group, which then contributed 

their critiques (often strongly influenced by economists) to the rulemaking record. 

In 1981, President Reagan took a significant additional step in issuing Executive 

Order 12291. That Order formalized a process that called for the review of all Executive Branch agency rulemakings—at the initial and the final stages—under specified standards for approval. The Office that President Reagan chose to conduct the 

review was the Office of Information and Regulatory Affairs (OIRA), established by 

the Congress for other purposes under the Paperwork Reduction Act of 1980. Unless 

OIRA approved the draft notice of proposed rulemaking and the draft final rule, the 

agency could not issue its regulation. 

Executive Order 12291 was highly controversial, provoking three principal complaints. One was that the Executive Order was unabashedly intended to bring about 

regulatory relief—not reform—relief for the business community from the burdens 

of regulation. Second, the Order placed enormous reliance on (and reflected unequivocal faith in) cost/benefit analysis, with an emphasis on the cost side of the 

equation. Third, the process was, by design, not transparent; indeed, the mantra 

was ‘‘leave no fingerprints,’’ with the result that disfavored regulations were sent 

to OMB and disappeared into a big black hole. The critics of Executive Order 12291, 

including Members of Congress, expressed serious and deep concerns about the Executive Order, raising separation of powers arguments, the perceived bias against 

regulations, and the lack of openness and accountability of the process. 

When President Clinton took office and I was confirmed by the Senate as the Administrator of OIRA, my first assignment was to evaluate Executive Order 12291 

in light of the 12 years of experience under Presidents Reagan and Bush, and help 

draft a new Executive Order that would preserve the strengths of the previous Executive Order but correct the flaws that had made the process so controversial. President Clinton would retain centralized review of Executive Branch agency 

rulemakings, but the development and the tone of the Executive Order he would 

sign (Executive order 12866) was to be very different. 

I was told that Executive Order 12291 was drafted in the White House (Boyden 

Gray and Jim Miller take credit for the document) and presented, after President 

Reagan had signed it, as a fait accomplis to the agencies. The protests from the 

agencies were declared moot. We took a different route, consulting and sharing 

drafts with the agencies, public interest groups, industry groups, Congressional 

staffers, and State and local government representatives. When all their comments 

were considered and changes made to the working draft, we again consulted and 

shared our new drafts with all the groups, and again took comments. More changes 

52

were made, and where comments were not accepted, we explained the basis for our 

decisions. 

The tenor of Executive Order 12866 was also quite different from Executive Order 

12291. As noted above, Executive Order 12866 retained centralized review of 

rulemakings, but also reaffirmed the primacy of the agencies to which Congress had 

delegated the authority to regulate. (Preamble) Among other things, Executive 

Order 12866 limited OIRA review to ‘‘significant regulations’’—those with a likely 

substantial effect on the economy, on the environment, on public health or safety, 

etc. or those raising novel policy issues (Section 6(b)(1))—leaving to the agencies the 

responsibility for carrying out the principles of the Executive Order on the vast majority (roughly 85%) of their regulations. 

Executive Order 12866 continued to require agencies to assess the consequences 

of their proposals and to quantify and monetize both the costs and the benefits to 

the extent feasible. (Section 1(a)) But it explicitly recognized that some costs and 

some benefits cannot be quantified or monetized but are ‘‘nevertheless essential to 

consider.’’ (Section 1(a)) I believe it was Einstein who had a sign in his office at 

Princeton to the effect that ‘‘not everything that can be counted counts, and not everything that counts can be counted.’’

While Executive Order 12292 required agencies to set their regulatory priorities 

‘‘taking into account the conditions of the particular industries affected by the regulations [and] the condition of the national economy’’ (Section 2 (e)), Executive Order 

12866 instructed agencies to consider ‘‘the degree and nature of the risks posed by 

various substances and activities within its jurisdiction’’ (Section 1(b)(4)), and it 

added to the list of relevant considerations for determining if a proposed regulation 

qualified as ‘‘significant’’ not only an adverse effect on the economy or a sector of 

the economy, but also ‘‘productivity, competition, jobs, the environment, public 

health or safety or State, local, or tribal governments or communities.’’ (Section 3(f)) 

There were other significant differences between Executive Order 12291 and Executive Order 12866, including those relating to the timeliness of review and the 

transparency of the process, but for present purposes, the key to the difference was 

that President Clinton was focused on a process for better decision-making and 

hence better decisions and not a codification of a regulatory philosophy or ideology. 

Centralized review was seen as a valid exercise of presidential authority, facilitating 

political accountability (the President takes the credit and gets the blame for what 

his agencies decide) and to enhance regulatory efficacy (that is, decisions that take 

into account the multitude of disciplines and the multitude of perspectives that can 

and should be brought to bear in solving problems in our complex and interdependent society). But whatever one’s view of centralized review of agency 

rulemakings, Executive Order 12866 was—on its face and by intent—a charter for 

good government, without any predetermination of outcomes. 

The neutrality of the process was essential. President Clinton viewed regulations 

as perhaps the ‘‘single most critical . . . vehicle to achieve his domestic policy goals’’ 

(Kagan, 114 Harv. L. Rev 2245, 2281–82 ((2001)), and he spoke often of the salutary 

effects of regulations on the Nation’s quality of life and how regulations were part 

of the solution to perceived problems. But the Executive Order was not skewed to 

achieve a pro-regulatory result. The regulations would be debated on their merits, 

not preordained by the process through which they were developed and issued. 

When George W. Bush became President in January 2001, his philosophy was decidedly anti-regulatory. I know that his advisors considered whether to change Executive Order 12866 and they concluded that it was not necessary to accomplish their 

agenda. Indeed, President Bush’s OMB Director instructed the agencies to scrupulously adhere to the principles and procedures of Executive Order 12866 and its 

implementing guidelines. (OMB M–01–23, June 19, 2001) The only changes to the 

Executive Order came two years into President Bush’s first term, and the changes 

were limited to transferring the roles assigned to the Vice President to the Chief 

of Staff or the OMB Director. (Executive Order 13258) 

Almost five years later, President Bush signed Executive Order 13422, further 

amending Executive Order 12866. So far as I am aware, there was no consultation 

and no explanation of the problems under the existing Executive Order that prompted these amendments, or whether the amendments would have a salutary effect on 

whatever problems existed, or whether the amendments would have unintended 

consequences that should be considered. Press statements issued after the fact do 

not make for good government. 

Second, the new Executive Order comes in the course of a steady and unwavering 

effort to consolidate authority in OMB and further restrict agency autonomy and 

discretion. On February 22, 2002, OMB issued its Information Quality Act (IQA) 

Guidelines. (67 Fed. Reg. 8452). The IQA itself was three paragraphs attached to 

a more than 700-page Treasury and General Government Appropriations Act for 

53

Fiscal Year 2001, with no hearings, no floor debate and no committee reports. Its 

objective was ‘‘to ensure the quality, objectivity, utility and integrity of information 

disseminated to the public.’’ OMB took up the assignment with a vigor and determination that was remarkable. OMB’s government-wide guidelines created a new 

construct: now, there would be ‘‘information’’ and ‘‘influential information’’ and different (more stringent standards) would apply to the higher tiers. OMB also required the agencies to issues their own guidelines (subject to OMB approval); establish administrative mechanisms allowing people or entities to seek the correction of 

information they believe does not comply with these guidelines; and report periodically to OMB on the number and nature of these complaints. The U.S. Chamber of 

Commerce thought this ‘‘would have a revolutionary impact on the regulatory process’’—keeping the agencies from relying on data that industry thought was questionable. 

Then came OMB’s Proposed Draft Peer Review Standards for Regulatory Science 

(August. 29, 2003), in which OMB attempted to establish uniform government-wide 

standards for peer review of scientific information used in the regulatory process. 

Peer review is generally considered the gold standard for scientists. Yet leading scientific organizations were highly critical of what OMB was trying to do and how 

it was doing it, and they were joined by citizen advocacy groups and former government officials. They argued that the proposed standards were unduly prescriptive, 

unbalanced (in favor of industry), and introduced a new layer of OMB review of scientific or technical studies used in developing regulations. The reaction was so 

strong and so adverse that OMB substantially revised its draft Bulletin to make it 

appreciably less prescriptive and restrictive, and in fact OMB resubmitted it in draft 

form for further comments before finalizing the revised Bulletin. 

On March 2, 2004, OMB replaced a 1996 ‘‘best practices’’ memorandum with Circular A–4, setting forth instructions for the Federal agencies to follow in developing 

the regulatory analyses that accompany significant draft notices of proposed rulemaking and draft final rules. The Circular, almost 50-pages single spaced, includes 

a detailed discussion of the dos and don’ts of virtually every aspect of the documentation that is needed to justify a regulatory proposal. While the term ‘‘guidance’’ 

is used, agencies that depart from the terms of the Circular do so at their peril (or 

more precisely, at the peril of their regulatory proposal). 

Then came the OMB Proposed Risk Assessment Bulletin (January 9, 2006), providing technical guidance for risk assessments produced by the Federal government. 

There were six standards specified for all risk assessments and a seventh standard, 

consisting of five parts, for risk assessments related to regulatory analysis. In addition, using the terminology from the IQA Guidance, OMB laid out special standards 

for ‘‘Influential Risk Assessments’’ relating to reproducibility, comparisons with 

other results, presentation of numerical estimates, characterizing uncertainty, characterizing results, characterizing variability, characterizing human health effects, 

discussing scientific literature and addressing significant comments. Agency comments raised a number of very specific problems and such general concerns as that 

OMB was inappropriately intervening into the scientific underpinnings of regulatory 

proposals. OMB asked the National Academies of Scientists (NAS) to comment on 

the draft Bulletin. The NAS panel (on which I served) found the Bulletin ‘‘fundamentally flawed’’ and recommended that it be withdrawn. 

Then, on January 18, 2007, OMB issued its final Bulletin on ‘‘Agency Good Guidance Practices.’’ Agencies are increasingly using guidance documents to inform the 

public and to provide direction to their staff regarding agency policy on the interpretation or enforcement of their regulations. While guidance documents—by definition—do not have the force and effect of law, this trend has sparked concern by commentators, including scholars and the courts. In response, the Bulletin sets forth the 

policies and procedures agencies must follow for the ‘‘development, issuance, and 

use’’ of such documents. It calls for internal agency review and increased public participation—all to the good. In addition, however, the Bulletin also imposes specified 

‘‘standard elements’’ for significant guidance documents; provides instructions as to 

the organization of agency websites containing significant guidance documents; requires agencies to develop procedures (and designate an agency official/office) so 

that the public can complain about significant guidance documents and seek their 

modification or rescission; and extends OIRA review to include significant guidance 

documents. I do not believe it is an overstatement to say that the effect of the Bulletin is to convert significant guidance documents into legislative rules, subject to 

all the requirements of Section 553 of the Administrative Procedure Act, even 

though the terms of that Section explicitly exempt guidance documents from its 

scope. To the extent that the Bulletin makes the issuance of guidance documents 

much more burdensome and time consuming for the agencies, it will undoubtedly 

result in a decrease of their use. That may well have unintended unfortunate conVerDate 0ct 09 2002 16:57 Apr 24, 2007 Jkt 000000 PO 00000 Frm 00057 Fmt 6633 Sfmt 6621 F:\WORK\COMM\021307\33312.000 HJUD1 PsN: 33312
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sequences, because regulated entities often ask for and appreciate receiving clarification of their responsibilities under the law, as well as protection from haphazard 

enforcement of the law, by agency staff. 

This is quite a record. While each step can be justified as helping to produce better regulatory decisions, the cumulative effect is overwhelming. Requirements are 

piled on requirements, which are piled on requirements that the agencies must satisfy before they can issue regulations (and now, significant guidance documents) 

that Congress authorized (indeed, often instructed) them to issue. And OMB has not 

requested, nor has the Congress in recent years appropriated, additional resources 

for the agencies to carry out OMB’s ever increasing demands. As agencies must do 

more with less, the result is that fewer regulations can be issued—which is exactly 

what the business community has been calling on this Administration to do. 

It is in this context that Executive Order 13422, further amending Executive 

Order 12866, is released. Until the Bulletin on guidance documents, OIRA extended 

its influence throughout the Executive Branch without any amendments to Executive Order 12866. As discussed above, OMB issued Circulars and Bulletins covering 

a wide variety of subjects, virtually all of which were quite prescriptive (and often 

quite burdensome) in nature. OMB Circulars and Bulletins do not have the same 

status as an Executive Order, but they are treated as if they did by the Federal 

agencies. Why then did OMB draft and the President sign Executive Order 13422? 

One indication of a possible answer is that while Executive Order 13422 in effect 

codifies the Bulletin on guidance documents, it does not pick up and codify the earlier pronouncements on data quality, peer review, regulatory impact analyses, or 

even risk assessment principles. It may be that it was thought necessary to amend 

Executive Order 12866 for guidance documents because Executive Order 12866 was 

written to apply only where the agencies undertook regulatory actions that had the 

force and effect of law. But it is unlikely that the agencies would balk at submitting 

significant guidance documents to OIRA if there were an OMB Bulletin instructing 

them to do so, and since neither Executive Orders nor Circulars or Bulletins are 

judicially reviewable, it is also unlikely that anyone could successfully challenge in 

court an agency’s decision to submit a significant guidance document to OIRA. 

Perhaps more revealing of the reason(s) for Executive Order 13422 is that it is 

not limited to guidance documents. Consider the other amendments included in the 

new Executive Order. First, Executive Order 12866 had established as the first 

principle of regulation that:

Each agency shall identify the problem that it intends to address (including, 

where applicable, the failure of private markets or public institutions that warrant new agency action) as well as assess the significance of that problem’’

Executive Order 13422 amends Executive Order 12866 to state instead:

Each agency shall identify in writing the specific market failure (such as 

externalities, market power, lack of information) or other specific problem that 

it intends to address (including, where applicable, the failures of public institutions) that warrant new agency action, as well as assess the significance of that 

problem, to enable assessment of whether any new regulation is warranted.

By giving special emphasis to market failures as the source of a problem warranting 

a new regulation, the Administration is saying that not all problems are equally deserving of attention; those caused by market failures are in a favored class and possibly the only class warranting new regulations. This could be read as a throw back 

to the ‘‘market-can-cure-almost-anything’’ approach, which is the litany of opponents 

of regulation; in fact, history has proven them wrong—there are many areas of our 

society where there are serious social or economic problems—e.g., civil rights—that 

are not caused by market failures and that can be ameliorated by regulation. 

Second, the new Executive Order amends Section 4 of Executive Order 12866, 

which relates to the regulatory planning process and specifically references the Unified Regulatory Agenda prepared annually to inform the public about the various 

proposals under consideration at the agencies. The original Executive Order instructed each agency to also prepare a Regulatory Plan that identifies the most important regulatory actions that the agency reasonably expects to issue in proposed 

or final form in that fiscal year. Section 4, unlike the rest of the Executive Order, 

applies not only to Executive Branch agencies, but also to independent regulatory 

commissions, such as the Securities and Exchange Commission, the Federal Communications Commission, the Federal Trade Commission, and the Federal Reserve 

Board. It is not without significance that the new Executive Order uses Section 4 

to impose an additional restraint on the agencies:

55

Unless specifically authorized by the head of the agency, no rulemaking shall 

commence nor be included on the Plan without the approval of the agency’s 

Regulatory Policy Office...

This language should be read in conjunction with an amendment to Section 6(a)(2) 

that specifies that the agency’s Regulatory Policy Officer must be ‘‘one of the agency’s Presidential Appointees.’’ Executive Order 12866 had provided that the agency 

head was to designate the agency’s Regulatory Policy Officer, with the only condition that the designee was to report to the agency head. The original Executive 

Order further provided that the Regulatory Policy Officer was to ‘‘be involved at 

every stage of the regulatory process . . .’’—in other words, a hands-on job. Now, 

there is an explicit politicalization of the process; a ‘‘sign-off,’’ not a hands-on, assignment; and, most significantly, no accountability. The newly appointed officer is 

not required to be subject to Senate confirmation, nor is the person required to report to a Senate-confirmed appointee. 

The other changes to Section 4 are also troubling. As amended, the agencies must 

now include with the Regulatory Plan the:

agency’s best estimate of the combined aggregate costs and benefits of all its 

regulations planned for that calendar year...

Very few would dispute that the Regulatory Plan has been notoriously unreliable 

as an indicator of what an agency is likely to accomplish in any given time frame; 

it is not unusual for regulations that are not included in the Plan to be issued 

should circumstances warrant, nor is it unusual for regulations included in the Plan 

with specific dates for various milestones to languish year after year without getting 

any closer to final form. 

In any event, the requirement to aggregate the costs and benefits of all the regulations included in the Plan for that year is very curious. We know that costs and 

benefits can be estimated (at least within a range) at the notice stage because the 

agency will have settled on one or more options for its proposal. But to try to estimate either costs or benefits at the notice of inquiry stage or before the agency has 

made even tentative decisions is like trying to price a new house before there is 

even an option on the land and before there are any architect’s plans. The numbers 

may be interesting, but hardly realistic, and to aggregate such numbers would likely 

do little to inform the public but could do much to inflame the opponents of regulation. This would not be the first time that large numbers that have virtually no relation to reality have driven the debate on regulation—e.g., the $1.1 trillion estimate 

of the annual costs of regulations that is frequently cited by opponents of regulation, 

even though every objective critique of the study that produced that number concludes that it not only overstates, but in fact grossly distorts, the truth about the 

costs of regulation. The only other plausible explanation for this amendment to the 

Executive Order it that it is the first step toward implementing a regulatory budget. 

In my view, the concept of a regulatory budget is deeply flawed, but it should be 

debated on the merits and not come in through the back door of an Executive Order 

designed for other purposes. 

There is also a gratuitous poke at the agencies in the amendment to Section 4(C). 

The original Executive Order instructed the agencies to provide a ‘‘summary of the 

legal basis’’ for each action in the Regulatory Plan, ‘‘including whether any aspect 

of the action is required by statute or court order.’’ The new amendment adds to 

the previous language the clause, ‘‘and specific citation to such statute, order or 

other legal authority.’’ It may appear to be trivial to add this requirement, but by 

the same token, why is it necessary to impose such a requirement? 

As noted above, I am not aware of any consultation about either the merits of any 

of the amendments or the perception that may attach to the cumulative effect of 

those amendments. Therefore, I do not know whether the agencies have, for example, been proposing regulations based on problems caused by something other than 

market failure which OMB does not consider an appropriate basis for a regulation; 

whether senior civil servants at the agencies have been sending proposed regulations to OMB that run contrary to the wishes of the political appointees at those 

agencies; or whether agencies have been misrepresenting what applicable statutes 

or court orders require. 

If not, then there is little, if any, need for these amendments, other than to send 

a signal that the bar to issuing regulations is being raised; that OMB is deciding 

the rules of the road; and that those rules are cast so as to increase the I’s that 

must be dotted and the T’s that must be crossed. In other words, the message is 

that agencies should not be doing the job that Congress has delegated to them. This 

is not a neutral process. If the Bush Administration does not like some or all agency 

proposed regulations, they can debate them on the merits. But the Executive Order 

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should not become a codification of an anti-regulatory manifesto. This is not good 

government.

Ms. SA ́ NCHEZ. Thank you for your testimony, Professor Katzen. 

Now we move to Dr. Copeland. 

TESTIMONY OF CURTIS W. COPELAND, Ph.D., SPECIALIST IN 

AMERICAN NATIONAL GOVERNMENT, CONGRESSIONAL RESEARCH SERVICE 

Mr. COPELAND. Thank you very much. 

Madame Chairman, Members of the Subcommittee, I am pleased 

to be here today to discuss the changes made by Executive Order 

13422. These changes are the most significant to the regulatory review process since 1993, and as you mentioned, can be viewed as 

part of a broader assertion of presidential authority throughout the 

Bush administration. 

The most consistent attribute of these changes is their lack of 

clarity. Specifically, it is unclear why the changes were made, their 

effect on agencies and the public, and their effect on the balance 

of power between the President and Congress. My bottom line is 

that because of this lack of clarity, the ultimate effects of these 

changes are likely to become apparent only through their implementation. 

Ironically, although the Executive Order now requires agencies 

to identify the specific market failure or problem that prompted the 

issuance of the rules, the Bush administration has not indicated 

why the changes made by the Order are needed. For example, why 

did the President conclude that agencies regulatory policy officers 

now must be presidential appointees? Why do those policy officers 

no longer report to the agency head, and why was their authority 

to control agency’s regulatory planning and rulemaking activity significantly enhanced? Sound public policy reasons can be envisioned 

for many of these changes, and enunciation of those reasons might 

have prevented much of the ensuing controversy. 

In some cases, the lack of clarity about the effects of the Executive Order is because of the broad discretion that is provided to 

both the agencies and OMB. For example, agencies are now required to estimate the aggregate cost and benefits of upcoming 

rules ‘‘to the extent possible’’ and are required to identify specific 

market failure or problem before issuing a rule where applicable, 

but it is unclear who decides what is possible or applicable. Is it 

the agencies or OMB? 

In other cases, the effects of the changes are unclear because, at 

least on the surface, they don’t appear to change existing practices. 

For example, as Mr. Aitken just mentioned, regulatory officers are 

already presidential appointees in most agencies—most major 

agencies. Therefore, the Order seems to require what is already 

being done. However, if OMB or the President requires agencies to 

designate different presidential appointees to this position, then 

this mandate could become much more significant, particularly 

when coupled with the newly enhanced authority of those officers 

to control agencies’ regulatory planning and output. 

Similarly, one might think that agencies could satisfy the requirement that they estimate the aggregate cost and benefits of 

their plan rules simply by adding up the rules individual estimates; 

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however, agencies’ regulatory plans rarely contain quantitative estimates of cost and benefit, in many cases because the rules are 

still under development and a year away from publication. Therefore, if agencies are held strictly to this requirement, developing 

aggregate cost and benefit estimates could be proved difficult for 

the agencies and of questionable validity. 

Other requirements in the Order seem to have broad or unclear 

scope. For example, it requires agencies to notify OMB about significant guidance documents, and defines a guidance document in 

such a way that it may cover even oral statements by agency staff. 

Also, as many others have pointed out, it is not clear how a nonbinding guidance document can be expected to have the kinds of 

significant effects described in the Order; that is, $100 million impact on the economy. As a result, agencies may conclude that none 

of their guidance documents meet the Executive Order’s requirements for OMB notification. On the other hand, because OMB is 

also given the authority to determine which documents are significant, the scope and impact of this requirement may be as broad as 

OMB determines it needs to be. 

It is also unclear whether the time limits and transparency requirements applicable to rules will apply to guidance documents. 

For example, will OMB have to complete its review of guidance 

documents within 90 days? Will agencies have to disclose the 

changes made to their guidance documents at the suggestion and 

recommendation of OMB? 

Finally, it is unclear what impact the changes brought about by 

the Executive Order will have on the balance of power between the 

President and Congress. As I mentioned earlier, the Order requires 

agency regulatory policy officers to be presidential appointees, but 

does not indicate whether they should be subject to Senate confirmation. One could argue that it is the role of Congress to prescribe in law whether the regulatory policy officer position should 

be subject to Senate confirmation. Even if an agency had designated a person in a Senate-confirmed position as an agency’s regulatory policy officer, one could argue that this person would have 

to undergo another confirmation process because the scope of the 

person’s responsibilities had changed significantly. 

Also, it is not clear whether the Orders and requirements regarding policy officers now applies to independent regulatory agencies 

that had previously been exempt from this requirement, and that 

Congress establish more—and that Congress establishd to be more 

removed from presidential influence. If so, this would represent a 

clear departure from previous practice. 

That concludes my prepared statement. I would be happy to answer any questions. 

[The prepared statement of Dr. Copeland follows:]

PREPARED STATEMENT OF CURTIS W. COPELAND

Madam Chairman and Members of the Subcommittee: 

I am pleased to be here today to discuss the changes made to the Office of Management and Budget’s (OMB) regulatory review process as a result of Executive 

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1 Executive Order 13422, ‘‘Further Amendment to Executive Order 12866 on Regulatory Planning and Review,’’ 72 Federal Register 2763, Jan. 23, 2007. Five years earlier, E.O. 13258 reassigned certain responsibilities from the Vice President to the President’s chief of staff, but otherwise did not change the OIRA review process. See Executive Order 13258, ‘‘Amending Executive 

Order 12866 on Regulatory Planning and Review,’’ 67 Federal Register 9385, Feb. 28, 2002. 2 Executive Order 12866, ‘‘Regulatory Planning and Review,’’ 58 Federal Register 51735, Oct. 

4, 1993. 3Public Citizen, ‘‘New Executive Order Is Latest White House Power Grab,’’ available at 

[http://www.citizen.org/pressroom/release.cfm?ID=2361]. 4 Attributed to William Kovacs, Vice President of Environment, Energy, and Regulatory Affairs, U.S. Chamber of Commerce, in John Sullivan, ‘‘White House Sets Out New Requirements 

for Agencies Developing Rules, Guidance,’’ Daily Report for Executives, Jan. 19, 2007, p. A–31. 5 CRS Report RL33862, Changes to the OMB Regulatory Review Process by Executive Order 

13422, by Curtis W. Copeland. 6Personal conversation with OMB staff, Feb. 8, 2007. 

7 As originally written, Executive Order 12866 required the regulatory policy officers to report 

to the agency heads; Executive Order 13422 eliminated that language when it required that the 

officers be presidential appointees. 8 Unless specifically authorized by the agency head, the presidential policy officer must approve the listing of all significant forthcoming regulatory actions in the regulatory plan and approve the initiation of all rulemaking actions. Previously, only the agency head could approve 

the regulatory plan, and there was no language in the order prohibiting rulemaking in the absence of the regulatory policy officer’s approval. 

Order 13422, issued by President George W. Bush on January 18, 2007.1 The executive order amended the review process that was established by Executive Order 

12866 and is implemented by OMB’s Office of Information and Regulatory Affairs 

(OIRA).2 The changes are the most significant changes to that process since it was 

established in 1993. The changes are also controversial, with some characterizing 

the new executive order as a ‘‘power grab’’ by the White House that undermines 

public protections and lessens congressional authority,3 and others describing it as 

‘‘a paragon of common sense and good government.’’ 4 However, both supporters and 

critics of the new order agree that it represents an expansion of presidential authority over rulemaking agencies. In that regard, Executive Order 13422 can be viewed 

as part of a broader statement of presidential authority that has been presented 

throughout the Bush Administration. 

The most important changes made by the executive order appear to fall into five 

general categories: (1) a requirement that covered agencies identify in writing the 

specific ‘‘market failure’’ or ‘‘problem’’ that warrants the issuance of a new regulation, (2) a requirement that each agency head designate a presidential appointee 

within the agency as a ‘‘regulatory policy officer’’ who can largely control upcoming 

rulemaking activity in that agency, (3) a requirement that agencies provide their 

best estimates of the aggregate regulatory costs and benefits of rules they expect 

to publish in the coming year, (4) an expansion of OIRA review to include agencies’ 

significant guidance documents, and (5) a provision permitting agencies to consider 

whether to use more formal rulemaking procedures in certain cases. 

I have provided the Subcommittee with copies of a recent CRS report that describes each of these changes in some detail and notes what observers in the public, 

private, and nonprofit sectors have said about them.5 Rather than reiterate what 

is in that report, my testimony today focuses on what is unknown or unclear about 

changes brought about by Executive Order 13422—specifically, (1) why the changes 

were made, (2) the effect of the changes on federal rulemaking agencies and the 

public, and (3) the effect of the changes on the balance of power between the President and Congress with regard to regulatory agencies. OMB recently indicated that 

it planned to issue clarifying ‘‘implementation assistance’’ to the agencies, which 

may answer many, if not all, of these questions.6

WHY THE CHANGES WERE MADE

Executive Order 13422 does not indicate, and the Bush Administration has not 

explained (except in very general terms), why changes to Executive Order 12866 

were needed at this time. For example, it is not clear why the President believed 

that federal agencies’ regulatory policy officers should be required to be presidential 

appointees, why those policy officers should no longer report to the agency head,7

or why their authority to control their agencies’ regulatory planning and rulemaking 

activities should be significantly enhanced.8 Likewise, the Administration has not 

explained why the new executive order requires agencies to provide aggregate estimates of regulatory costs and benefits for all of the agencies’ upcoming regulations. 

The rationale behind the expansion of OIRA’s regulatory review to include agencies’ 

significant guidance documents can be inferred, at least to some extent, by reading 

OMB’s ‘‘Final Bulletin for Agency Good Guidance Practices’’ that was issued the 

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9Office of Management and Budget, ‘‘Final Bulletin for Agency Good Guidance Practices,’’ 72 

Federal Register 3432, Jan. 25, 2007. To view a copy of this bulletin, see [http://

www.whitehouse.gov/omb/memoranda/fy2007/m07-07.pdf]. 10For example, see David McNaughton, ‘‘Reverse Regulation: With Another Nonsense Order, 

President Bush Quashes Legitimate Rule-making by Inserting Political Overseer,’’ Atlanta Journal-Constitution, Feb. 2, 2007, p. A10, which cited Emory University Law Professor William 

Buzbee as saying that this provision ‘‘makes it even more likely that regulatory decisions will 

be made by someone more sympathetic to political pressure and ideology than to the federal 

agency’s legal duty.’’ On the other hand, see Jim Wooten, ‘‘Vouchers, Transit Alert, Sen. 

Obama,’’ Atlanta Journal-Constitution, Feb. 2, 2007, p. A11, which approved of this provision 

and said ‘‘There’s nothing radical about applying cost-benefit analysis to proposed laws and regulations.’’

same day as the executive order.9 Nevertheless, it is not clear why the Administration believed that both the OMB bulletin and the changes to the executive order 

were necessary. 

Neither the President nor OMB is required to explain why executive orders are 

issued, or why existing OIRA review processes are changed. And sound public policy 

rationales can be envisioned concerning why the changes were made. Nevertheless, 

it is notable that, while OMB has required agencies to provide the ‘‘specific market 

failure’’ or the ‘‘specific problem’’ that led to the development of draft regulations, 

the Administration has not provided similarly specific reasons why these five 

changes to the review process for all significant rules and guidance documents were 

made. Providing those rationales might have gone a long way toward quieting some 

of the concerns that have been voiced regarding the changes. 

EFFECT OF THE CHANGES ON AGENCIES AND THE PUBLIC

Also unclear is the ultimate effect of the changes brought about by Executive 

Order 13422 in terms of the burden that they may impose on federal rulemaking 

agencies, the rules that emerge from the rulemaking process, and the transparency 

of that process to the public. In some cases, this lack of clarity is because of the 

discretion given to agencies or OIRA in the review process. For example, the requirement in the new executive order that agencies estimate the aggregate costs 

and benefits of upcoming rules listed in their regulatory plans is required ‘‘to the 

extent possible.’’ It is not clear whether agencies or OIRA will ultimately determine 

what is ‘‘possible.’’

Similarly, the requirement in the ‘‘Principles of Regulation’’ section of the new executive order that each covered agency identify in writing the ‘‘specific market failure’’ or the ‘‘specific problem’’ that it intends to address through a draft regulation 

is preceded by language indicating that this principle should be followed ‘‘to the extent permitted by law and where applicable.’’ It is unclear whether OIRA will permit agencies to decide when the requirement is ‘‘applicable,’’ or whether OIRA will 

make that determination for them. Also unclear is how strictly OIRA will enforce 

this principle. For example, will OIRA consider a statutory requirement that an 

agency develop a final rule by a particular date a ‘‘specific problem’’ that permits 

rulemaking to go forward? Finally, although the new executive order requires agencies to make this ‘‘market failure’’ or ‘‘problem’’ determination in writing, it does not 

indicate whether this written determination should be made public. Conceivably, 

therefore, agencies could satisfy this requirement by preparing a written determination of the need for a rule without showing it to anyone outside government. 

In other cases, the effect of the changes made by Executive Order 13422 are unclear because they do not appear (at least on the surface) to change existing practices. For example, although Executive Order 12866 previously required agency 

heads to designate regulatory policy officers who reported to them, the new executive order requires each agency head to designate one of the agency’s presidential 

appointees to that position—a requirement that has stirred considerable controversy.10 However, available evidence indicates that most agency regulatory policy 

officers are already presidential appointees (e.g., agency general counsels), so it appears that the order simply requires what most agencies are already doing. Likewise, the new executive order states that ‘‘each agency may also consider whether 

to utilize formal rulemaking procedures under 5 U.S.C. 556 and 557 for the resolution of complex determinations.’’ However, agencies have always been able to use 

formal rulemaking procedures, although they almost always elect not to do so because those formal, trial-like processes are generally considered more time-consuming, cumbersome, and expensive than informal ‘‘notice and comment’’ rulemaking. Therefore, the new order seems to provide discretion where discretion is already allowed (but generally not used). 

These provisions, however, may be more substantive than they initially appear. 

For example, the new executive order says agencies may consider whether to use 

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11 John Sullivan, ‘‘White House Sets Out New Requirements for Agencies Developing Rules, 

Guidance,’’ citing Paul Noe, partner at C&M Capitolink, who was a counselor to former OIRA 

Administrator John Graham. 

formal rulemaking procedures ‘‘in consultation with OIRA.’’ If OIRA is able to persuade agencies during those consultations to use formal procedures more frequently, 

then the impact of this provision on the agencies may, in fact, be considerable. Also, 

use of formal rulemaking procedures would not permit the same type of public participation that are the hallmark of informal ‘‘notice and comment’’ rulemaking. By 

the same measure, if OIRA or the President requires agencies to designate new or 

different presidential appointees within the agencies as regulatory policy officers, 

then this provision—particularly when coupled with the newly enhanced authority 

of regulatory policy officers to control regulatory output—could become much more 

important. 

The potential effects of other requirements in the new executive order are unclear 

because of the way existing procedures operate. For example, as originally issued 

in 1993, Executive Order 12866 required covered agencies, as part of the regulatory 

planning process, to provide preliminary estimates of the anticipated costs and benefits of each planned significant regulatory action. The new executive order adds the 

requirement that each agency provide its best estimate of the ‘‘combined aggregate 

costs and benefits of all its regulations planned for that calendar year.’’ At first impression, an agency could satisfy this requirement by simply tallying up the estimates for each forthcoming rule listed in the agency’s plan. However, agencies’ regulatory plans rarely contain quantitative estimates for forthcoming rules (especially 

for forthcoming proposed rules that may not be issued for as much as a year), instead either narratively describing in general terms the expected results of the regulatory action or simply indicating that such estimates are ‘‘to be determined.’’ Also, 

agencies’ regulatory plans are supposed to reflect rules that are expected to be 

issued during the upcoming fiscal year, so the requirement that agencies develop 

estimates of aggregate costs and benefits on a calendar year basis seems inconsistent with existing practices. 

Other requirements in Executive Order 13422 seem to have an indefinite scope, 

making their effect on agencies and the benefits they may provide to the public difficult to determine. For example, the new order requires agencies to provide OIRA 

with ‘‘advance notification of any significant guidance documents.’’ The order (particularly when amplified by the OMB final bulletin on good guidance practices) defines a ‘‘guidance document’’ in such a way that it covers not only written material, 

but also video tapes, web-based software, and even oral statements by agency staff 

if they are of ‘‘general applicability and future effect.’’ The order defines a ‘‘significant’’ guidance document as one that, among other things, ‘‘may reasonably be anticipated’’ to, among other things, ‘‘lead to an annual effect of $100 million or more’’ 

or ‘‘materially alter the budgetary impact’’ of entitlements, grants, loans, and user 

fees. However, by definition, guidance documents cannot have a binding effect on 

the public (if they did, they would have to be rules subject to ‘‘notice and comment’’ 

and other requirements), so it is not clear how guidance can be expected to have 

the effects delineated in the definition. As a result, agencies may conclude that none 

of their guidance documents meet the executive order’s requirements for OIRA notification. On the other hand, because OIRA is given the authority to determine which 

documents are ‘‘significant,’’ the scope and impact of this requirement may be as 

broad as OIRA determines that it needs to be. 

Supporters of the expansion of presidential review to significant guidance documents have said the change will standardize and make more transparent the process by which federal agencies develop, issue, and use guidance documents.11 Executive Order 12866 contains provisions that provide a measure of transparency to the 

rulemaking process, requiring (among other things) that agencies disclose to the 

public the changes made to their rules at the suggestion or recommendation of 

OIRA, and that OIRA disclose the rules that are under review at OIRA. The executive order also requires that OIRA complete its reviews of draft rules within 90 

days. However, it is unclear whether these transparency and time-limit provisions 

will apply to agency guidance documents, because Executive Order 13422 did not 

change those sections of Executive Order 12866. If these provisions do not apply, 

then agencies may submit guidance to OIRA for review and the public may never 

know that OIRA is reviewing them, for how long, or what changes were made at 

OIRA’s direction. If the provisions are deemed applicable to guidance documents, 

then the goals of improved transparency and standardization would appear to be 

supported. 

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12For example, Section 109(b)(1) of the Clean Air Act (42 U.S.C. § 7409(b)(1)) instructs the 

Environmental Protection Agency to set primary ambient air quality standards ‘‘the attainment 

and maintenance of which . . . are requisite to protect the public health’’ with ‘‘an adequate 

margin of safety.’’ 13 U.S. Congress, House Committee on Government Reform, United States Government Policy 

and Supporting Positions, Nov. 22, 2004. For example, the Department of Transportation had 

32 positions subject to presidential appointment with Senate confirmation (PAS positions) in 

2004, but none without Senate confirmation (PA positions). The Environmental Protection Agency had 14 PAS positions, but no PA positions; the Department of Labor had 19 PAS positions, 

but no PA positions. On the other hand, the Department of Homeland Security had 18 PAS positions, but also had six PA positions. 

EFFECT ON BALANCE OF POWER

Finally, in a larger, constitutional sense, it is unclear what impact the changes 

brought about by Executive Order 13422 will have on the balance of power between 

the President and Congress in this area. Congress has a vested interest in the regulations that emerge from the rulemaking process. Congress created each regulatory 

agency and enacted the legislation underpinning each proposed and final rule. Congress may also establish the criteria under which federal agencies can issue rules. 

For example, some statutes direct agencies to establish regulations based solely on 

what is required to protect human health, and may require agencies to regulate 

with a margin of safety.12 Therefore, presidentially initiated changes that may affect 

these congressional directives, such as the requirement that each agency identify a 

specific ‘‘market failure’’ or ‘‘problem’’ before issuing a rule, are naturally of potential interest to Congress. 

Another area of potential congressional interest involves the requirement that 

agency regulatory policy officers be presidential appointees. Executive Order 13422 

does not indicate whether these appointees should be subject to Senate confirmation. Senate confirmation of presidential appointees is generally considered a way 

to strengthen congressional influence over agency decision making, because (among 

other things) nominees often agree during the confirmation process to appear subsequently before relevant congressional committees. The most recent ‘‘Plum Book’’ indicates that virtually all presidential appointees in regulatory agencies are subject 

to Senate confirmation.13 In some agencies (such as the Environmental Protection 

Agency, the Department of Transportation, and the Department of Labor), all presidential appointee positions are Senate confirmed (unless one counts noncareer senior executives, who are appointed by agency heads subject to White House approval). Therefore, it appears that most officials designated as regulatory policy officers will be (or will already have been) subject to Senate confirmation. 

In those agencies with presidential appointees who are not Senate confirmed, one 

could argue that it is the role of Congress to prescribe, in law, whether the regulatory policy officer position should be subject to Senate confirmation. To take this 

argument further, even if an agency head designated a person in a Senate-confirmed position as the agency’s regulatory policy officer, one could argue that this 

person would have to undergo another confirmation process because the scope of the 

person’s responsibilities had changed significantly. 

One other element of this process is also unclear, and may represent a change 

in the scope of presidential influence in rulemaking. The requirement that each 

agency head appoint one of the agency’s presidential appointees as the regulatory 

policy officer does not apply to independent regulatory agencies. However, as originally issued, Executive Order 12866 requires independent regulatory agencies to develop regulatory plans, and the requirement in Executive Order 13422 that the 

‘‘Regulatory Policy Office’’ approve items included in the plan and the commencement of all rulemaking amends that section of Executive Order 12866. Therefore, 

this provision could arguably be read to require that independent regulatory agencies have presidential appointees as regulatory policy officers, thereby extending the 

reach of the President and presidential review into agencies that had not previously 

been subject to such scrutiny (and commensurately lessening the agencies’ relationships with Congress, which created them to be more independent of the President). 

Madam Chairman, that concludes my prepared statement. I would be happy to 

answer any questions that you or other Members of the Subcommittee might have.

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Ms. SA ́ NCHEZ. I appreciate your testimony, Dr. Copeland, and 

you actually went under the 5 minutes. 

Mr. Noe, you are up. 

TESTIMONY OF PAUL R. NOE, PARTNER, C&M CAPITOLINK 

LLC, AND COUNSEL, CROWELL & MORING ENVIRONMENT & 

NATURAL RESOURCES GROUP 

Mr. NOE. Chairman Sa ́nchez, Ranking Member Cannon, Chairman Conyers, distinguished Members of the Subcommittee, my 

name is Paul Noe. I want to thank you for the honor to testify before you on recent changes to the regulatory review process. 

While I am in the private sector now, I have had the privilege 

to spend most of my career in public service, much of it on efforts 

to improve the regulatory process. From 1995 to 2001, I served on 

the Senate Governmental Affairs Committee as counsel to Chairman Bill Roth, Ted Stevens, and Fred Thompson on bipartisan regulatory reform efforts. Then until last May, I worked as counselor 

to Dr. John Graham at OMB’s Office of Information and Regulatory 

Affairs. From my experience in Congress and the Executive 

Branch, I developed a deep appreciation for the importance of a coordinated interagency regulatory review process. I also know that 

the public could not expect more talented or dedicated public servants than those I worked closely with at my time at OMB. 

I should note that my testimony is my personal opinion, and in 

my view, the recent changes to Executive Order 12866 and the accompanying OMB bulletin on good guidance practices are important and salutary steps toward good governance. 

When President Bush issued the amendments to clarify and 

strengthen President Clinton’s Executive Order 12866, the reactions were remarkable, in my view, compared with the actual language. An attachment to my written statement shows how the 

main Bush amendments modified President Clinton’s Order. I 

would like to make just a few points now about how the new Order 

and the OMB bulletin can improve the regulatory process. 

First, extending the existing regulatory review process to significant guidance documents is an important improvement. The Clinton Order appropriately sorted significant regulations from the insignificant, but it neglected guidance documents, and there is no 

doubt that guidance documents can be significant. Concerns have 

been raised by many quarters that agency guidances should be better coordinated, more consistent, more transparent and accountable, and not be used as legally binding regulations. There is a 

very strong foundation for these good guidance practices. In fact, 

Congress required FDA to issue the good guidance regulations that 

were a model for OMB when it designed its bulletin. 

Second, both the Clinton and the Bush Executive Order required 

the agencies to identify the problem that justifies regulation before 

proceeding, whether that problem is a market failure, or something 

else. Although I think the Clinton market failure language was 

adequate, the Bush Order makes a helpful but modest change by 

asking the agencies to identify the problem more precisely and in 

writing to clarify the merits of going forward. 

The Bush Orders language on market failure is simply not new, 

nor is it radical, as some have suggested. In fact, very similar lanVerDate 0ct 09 2002 16:57 Apr 24, 2007 Jkt 000000 PO 00000 Frm 00084 Fmt 6633 Sfmt 6601 F:\WORK\COMM\021307\33312.000 HJUD1 PsN: 33312
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guage and much greater detail is in the Clinton administration’s 

1996 guidelines for economic analysis under Executive Order 

12866. 

I would submit that carefully considering market failures is 

hardly a subversive way of thinking, and indeed, some of the greatest regulatory successes were made possible by market-based approaches that are based upon an understanding of market failure. 

For example, in the 1990 Clean Air Act amendments, Congress established a sulfur dioxide emissions training regime that is one of 

the greatest success stories in the history of environmental law. 

The results of that program were so compelling that OMB supported EPA adopting this same approach in the Clean Air Interstate Rule that Mr. Aitken mentioned. The CAIR rule will cut 

power plant emissions dramatically by about 70 percent without 

the economic disruptions and hardships associated with traditional 

command and control regulation. In my view, it would be most unfortunate if the concept of market failure and market based approaches that flow from it become politicized at a time when they 

are critically important tools in the regulatory policy tool kit. 

Ms. SA ́ NCHEZ. Mr. Noe, you have hit your time, if you could just 

briefly conclude. 

Mr. NOE. Finally, I would like to say that some have alleged the 

concept of regulatory policy officers is a radical change from the 

status quo. I respectfully disagree, and I would like to detail that 

further in question and answer. 

In conclusion, regulatory policy is important and often controversial. It is commendable that this Subcommittee is making the effort 

to view carefully these recent changes and to understand them. In 

my view, a careful review of the language will allay any concerns. 

Thank you. 

[The prepared statement of Mr. Noe follows:]

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PREPARED STATEMENT OF PAUL R. NOE


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Ms. SA ́ NCHEZ. Thank you, Mr. Noe. 

Professor Strauss, please proceed with your testimony. 

TESTIMONY OF PETER L. STRAUSS, PROFESSOR, COLUMBIA 

UNIVERSITY SCHOOL OF LAW 

Mr. STRAUSS. Chairman Sa ́nchez, Ranking Member Cannon, 

Chairman Conyers, distinguished Members, thank you very much 

for inviting me to testify before you today. Given the time constraints, I hope you won’t mind if I launch right into what I have 

to say and not who I am. 

Our Constitution is very clear, in my judgment, in making the 

President an overseer of all the varied duties that you create for 

Government agencies to perform. But the Constitution is equally 

clear in permitting you to assign those duties to them, to the agencies, and not to the President. He is not the decider, but the overseer of decisions by others. When the President fails to honor this 

admittedly subtle distinction, he fails in his constitutional responsibility to take care that the laws be faithfully executed. The assignment of decisional responsibility to others is a part of the laws to 

whose faithful execution he is obliged to see. 

Executive Order 13422 amends the longstanding Executive Order 

12866 in a number of ways that you have heard about. I am going 

to focus on two aspects of the Order that, in my judgment, threaten 

this difficult but necessary balance between politicians and experts, 

between politics and law, that characterizes agency rulemaking. 

First, amendments to sections 4 and 6 effect a dramatic increase 

in the President’s asserted control over regulatory outcomes—an 

increase that, in my judgment, requires congressional authorization 

that has not occurred. 

The second amendment threatens a revival of a discredited, remarkably expensive rulemaking procedure that delivers substantial 

control over the timing and cost of rulemaking into the hands of 

private parties, just those whose dangerous activities proposed regulations are generally intended to limit. 

So first as to presidential control of rulemaking agendas. 

The regulatory plan was first rationalized as an aid to the political heads of administrative agencies, requiring career staff to reveal their priorities and plans for rulemaking to agency leadership 

in the same way that the annual budget process does. It, I think, 

is sensible in that respect. It injects the agency’s political leadership into the picture before matters get set in concrete. While there 

have been some hints that it might be used for presidential control 

over the years, trying to follow that issue I have never heard a 

whisper of it until this Order. 

President Bush’s Order purports to confer legal authority on a 

junior officer in each agency, whose identity has to be coordinated 

with OIRA, to control the initiation of agency rulemaking and, it 

seems to be intended, its continued processing in the agency. Conferring this kind of authority is Congress’s business, not the President’s, and I would urge you not to do it. It diffuses political authority within the agency that you would generally entrust to the 

agency head. 

Congress, as well as the President, has political relationships 

with the agency head. While the President can cashier an agency 

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head whose work he doesn’t like, that comes at high political cost, 

including having to get the Senate’s concurrence on a successor. 

A well-connected friend remarked to me ‘‘I have personally 

watched two agency heads tell the President to pound sand. They 

wouldn’t do what they told and the President knew they had the 

political capital to win.’’ Junior officers appointed under close 

White House supervision, knowing that they can be dismissed at 

any moment—that is what it means to be a presidential appointee—don’t have this political capital. There isn’t much chance 

that firing them will have political costs for the White House. They 

are not ever going to be telling the President or OIRA to pound 

sand. 

There are a number of gaps in the Order that make this problem 

much worse, in my judgment. First, the Clinton Executive Order 

provided that the regulatory policy officer ‘‘shall report to the agency head.’’ That language has been deleted from the Executive 

Order. Second, the amended Order doesn’t tell us what kind of 

presidential appointee the regulatory policy officer is to be. You 

have verbal assurances oh, it will be someone confirmed by the 

Senate, albeit not for that purpose. Here is a road around constraints that the Constitution insists upon, that people who exercise major authority in Government can do so only with the Senate’s blessing, as well as the President’s. The consequence is divided Administration within each agency, with real power vested in 

a shadow officer who answers basically to the President, not to the 

agency head. 

Ms. SA ́ NCHEZ. Mr. Strauss, you have hit your time. If you could 

just conclude briefly. 

Mr. STRAUSS. Okay. 

So let me conclude, if I may, with a suggestion for you. It seems 

to me that this is a simple affront to two of Congress’s responsibilities: to confer organization and authority on elements of Government by enacting statutes, and to approve in the Senate all appointments to high office. You couldn’t change it directly, that 

would encounter a presidential veto, but maybe there are the do 

not spend riders for appropriations measures that have been used 

in the past that could be employed to keep the President from paying salary to persons who are doing work that you have not designated for those persons to do. 

In my printed remarks, I also address the question of formal 

rulemaking, and I would be happy to address that in question and 

answers. 

[The prepared statement of Mr. Strauss follows:]

PREPARED STATEMENT OF PETER L. STRAUSS

President Bush’s recent amendments to Executive Order 12866Thank you very 

much for inviting me to testify before you today. I am a scholar of administrative 

law, who has had the privilege of teaching that subject at Columbia Law School for 

the past 36 years and who for two years in the 1970’s had the honor of serving as 

the first General Counsel of the Nuclear Regulatory Commission. I was later Chair 

of the ABA’s Section of Administrative Law and Regulatory Practice, a consultant 

to the ABA’s Coordinating Committee on Regulatory Reform, and long-time chair of 

the Section’s Rulemaking Committee. My 1984 analysis of agency relations with the 

President won its annual prize for scholarship. I have continued since then to write 

about separation of powers and, in particular, the President’s constitutional relationship to the agencies on which Congress has conferred regulatory authority. AtVerDate 0ct 09 2002 16:57 Apr 24, 2007 Jkt 000000 PO 00000 Frm 00096 Fmt 6633 Sfmt 6621 F:\WORK\COMM\021307\33312.000 HJUD1 PsN: 33312
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1 A predecessor provision may be found in President Carter’s E.O. 12044. 

tached to this testimony is the current draft of my most recent writing on this subject, an essay to be published this summer by the George Washington Law Review 

entitled ‘‘Overseer or ‘The Decider’—The President in Administrative Law.’’ This 

draft will have to be revised in light of the executive order you are hearing about 

today, but its bottom line will not. Our Constitution is very clear, in my judgment, 

in making the President an overseer of all the varied duties the Congress creates 

for government agencies to perform. Yet our Constitution is equally clear in permitting Congress to assign these duties to them and not to the President. He is not 

‘‘the decider,’’ but the overseer of decisions by others. When the President fails to 

honor that admittedly subtle distinction, he fails in his constitutional responsibility 

to ‘‘take Care that the Laws be faithfully executed.’’ The assignment of decisional 

responsibility to others is a part of those laws to whose faithful execution he must 

see. Our subject is Executive Order 13422, 72 Fed. Reg. 2763 (January 23, 2007), that 

amends the long standing Executive Order 12866, concerning regulatory planning 

and review. Others here today may speak to those elements of the order that reach 

guidance documents, another of its important elements, and that heighten the specificity of the analysis the order requires agencies to perform. I will leave those elements largely to them. Let me say only, as a long-time advocate of the proper use 

of guidance to help the public deal with agency regulatory standards, that I find 

the extension of the order to guidance documents possibly troubling only in its details. As a long-time supporter, as well, of the President’s constitutional authority 

and wisdom in commanding regulatory analyses in connection with important 

rulemakings, I find that heightened specificity troubling only insofar as it may be 

administered to require agencies to decide matters on the basis of factors Congress 

has not authorized them to consider. 

In these remarks I want to address two other aspects of the order, that I find particularly troubling—first, enhancements to the existing provisions respecting the 

regulatory planning office and officer that amended § 4(c)(1) of E.O. 12866 by adding

Unless specifically authorized by the head of the agency, no rulemaking shall 

commence nor be included on the Plan without the approval of the agency’s Regulatory Policy Officer,

and § 6(a)(2) of EO 12866 by adding

Within 60 days of the date of this Executive order, each agency head shall designate one of the agency’s Presidential Appointees to be its Regulatory Policy Officer, advise OMB of such designation, and annually update OMB on the status 

of this designation.

and second, an entirely new idea added to § 6(a)(1) of EO, requiring that

In consultation with OIRA, each agency may also consider whether to utilize formal rulemaking procedures under 5 U.S.C. 556 and 557 for the resolution of 

complex determinations.

Both additions threaten to disturb the difficult but necessary balance between 

politicians and experts, between politics and law, that characterizes agency rulemaking. The first threatens a dramatic increase in presidential control over regulatory outcomes, to an extent Congress has not authorized and in my judgment 

must authorize. The second threatens redeployment of a discredited, remarkably expensive rulemaking procedure that delivers substantial controls over the timing and 

cost of rulemaking into the hands of private parties—notably, I fear, those whose 

dangerous activities proposed regulations are intended to limit. 

I. PRESIDENTIAL CONTROL OF RULEMAKING AGENDAS

When President Reagan elaborated the idea of a regulatory agenda in Executive 

Order 12498,1 Christopher DeMuth, who had responsibilities for these issues in his 

administration, characterized it as essentially an aid to the political heads of administrative agencies—requiring career staff to reveal their priorities and plans for rulemaking to agency leadership, just as the annual dollar budget process does, and consequently injecting the agency’s political leadership into the picture before matters 

got set in bureaucratic concrete. Seen in this way, the measure supported Congress’s 

assignments of responsibility—it is, after all, on the agency’s political leadership 

alone that Congress’s statutes confer the power to adopt rules. To judge by its own 

actions in measures like the Regulatory Flexibility Act, Congress like the private 

community was also attracted by the transparency and added opportunities for 

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broad public participation early notice of rulemaking efforts would provide. President Clinton’s Executive Order 12866 continued and in some ways strengthened this 

measure, requiring agencies to designate a regulatory policy officer who would coordinate general issues under the Executive Order—in effect be the agency’s designated contact person for the OMB Office of Information and Regulatory Affairs 

(OIRA). While there were hints that it might be used to effect presidential control 

over agency policy choices, after years of paying fairly close attention to this question in my scholarship and professional associations, I have never heard that that 

had happened. On specific issues of importance to him, as Dean Elena Kagan of 

Harvard has detailed, President Clinton through his domestic policy office—not 

OIRA—would issue directives to particular agencies on particular issues of importance to his program. President Bush’s first head of OIRA, John Graham, initiated 

a practice of occasional ‘‘prompt letters’’ publicly directing agency attention to matters that he concluded might warrant regulation. But a general centralization of actual control over regulatory agendas, so far as I could tell, was never effected. Until 

this order. 

President Bush’s order purports to confer authority on a junior officer in each 

agency, whose identity must be coordinated with OIRA, to control the initiation of 

agency rulemaking and, it seems to be intended, its continued processing within the 

agency. I would have thought conferring this kind of authority Congress’s business, 

not something the President is authorized to accomplish on his own say-so. And if 

Congress were to ask my judgment about such a step I would call it unwise—as a 

diffusion of political authority within the agency, that Congress generally entrusts 

to the agency head. While legislation may permit the head to subdelegate some of 

her authority to persons she trusts and will take responsibility for, it wisely has 

rarely if ever permitted subdelegation of ultimate control over rulemaking, and it 

certainly would be unwise to permit that to persons who are controlled by others 

outside the agency. Congress as well as the President has political relationships 

with the agency head. While the President has a formal capacity to discipline agency heads whose work displeases him, that capacity is sharply limited by the political 

costs of doing so—including the necessity of securing senatorial confirmation of a 

successor. As a well-connected friend of mine recently remarked,

I personally have watched two agency heads tell the President to pound sand—

they wouldn’t do what they were told and the President knew they had the political capital to win.

Junior officers, given their responsibilities in a process under close White House supervision, knowing as ‘‘presidential appointees’’ that they can be dismissed at any 

moment, and lacking both this political capital and much prospect that their dismissal would have, in itself, political costs for the White House, are not ever going 

to be telling the President or OIRA to pound sand. 

A number of gaps in the order make this problem, in my judgment, a lot worse.

• First, the Clinton executive order reinforced ordinary agency hierarchy by 

providing in § 6(a)(2) that the regulatory policy officer ‘‘shall report to the 

agency head.’’ That language has been omitted. Now it is at least ambiguous 

to whom the RPO reports. Anyone aware of the change—the agency head, for 

example—will know that this mandatory relationship has been eliminated.

• Second, the amended order now requires that the ‘‘policy officer’’ be a ‘‘presidential appointee,’’ but it doesn’t tell us what kind of presidential appointee—

one who must also be confirmed by the Senate? One the President can name 

without need for confirmation? Perhaps a non-career officer in SES, whose appointment occurs only after White House clearance and with a presidentiallysigned commission? If it is either of the latter, then the President has found 

his way around the constraints the Constitution insists upon, that people who 

exercise major authority in government can do so only with the Senate’s 

blessing as well as his. Then it becomes obvious that the President has created a divided administration within each agency, with real power vested in 

a shadow officer who essentially answers only to him. As my friend also remarked, this would be ‘‘disastrous.’’

First as a practical matter it takes regulatory power away from the head 

of the agency where Congress has vested it. Second, it continues the political accretion of power in the bureaucracy of the White House, away 

from public scrutiny. But, the worst part from my vantage point is that 

it treats the agency as a conquered province—the career staff is explicitly 

told it is distrusted and is not to make recommendations to the agency 

head but to the White House’s political officers. That in turn destroys 

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2This is not the setting to explore the accounts I am beginning to hear of increasing, and in 

my judgment, regrettable, politicization and transparency violations in OIRA functioning—for 

example, deliberate holding back the clock on formal submission of agency proposals to OIRA, 

so that negotiations and ‘‘adjustments’’ can be complete before the transparency provisions of 

EO 12866 kick in. See United States General Accounting Office, Report to Congressional Requesters,’’RULEMAKING, OMB’s Role in Reviews of Agencies’ Draft Rules and the Transparency of Those Reviews’’ GAO–03–929, September 2003, pp. 47–48. When evidence of OIRA 

changes has been available, it has been available to assist reviewing courts in determining 

whether agencies have themselves reached the decisions statutes commit to their responsibility, 

and done so only on consideration of the statutorily relevant factors. See Riverkeeper, Inc. v. 

EPA, No. 04–6692–ag(L), 2007 U.S. App. LEXIS 1642 (2d Cir. Jan, 25, 2007), where the published documents showed 58 ‘‘major’’ changes having been made ‘‘at the suggestion or recommendation’’ of OIRA at the proposal stage, and 95 ‘‘major’’ changes made ‘‘at the suggestion 

or recommendation’’ of OIRA in the rule as finally promulgated.

communication between the staff and the political level of the agency. 

And, the agency is quite ineffective when that happens.

• Third, it is unclear to what extent the new controls extend to the independent 

regulatory commissions. Section 4’s language, including the requirement that 

‘‘Unless specifically authorized by the head of the agency, no rulemaking shall 

commence nor be included on the Plan without the approval of the agency’s 

Regulatory Policy Officer,’’ is explicitly applicable to independent regulatory 

commissions. Section 6, that defines the regulatory policy officer’s appointment, is not. As a legal requirement of agencies Congress has chosen to constitute as independent regulatory commissions, this is truly extraordinary.

• The final gap I want to note for you, one of signal importance in my judgment, concerns political access. Among the elements that have made the Executive Order regime acceptable to Congress, and I might add to much of the 

academic community, are the commitments it contains to a professionalized, 

unusually transparent and apolitical administration. Oral contacts with outside interests are limited to OIRA’s senate-confirmed Administrator or his 

particular designee; agencies attend any meetings with outsiders; written 

communications from outsiders are also logged; and all of this information is 

publicly disclosed. My understanding is that Congress has properly insisted 

on these elements of transparency, as a condition of its acceptance of this generally valuable regime. The OIRA website, within a generally closed White 

House environment, has been a remarkable monument to the worth of this 

insistence.2 The professional qualities, too, of OIRA’s staff, and the striking 

qualities of its leadership over time, have offered reassurance. Notice that 

none of these constraints are made applicable to the Regulatory Policy Officer 

or his office. 

So the President has attempted to do by executive order something that, in my 

judgment, can only be done by statute. Moreover, in doing so he threatens excessive 

politicization of agency rulemaking, the subversion of a public process by back-corridor arrangements, and compromising the lines of authority Congress has created. 

These officers will, in practice, be answerable only to him, as is underscored by the 

disappearance of ‘‘shall report to the agency head’’ from § 6(a)(2). Their conversations with him, his lieutenants, and any political friends he may send their way will 

be invisible to us. 

You will likely hear from the other side that the President is, after all, our chief 

executive, that our Constitution embodies the judgment that we should have a unitary executive, and so even if the result were to convert agency judgments about 

rulemaking into presidential judgments, that would only be accomplishing what the 

Constitution commands. This is the subject of the writing I have attached to this 

testimony. In my judgment it is not only an erroneous argument, but one dangerous 

to our democracy. The President is commander in chief of the armed forces, but not 

of domestic government. In domestic government, the Constitution is explicit that 

Congress may create duties for Heads of Departments—that is, it is in the heads 

of departments that duties lie, and the President’s prerogatives are only to consult 

with them about their performance of those duties, and to replace them with senatorial approval when their performance of those duties of theirs persuades him that 

he must do so. This allocation is terribly important to our preservation of the rule 

of law in this country. The heads of departments the President appoints and the 

Senate confirms must understand that their responsibility is to decide—after appropriate consultation to be sure—and not simply to obey. We cannot afford to see all 

the power of government over the many elements of the national economy concentrated in one office. 

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Professor Peter Shane, a highly respected scholar of the presidency and a former 

lawyer in the Office of Legal Counsel, put the matter this way in a recent discussion 

of President Bush’s use of signing statements, which I know is not our subject 

today.

The Bush Administration has operated until recently in tandem—can there 

be a three-part tandem?—with Republican Congresses and a Supreme Court 

highly deferential to executive power. . . . It has not only insisted, in theory, 

on a robust constitutional entitlement to operate free of legislative or judicial 

accountability, but it has largely gotten away with this stance. And that success—the Administration’s unusual capacity to resist answering to Congress 

and the courts—has fed, in turn, its sense of principled entitlement, its theory 

that the Constitution envisions a Presidency answerable, in large measure, to 

no one. 

Critics of the Administration have not infrequently charged that the Administration’s unilateralism is antagonistic to the rule of law. After all, the ideal of 

a ‘‘government of laws, not of men’’ seems conspicuously at odds with a President’s expansive claims of plenary authority. But no sane President claims to 

be above the law and, indeed, President Bush takes pains repeatedly to defend 

his controversial actions as legal, including the widespread warrantless electronic surveillance of Americans, the incarceration of U.S. citizens as enemy 

combatants, and the intense interrogation of detainees in Iraq and Afghanistan. 

I doubt that President Bush thinks himself antagonistic to the rule of law; he 

just has a different idea of what the rule of law consists of. But what the Administration seems to believe in is a version of the ‘‘rule of law’’ as formalism. 

It is the rule of law reduced to ‘‘law as rules.’’ Under the Bush Administration’s 

conception of the rule of law, Americans enjoy a ‘‘government of laws’’ so long 

as executive officials can point to some formal source of legal authority for their 

acts, even if no institution outside the executive is entitled to test the consistency of those acts with the source of legal authority cited. . . . 

The Bush signing statements, like the doctrines they advocate, are a rebuke 

to the idea of the rule of law as norms or process. They are a testament to the 

rule of law as law by rules, preferably rules of the President’s own imagination.

This executive order is cut from the same cloth. 

What might Congress do about this? This looks like a simple affront to two of 

Congress’s responsibilities—to confer organization and authority on elements of government by enacting statutes, and to approve (in the Senate) all appointments to 

high office (thus creating one of the Constitution’s many checks on unilateral authority in any branch). Change here, though, would likely encounter a presidential 

veto. Can you find a way to avoid that? There remains the power of the purse. While 

the use of ‘‘do not spend’’ riders in appropriations measures has often been criticized, perhaps this is a setting in which such a rider would be appropriate, attached 

to a budget the President will find himself compelled to sign. Why should Congress 

tolerate the expenditure of government funds to pay the salary of one whose powers 

it has not authorized, and whose functioning can prove destructive of the public institutions it has worked to create? 

II. OUTSIDER CONTROL OF RULEMAKING

I can be much briefer in addressing the provision of the executive order that invites agencies to ‘‘consider whether to utilize formal rulemaking procedures under 

5 U.S.C. 556 and 557 for the resolution of complex determinations,’’ ‘‘in consultation 

with OIRA.’’ This is permissively worded, but one must wonder how permissive its 

implementation will be. And the point to note is that the difference between ‘‘formal 

rulemaking procedures under 5 U.S.C. 556 and 557’’ and the notice-and-comment 

procedures agencies generally employ, is that the former put rulemaking under the 

procedural control of an administrative law judge, a person trained in trials not policy-setting, and confer on participants in the rulemaking the kinds of rights parties 

to trials have—rights to put on witnesses, engage in cross-examination, and in other 

ways slow rulemaking down and add to its internal costs. It is, simply, the delivery 

of the henhouse to the foxes. 

Experience with on-the-record rulemaking led to its virtual abandonment decades 

ago, and for good reason. Those familiar with the process have recognized for 40+ 

years that it is simply too clumsy to work except in very isolated instances. In its 

1973 judgment in U.S. v. Florida East Coast Rwy, 410 U.S. 224, the Supreme Court 

essentially ruled that agencies did not need to use it in the absence of the clearest 

of statutory instructions. Congress hasn’t been giving those instructions, and agencies haven’t been using that process ever since, and for good reason. Experience has 

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taught us that the use of formal rulemaking is cumbersome and out of all proportion 

to its benefits because trial-type hearings are poorly suited for determinations that 

turn on policy judgments, and too subject to unwarranted extension and complication by the participant parties. Why, then, revive it now? Just to help one’s friends 

slow things down—throw a good dose of sand into the gears of rulemaking? 

Thank you for the opportunity to address you today. I would be happy to answer 

any questions you might have.

Ms. SA ́ NCHEZ. Thank you, Professor Strauss. 

I want to thank all of the panelists for testifying today, and I 

want to remind you that your full written statements will be placed 

into the record. 

We are now going to proceed with questions under the 5-minute 

rule, and I will begin by recognizing myself for 5 minutes. 

Mr. Aitken, you noted that Executive Order 13422 encourages 

rulemaking agencies to consider using the Administrative Procedure Act’s formal rather than informal rulemaking procedures for 

the agency’s resolution of complex determinations. Why do you 

think that that encouragement is necessary? 

Mr. AITKEN. Thank you for your question. 

The reason that that provision is in the Executive Order is simply to remind agencies that under the Administrative Procedure 

Act, they have a tool in their tool belt that they can use to resolve 

complex determinations. As I mentioned in my prepared testimony, 

that provision has been in the Administrative Procedure Act for 

decades. Agencies have been able to use that authority for decades, 

and the Executive Order simply reminds the agencies of this authority and encourages them to consider it. 

Ms. SA ́ NCHEZ. But is there any evidence to the contrary that they 

don’t use the formal rulemaking procedures when appropriate and 

necessary? 

Mr. AITKEN. I don’t think the Executive Order is premised on a 

view that agencies were using it insufficiently; it simply reminds 

agencies that there is a provision in the APA that is available for 

their use if they believe it is appropriate. 

Ms. SA ́ NCHEZ. Okay, thank you. 

Professor Katzen, what do you believe Congress should do about 

this Executive Order? Congress, as Professor Strauss suggested, 

could put a rider on OMB’s or an agency’s appropriation prohibiting the implementation of the Order, or is there something else 

that Congress can do? 

Ms. KATZEN. As an alum of OMB, I am always somewhat nervous about talking about riders on spending bills. 

I think, first and foremost, you have done the right thing by calling a hearing. Oversight by Congress is incredibly important and 

has not been in vogue for the last several years. Knowing that you 

will be held accountable and asked why is this section in there, 

what does that section do, what is the problem, has a very salutary 

effect. I also believe that Dr. Copeland has put his finger on something with respect to the appointments power and Senate confirmation. I personally believe that if you are going to hold the position 

of regulatory policy officer as it is described in here and not be reporting directly to the head of the agency, which was the way we 

had structured the job, then it would be appropriate for the Senate 

to inquire as to both the competence and the temperament and perVerDate 0ct 09 2002 16:57 Apr 24, 2007 Jkt 000000 PO 00000 Frm 00101 Fmt 6633 Sfmt 6601 F:\WORK\COMM\021307\33312.000 HJUD1 PsN: 33312
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haps the regulatory philosophy of the person who would hold that 

job. And so I would use the power of appointment. 

Authorizing Committees could also do legislative work. As I said, 

these are the agencies. These are not free agents. They do what 

Congress has told them to do, and if Congress says that a factor 

is to be—is irrelevant or not to be considered, the agencies will follow and the Executive Order as originally structured said ‘‘subject 

to existing law,’’ that means subject to what you all say. So I would 

use those routes. 

Ms. SA ́ NCHEZ. I appreciate your answer. 

Mr. Noe, will Executive Order 13422, as asserted by New York 

Times columnist Paul Krugman, ‘‘make it easier for political appointees to overrule the professionals, tailoring Government regulations to suit the interests of companies,’’ and if not, please explain. 

Mr. NOE. Madame Chair, I think the answer is no because I 

think that the changes that are made, for example, to the provisions on regulatory policy officer are insignificant, other than creating greater, not less, political accountability. 

This position was created by the Clinton Order. There was no 

constraint on who could serve as a regulatory policy officer. You 

could have had someone who was non-accountable to the Congress 

serve in that position. Under the change, the benefit for Congress 

will be that person will serve in a congressionally created position 

that is typically subject to Senate confirmation, and typically engages with the Congress in oversight. So I think as far as oversight 

committees go, this Executive Order is good news. 

Ms. SA ́ NCHEZ. Professor Katzen, I notice that you did not seem 

to agree. Could you just briefly respond to that? 

Ms. KATZEN. Under the Clinton Order, the regulatory policy officer had to report directly to the agency head. That was the accountability within the agency. 

Ms. SA ́ NCHEZ. Okay, thank you. 

I would now like to recognize the Ranking Member of my Subcommittee, Mr. Cannon, for 5 minutes. 

Mr. CANNON. I think we have identified the problem, and it is 

not you, Ms. Katzen, it is the mic—the button. We are going to 

have to get that fixed. 

It has been very interesting hearing, a little more animated than 

I would have guessed at the outset. We have Dr. Copeland, who is 

very jealous of Congress’s prerogatives and his comments were directed that we have two people that have the view that Government and bureaucracy has a tendency to perpetuate itself and 

sometimes perpetuate stupidity. We have two people, Professor 

Katzen and Professor Strauss, who believe that bureaucracy should 

be a counterweight to the role of the President. And of course, that 

is, at least in this given presidency, you have some conflict with the 

stayed problems that this Administration has decided exist within 

the regulatory context. I personally served in an agency. I had 100 

lawyers who worked for me. We developed regulations and I have 

the greatest respect for civil servants. The problem is civil servants 

are part of bureaucracy, and bureaucracies don’t change very 

quickly. 

So what we are dealing with here, it seems to me at a higher 

level, is how we deal with a world that has changed radically 

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around us and has resulted in a proliferation of Government law 

in the context where we don’t have—we, that is, Congress, does not 

have the kind of controls that these—Professor Katzen and Professor Strauss and Dr. Copeland are insisting are important here. 

Let me just—one example that I had, a political friend came in 

and told me that I should take the Code of Federal Regulations 

into my next meeting. I said, do you know how tall that is? And 

then he raised his arm about six feet high, and I said when was 

the last time you saw the Code of Federal Regulations? I brought 

him down here and showed him our library—Majority’s library. 

Our library, I guess, but in their side. He was dumbfounded. He 

was absolutely dumbfounded because—I don’t know what it is, but 

my guess is that if you stack the Code of Federal Regulations up 

it would be about 25 or 30 feet, far more than what he had anticipated, and that doesn’t include the guidance documents and the informal guidance which never gets in a document. What we have 

here is a Government that has vastly insinuated itself in the fabric 

of American life. And Professor Strauss, you mentioned that we are 

dealing with dangerous people who we have to control. Granted, 

there are people who will take advantage. We need sometimes to 

have some control, especially—well, there are some things we need 

to control and probably some things that we just interfere with and 

cause pain and suffering by trying to control. 

And so what I would hope—we have worked together over a long 

period of time, many of us, on the APA. Many of these issues are 

going to be—are issues that we need to look at from the very highest level. In other words, there are differences that are very apparent in this discussion and I think those are legitimate differences, 

but we need to take a look at how we actually govern ourselves and 

look back at the APA to get some guidance. 

We need to come up with a thoughtful bipartisan new approach 

to the APA that will allow us to deal with this much more complex 

world that we are engaged in, because really what we are talking 

about here—I mean, for people who don’t understand this discussion, we are not talking about regulations. We are not talking 

about law. We are not talking about that law which is passed by 

Congress and signed by the President. We are talking about guidance when a company or a person has a problem understanding 

what a regulation means in his evolving business environment or 

other environment in his life, and he says tell me what this means. 

And that answer can come from a bureaucrat in a regional office 

who may not want to be bothered, or it can come through a process 

that evolves into a directive that has profound influence. And in 

the world today with oil at 70, 80, 90, maybe at some point in the 

future $100 a barrel, that drives issues and creativity and that is 

just one of the many things that are happening in our society. 

Communication has evolved rapidly. That drives innovation and we 

find ourselves regulating in a context of a presumed danger, when 

at the same time we have great opportunities for a better society. 

And so I am—I actually very rarely do this. I have lectured and 

I apologize, but what I hope comes out of this discussion is that instead of blaming this President—and by the way, Professor Katzen 

and Professor Strauss, your comments were well-taken and I appreciate them, and you have educated me on the subject. But this 

100

seems to be a canard. It seems to be off the track of what we need 

to do as a Committee, and Dr. Copeland, from your perspective, we 

need—and others in the audience, we need to deal with a world 

that is different, entirely different from the world that we inherited 

10 or 20 or 45 years ago, 44 years ago when we passed the APA 

the first time——

Ms. SA ́ NCHEZ. The gentleman’s time has expired. 

Mr. CANNON. I thank the gentlelady for indulging me, and yield 

back. 

Ms. SA ́ NCHEZ. Thank you. 

The gentleman from Michigan is recognized. 

Mr. CONYERS. I thank the gentlelady and Chair. 

The gentleman from Utah can tell the witnesses that he doesn’t 

lecture very often, but you know, we are on the Committee, Chris. 

We know a lot better than that. And we enjoy your criticisms and 

comments. 

I would ask unanimous consent to place into the record Paul 

Krugman’s ‘‘New York Times’’ column of February 5, 2007. 

Ms. SA ́ NCHEZ. Without objection, so ordered. 

[The information referred to follows:]

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Mr. CONYERS. And I hate to read the last two sentences, because 

we may get another lecture before this hearing is over. 

‘‘What’s truly amazing is how far back we’ve slid in such a short 

time. The modern civil service system dates back more than a century; in just six years the Bush administration has managed to 

undo many of that system’s achievements. And the Administration 

still has two years to go.’’

You know, this brings in the notion of conservatism, contracting, 

and I need some guidance from some of our witnesses. We have got 

the appropriations process, passing laws, confirmation proceedings, 

and any succeeding President can revoke any Executive Order that 

he or she chooses. Those aren’t a very tasty set of options to me. 

What do you think, Professor Strauss? Is there—it seems like we 

are something like in the position of trying to get out of Iraq. We 

don’t want to cut off the funds. We are—we want to pass non-binding resolutions. We want to voice our opposition. 

Mr. STRAUSS. I find a lot of merit in that analogy, unhappily. I 

think you are stuck. I mean, if you were to take the position which, 

in my judgment, is the right position, that authorizing someone in 

Government to act with the force of law, which is what this Executive Order does for the regulatory policy officer, is something that 

only Congress can do and the President can not do. You are not in 

the position of being able to undo that by a simple statute unless 

you can get it past a presidential veto, which as I read the newspapers, my guess is you can not. So then you are left with a series 

of unpalatable other alternatives. I don’t, myself, like appropriations riders at all. I think they have been misused in the past, 

but——

Mr. CONYERS. I don’t even think we can sue in court, unless it 

is a constitutional issue. 

Mr. STRAUSS. I don’t know how. 

Mr. CONYERS. How did you find this subject matter to start the 

hearing off on administrative law? I mean, this is more difficult 

than most of the other issues that we handle. I am wondering—

perhaps a very detailed examination of this is going to make it 

clear to the public. I mean, this may be another case for public sentiment to kick in, because most people of course haven’t the vaguest idea that this has occurred. 

Mr. STRAUSS. Newspaper reporters tend to describe stories about 

process, as one did to me in the work-up of this occasion, as three 

bowlers. That is to say, the reader’s face will predictably plop in 

the oatmeal three times before they finish the story. I don’t know 

that it will be easy to make it into——

Mr. CONYERS. Dr. Copeland, what is your diagnosis here? 

Mr. COPELAND. I would refer to a document that was prepared 

by a colleague of mine at CRS, TJ Halstead, on Executive Orders, 

and he mentions previous instances where Congress has revoked 

them, most recently Executive Order 12806, where Congress revoked an Order by President George H.W. Bush to establish a 

human fetal tissue bank for research purposes. To effectuate this 

repeal, Congress simply directed that ‘‘The provisions of Executive 

Order 12806 shall not have any legal effect.’’ While this seems to 

be the most recent action, there have been numerous similarly revoked Executive Orders. 

103

So there is precedent for Congress revoking Executive Orders. 

Ms. SA ́ NCHEZ. The time of the gentleman has expired. 

Mr. CONYERS. Thank you. 

Ms. SA ́ NCHEZ. Thank you. 

I now recognize the gentleman from Georgia, Mr. Johnson, for 5 

minutes. 

Mr. JOHNSON. Thank you. I have got some questions, Mr. Noe. 

You were quoted in the Washington Post as saying that the controversy about this new Executive Order is ‘‘a tempest in a teapot.’’ 

Given that the Order appears to create a cadre of presidentially appointed regulatory police officers who no longer report to the agency heads who designate them, how can this be considered a ‘‘tempest in a teapot’’? Isn’t it more serious than that, more fundamentally earth-shaking than that? 

Mr. NOE. Thank you for your question, Congressman. 

The reason I would call it a ‘‘tempest in a teapot’’ is because I 

think a lot of the concerns that were raised in the initial press reports were not based on a reading of the actual language of the 

Order, or an understanding of what was already in the existing Executive Order that President Clinton issued. It was not based on 

an understanding that these regulatory policy officers were not created by President Bush, they were created by President Clinton, 

and——

Mr. JOHNSON. But this is a fundamental reordering of this Executive Order, is it not? 

Mr. NOE. Well, sir, I think that the main change in that part of 

the Order is to say a regulatory policy officer, who admittedly was 

appointed by the agency head under the old Order, now actually 

had to be in a congressionally created position which is going to be 

more accountable politically and more accountable to congressional 

oversight, I would submit, than what was previously undefined. 

And that is what I mean when I say I think that there has been 

a lot of misunderstanding about these provisions, that when they 

are actually read closely I don’t think there is less political accountability. I don’t there is anything new or radical. I actually think 

this could be used to provide greater accountability to the Congress, and I respect the importance of that, having worked in Congress as a staffer for 7 years. 

Mr. JOHNSON. Well, you were also quoted as saying that the Executive Order promotes better informed and more accountable regulatory decisions. Can you explain that a little more? 

Mr. NOE. Yes, sir. 

I think it is a real improvement over President Clinton’s Order 

to include guidance documents within the interagency review process, because I have seen many instances where businesses, small 

businesses especially where people can not keep up with these 

things, schools, farmers are hurt or affected by these things and 

they don’t have any idea that they are coming at them. They have 

no idea of how to access them. And I could tell you, just having 

heard a number of stories about this, that I think it is very important that that very important component of regulation is brought 

within the interagency review process. I think that is a big improvement. 

Mr. JOHNSON. Professor Katzen, what is your response? 

104

Ms. KATZEN. Well, I find it ironic that on one hand they say it 

is not doing anything, and on the other hand they say it is doing 

something. I really don’t think they can have it both ways. 

On the guidance documents, they do not have the force and effect 

of law, but they do have an influence, and I am interested in the 

fact that in Mr. Aitken’s testimony he keeps referring back to the 

FDA guidance process. That process had Congress intimately involved. It was Congress that authorized the FDA to——

Mr. JOHNSON. By the way, Mr. Noe was here before you came in 

and he made sure to change that microphone. 

Ms. KATZEN. I am not paranoid, it just doesn’t work. 

But Congress was the one that authorized the FDA to issue these 

guidance documents. Congress was the one that called for public 

participation. So if you are using the FDA guidance documents as 

a model, then Congress needs to be involved. Incidentally, Congress 

did not authorize OMB to review those FDA guidelines that it authorized. What has been done here is like cherry picking, where 

they take what they like and they add to it what they really like, 

and they now have got a different kind of an animal. 

The bottom line is that Congress has to act. Congress has to become involved, and I think that whether it is looking at the APA 

generally or looking at the provisions of how the Executive Order 

is being implemented, Congress has a constitutional obligation and 

a constitutional role to play, and I encourage you to do it. 

Mr. JOHNSON. Professor Strauss, in your testimony——

Ms. SA ́ NCHEZ. The time of the gentleman has expired. 

Mr. JOHNSON. All right, thank you. 

Ms. SA ́ NCHEZ. It is now my pleasure to recognize the gentleman 

from Massachusetts, Mr. Delahunt, for 5 minutes. 

Mr. DELAHUNT. Thank you, Madame Chair. It is very reassuring 

to serve on this Committee under your leadership. 

Professor Katzen, it is good to see you once more. 

You know, I look at this in a larger sense. We have had an Administration that has spoken time and time again about this concept of—I think the term is unitary Executive power, which I view 

as a continuing encroachment on legislative authority. I see this 

just as another piece of that. Is that a comment that you would like 

to respond to, Professor Strauss? 

Mr. STRAUSS. I think you heard that from Professor Katzen as 

well. There has been——

Mr. DELAHUNT. I came too late for her testimony. 

Mr. STRAUSS. There has been a clear acceleration, and to be fair 

about it, this is a process that began with President Nixon, and 

since his Administration, President after President has done more 

and more to bring the bureaucracy within the political influence 

over the White House. I think what Mr. Cannon had to say in his 

statement has an awful lot of merit to it. 

The question for me is when you cross the line, you have some 

wish to have not only politics, but also expertise, and when what 

one sees is just politics, one gets——

Mr. DELAHUNT. Well, I think maybe, you know, the Ranking 

Member and I would agree on some of this. I think this is an institutional—this is institutional combat, if you will. And I think we 

have got to be prepared to go to war. Enough is enough, and withVerDate 0ct 09 2002 16:57 Apr 24, 2007 Jkt 000000 PO 00000 Frm 00108 Fmt 6633 Sfmt 6601 F:\WORK\COMM\021307\33312.000 HJUD1 PsN: 33312
105

out even getting into the merits of this particular Executive Order, 

because I think it is a statement as to whether this institution, the 

first branch of Government, has the capacity to retain its constitutional authority. And I would hope that, given the leadership of 

Congresswoman Sa ́nchez, that there might exist the possibility of 

a discussion with the Executive Branch to determine what modifications ought to occur from the perspective of Congress as to this 

Executive Order, and if that just simply is not feasible, if it is not 

welcome by the Administration, then we ought seriously consider 

legislative action rescinding the Order. 

Mr. CANNON. Would the gentleman——

Mr. DELAHUNT. I yield to my friend from Utah. 

Mr. CANNON. Thank you. You know, we live in a very political 

world and we just lost on the Republican side and were much chastened. 

But let me just remind the gentleman that when you suggest we 

go to war over this issue that America has changed profoundly. Before President Reagan, at the beginning of his Administration, the 

vast majority, over 60 percent of all people were employed by large 

corporations of over 5,000 employees. Today, the vast majority are 

employed by small companies. So what we are doing here, and 

what I hope this Committee will do over the long term, is create 

a context where Americans can thrive, and in this battle, we need 

to remember that this is not us against the President, although Dr. 

Copeland, as you are aware, I am keenly concerned with the prerogative——

Mr. DELAHUNT. Reclaiming my time. 

I am not in disagreement and I clearly am sympathetic to, you 

know, the small business owner. I think Members of Congress are. 

That is not the issue here. 

The issue is whether this is appropriately within the prerogative 

of Congress pursuant to our constitutional authority, and if it is, 

I think that we can demonstrate as much sympathy and support 

for the small business community. This, to me, is a constitutional 

issue. It has got nothing to do with the merits of a particular Executive Order. I mean, I am concerned. I mean, the—what was the 

book, the Imperial City. I mean, we had political appointees there 

that were running the Stock Exchange who didn’t have a degree in 

economics. You know, is there—I haven’t really—I will acknowledge that I haven’t read the Executive Order, but the idea of some 

sort of confirmation process by the Senate just to assure Members 

of Congress that we are getting people who have an expertise and 

are not just simply political appointees like we see. We have seen 

them in Iraq, we saw them in the aftermath of Katrina, and there 

was much to be revealed. 

I don’t mean to just beat up on the Bush administration, but 

they are handy right now. 

Ms. SA ́ NCHEZ. The time of the gentleman has expired. 

I would like to thank again all the witnesses for their testimony. 

Members may have additional written questions for our witnesses 

which we will forward to you and ask that you answer as promptly 

as you can so that they can be made part of the record. 

Without objection, the hearing record——

Mr. DELAHUNT. Madame Chair? 

106

Ms. SA ́ NCHEZ. The gentleman is recognized. 

Mr. DELAHUNT. If I could ask for unanimous consent for an additional minute. 

Ms. SA ́ NCHEZ. The gentleman——

Mr. DELAHUNT. I would like to congratulate the Chair for conducting her first hearing. You did it with your customary aplomb 

and professionalism, and I know I speak for Mr. Cannon. We all 

look forward to working with you. 

Ms. SA ́ NCHEZ. Thank you. 

As I was saying before I was so pleasantly interrupted, we will 

be submitting additional questions in writing. We ask that you respond to those questions so that they can be—as quickly as you can 

so that they can be made part of the record. 

Without objection, the hearing record will remain open until the 

close of business on Friday for the submission of additional materials. 

[The material in the following list was submitted by the Minority 

for inclusion in the hearing record. The material is not reprinted 

in this hearing but is on file at the Subcommittee. The information 

referred to is as follows:]

LIST OF MATERIAL SUBMITTED BY THE MINORITY FOR INCLUSION

IN THE HEARING RECORD

1. Food and Drug Administration Modernization Act of 1997, 21 U.S.C. § 371(h) 

2. ‘‘Food and Drug Administration Modernization and Accountability Act of 1997,’’ 

S. Rep. 105–43, at 26 (1997) 

3. Executive Order No. 13422, 72 Fed. Reg. 2763 et seq. (Jan. 23, 2007) 

4. Executive Order No. 12866, 58 Fed. Reg. 51,735–44 (Oct. 4, 1993) 

5. Executive Order No. 13258, 67 Fed. Reg. 9,385–86 (Feb. 28, 2002) 

6. Redline-strikeout version of E.O. 12866 as amended by E.O. 13422

7. U.S. Office of Management and Budget Bulletin No. 07–07, ‘‘Final Bulletin for 

Agency Good Guidance Practices,’’ 72 Fed. Reg. 3,432–40 (Jan. 25, 2007) 

8. U.S. Office of Management and Budget, ‘‘Proposed Bulletin for Good Guidance 

Practices,’’ 70 Fed. Reg. 71866 et seq. (Nov. 30, 2005) 

9. U.S. Office of Management and Budget Circular A-4, ‘‘Regulatory Analysis,’’ 

(Sept. 17, 2003) 

10. U.S. Office of Management and Budget, ‘‘Stimulating Smarter Regulation: 2002 

Report to Congress on the Costs and Benefits of Federal Regulation,’’ (2002) 

11. U.S. Office of Management and Budget, ‘‘Draft 2002 Report to Congress on the 

Costs and Benefits of Federal Regulation,’’ 69 Fed. Reg. 15014 et seq. (March 

28, 2002) 

12. U.S. Office of Management and Budget Memorandum, ‘‘Economic Analysis of 

Federal Regulations under Executive Order No. 12866,’’ (Jan. 11, 1996) 

13. U.S. Office of Management and Budget, M-00-08, ‘‘Guidelines to Standardize 

Measures of Costs and Benefits and the Format of Accounting Statements,’’ 

(March 22, 2000) 

14. Regulatory Program of the United States (April 1, 1990 March 31, 1991), at pp. 

653–54

15. Appalachian Power Co. v. EPA, 208 F.3d 1015, 1019 (D.C. Cir. 2000) 

16. Robert A. Anthony, ‘‘Interpretive Rules, Policy Statements, Guidances, Manuals 

and the Like—Should Federal Agencies Use Them to Bind the Public?’’ 41 Duke 

L.J. 1311 (1992) 

17. Robert A. Anthony, ‘‘ ‘Interpretive’ Rules, ‘Legislative’ Rules and ‘Spurious’ 

Rules: Lifting the Smog,’’ 8 Admin. L.J. (Spring 1994).

Ms. SA ́ NCHEZ. I thank everyone again for their time and patience, and without objection, the hearing of the Subcommittee on 

Commercial and Administrative Law is adjourned. 

[Whereupon, at 3:30 p.m., the Subcommittee was adjourned.] 

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A P P E N D I X 

MATERIAL SUBMITTED FOR THE HEARING RECORD

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POST-HEARING QUESTIONS AND RESPONSES FOR STEVEN D. AITKEN, ACTING ADMINISTRATOR, OFFICE OF INFORMATION AND REGULATORY AFFAIRS, OFFICE OF MANAGEMENT AND BUDGET


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POST-HEARING QUESTIONS AND RESPONSES FOR SALLY KATZEN, PROFESSOR, 

UNIVERSITY OF MICHIGAN LAW SCHOOL


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POST-HEARING QUESTIONS AND RESPONSES FOR CURTIS W. COPELAND, PH.D., SPECIALIST IN AMERICAN NATIONAL GOVERNMENT, CONGRESSIONAL RESEARCH SERVICE


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POST-HEARING QUESTIONS AND RESPONSES FOR PAUL R. NOE, PARTNER, C&M 

CAPITOLINK LLC, AND COUNSEL, CROWELL & MORING ENVIRONMENT & NATURAL

RESOURCES GROUP WITH ATTACHMENTS


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POST-HEARING QUESTIONS AND RESPONSES FOR PETER L. STRAUSS, PROFESSOR, 

COLUMBIA UNIVERSITY SCHOOL OF LAW


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Æ


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