RAA: The end of accountability as we know it

Who doesn’t like the concept of accountability?  We instinctively understand that people and organizations should be accountable for their behavior.  Politicians and government should be accountable for their words and actions. 

Accountability is as American as mom and apple pie--except when it is just a phony adjective as in the Regulatory Accountability Act (RAA) being considered by Congress.

The first warning that the RAA is just a bogus use of the word “accountability” is who is supporting the legislation.  There are well over 30 bills in Congress right now that have the stated purpose of stopping regulations in one fashion or another.  And these bills have something else in common—they all have the same Congressional supporters and these supporters also support the RAA. 

So how does a bill with the word “accountability” in its title really strive to stop regulations and produce less accountability?  And why is that bad for small and mid-size businesses?

The RAA throws over 60 years of procedures for government agencies making deliberate, thorough, publicly crafted regulations out the window.  In exchange it gives the real power to lobbyists for big corporations and the courts to make decisions on carrying out, or more likely not carrying out, the will of our elected officials.

The RAA does this by micro-managing every step of the rulemaking process.   According to a report released this week by the Coalition for Sensible Safeguards, Impact of the Regulatory Accountability Act, the RAA adds more than 60 new procedural and analytical requirements.  K-Street lobbyists will have more time and opportunity to practice their special-interest influence.  The RAA, says the report, “would add no fewer than 21 to 39 months to the rulemaking process”, a process that can already take years.  As a result the RAA will dramatically increase the cost to taxpayers for the regulatory process and never produce the results envisioned in the federal laws passed by Congress.

The RAA is also a corporate attorney’s dream.  Every aspect of the RAA is geared toward encouraging special interests to legally challenge every regulation of an agency.  Even frivolous lawsuits are protected under the bill because the RAA defines as "substantial evidence" for a lawsuit to be anything the special interest thinks is "reasonable."

The 32-page RAA mentions judicial review, litigation, the court and other lawsuit terminology 18 times. The bill even includes a provision guaranteeing "immediate judicial review" for any special interest on every aspect of the prescribed rulemaking process.   If any regulation can survive this legal quagmire, it will deliver nothing that resembles the intent of our elected leaders.

With the federal regulatory process shut down, accountability of big corporations is gone.  These corporations, and especially multinational corporations, will have more freedom to pursue their profitability without regard to the effect on the American public’s health and safety.

Small and mid-size businesses won’t stand a competitive chance against the deep pockets of corporate giants unleashed from regulatory control.  Access to capital will diminish even more and protection from financial predators will decrease.  With no accountability for big corporate American, small and mid-size businesses will suffer.

That’s why the American Sustainable Business Council, Main Street Alliance and Small Business Majority are opposing the RAA.  It is an “accountability” fraud on the American public and the real businesses that have made this country great. 

Regulatory reform good for multinationals, yet bad for you.

The Hill's Congress Blog

November 1, 2011

By Frank Knapp Jr

 

The Regulatory Accountability Act of 2011 (RAA), a bipartisan bill introduced in the House and Senate, portends to offer common sense rules to affect how Federal agencies analyze costs and benefits. The bill provides extensively detailed procedures for agencies in promulgating regulations that are projected to have a minimum effect of at least $100 million on the United States economy.

However, a thorough reading of the RAA leads to three conclusions. First, the bill will likely to dramatically drive up the cost of almost every rule-making process and budget of a federal agency. Second, federally elected officials will be stripped of their ability to responsibly lead our country. And third, the RAA is a highway to never-ending lawsuits by special interests against the federal government.

The RAA is designed to micromanage every federal agency in its efforts to create rules necessary to carry out legislation passed by Congress.

By doing so, it turns over 60 years of effective regulation promulgation under the Administration Procedures Act into a protracted process that will stretch the time needed for rule-making into decades. Federal agency budgets will need to be expanded by hundreds of billions of dollars to comply with the RAA and perform their usual functions of protecting the public and small businesses from unsafe products and practices.

Congressional and presidential governance will be replaced by bureaucratic decisions designed to appease special interests. Elected leaders will be turned into figureheads whose every effort to exercise the will of the voters will be thwarted by the will of government bureaucrats, special interests and the courts.

Finally, the legislation is a corporate lobbyist dream. It appears to have been written by corporate attorneys for corporate attorneys.

Every aspect of the RAA is geared toward encouraging special interests to legally challenge every regulation of an agency. Even frivolous lawsuits are protected under the bill because the RAA defines as "substantial evidence" for a lawsuit to be anything the special interest thinks is "reasonable."

The 32-page RAA mentions judicial review, litigation, the court and other lawsuit terminology 18 times. The bill even includes a provision guaranteeing "immediate judicial review" for any special interest on every aspect of the prescribed rule-making process. Even the decision by an agency that a rule will not meet the minimum $100 million threshold can be challenged in court, making the developing of any rule subject to the extensive and expensive rule-making process prescribed in the RAA.

There is no way to describe the RAA in any other simpler terms than to call it what it is—a budget-busting, anti-democracy, Corporate Attorneys Full Employment Act.

It is no wonder then that supporters of the RAA are primarily U.S.-based multinational corporations. Increasing the cost of government for taxpayers is not a concern to these corporations that use offshore tax havens and other deceptive accounting practices to avoid paying their fair share of U.S. taxes. If federal agency budgets must be increased because of the RAA, it won't be the multinationals footing the bill.

The multinationals have no allegiance to government and democracy. Their shareholders and corporate executives are the only flags they salute. A diminishing of our democratic governance only serves to give the multinationals more power.

The only authorities these multinationals recognize are the courts. With their enormous wealth, multinationals eagerly pay expensive corporate attorneys to delay, change or kill any government regulation that stands in their way of profit. This means that the RAA threatens every American citizen's health and safety.

In regard to the No. 1 issue today, jobs(other than corporate attorney jobs), the RAA will create none in the private sector. Instead, it endangers the well-regulated marketplace essential in establishing fair competition between small, mid-size and big business. The RAA will allow big business to push smaller competitors out of the marketplace, thus killing jobs.

The RAA is not just bad legislation. It is extremist legislation designed to protect the very entities from which the rest of us need protection-multinational corporations.

Knapp is vice-chair of the American Sustainable Business Council and president of the South Carolina Small Business Chamber of Commerce.

Source:
http://thehill.com/blogs/congress-blog/judicial/191015-regulatory-reform-good-for-multinationals-yet-bad-for-you

Collins' 'time-out' not the right call

By Nate Libby, Special to the BDN

Posted Oct. 04, 2011, at 5:41 p.m.

Small-business owners know what’s happening in our communities because we serve and employ the workers who make our local economies thrive.

Here in Maine, where the majority of workers either own or work for a small business, the perspective of small-business owners could be considered a thumb on the pulse of Maine’s economy. My organization, the Maine Small Business Coalition, counts 2,500 businesses among its ranks. Our members feel the impacts of policies that affect small business every single day.

Too often, we hear arguments for “business-friendly” policies that don’t match up with our experience — mostly coming from big-business lobbyists who claim to speak for our interests. The latest example is the “business” support for Sen. Susan Collins’ “regulatory time out” and “regulatory accountability” proposals.

These proposals are being touted as some kind of magic panacea for whatever ails America’s job creators. Sen. Collins has used these calls for regulatory roll-backs as the basis for the GOP rebuttal to last weekend’s radio address by President Obama and for an OpEd in the Wall Street Journal.

Take the “time out” proposal, which puts a freeze on new health and workplace safety rules or standards. When a football team calls a time-out, play stops on the field. But that’s not what Sen. Collins is proposing at all. She is proposing to let big polluters, big banks and big insurers keep playing their games, but to take the officials out of the game so they can’t throw flags on penalties.

Who wins in that situation? The big guys do. And who loses? The little guys. Big polluters and big bankers get to do an end run around the rules, and small businesses get to pay the price in lost productivity, higher health care costs and a sputtering economy.

Sen. Collins’ other proposal, the “regulatory accountability act,” is even more deceptively named — and more of a threat to the standards that help create a level playing field for small businesses. This bill wouldn’t just freeze new standards — it would undermine long-standing ones we’ve come to count on. That doesn’t encourage “accountability,” it encourages big corporate players to start a race to the bottom.

Small businesses depend on sensible standards and reasonable rules to create the foundation for business success. Consider the recent work of the Maine Small Business Coalition:

• 1,476 of our members wrote to the Maine Legislature asking lawmakers to oppose LD 1333, the new health insurance law, because of this legislation’s deregulation of the insurance industry. As its rules take effect in October, we are starting to see rural Maine businesses feeling the pinch, some seeing premium increases of over 80 percent from last year.

• Just under 250 of our members signed on to support the Kid-Safe Products Act, a much-needed safeguard on the chemical industry, to protect our customers and our neighbors from exposure to toxic chemicals in everyday products

• More than 100 business owners wrote personal letters to Sens. Snowe and Collins asking them to lead on closing off-shore corporate tax havens, a major source of lost revenue and a prime example of how regulations serve the purpose of level the playing field for all businesses.

Sen. Collins and her colleagues need to understand that Maine small businesses don’t want Congress to sit on the bench and do nothing while the clock ticks down and the economy sinks back into recession. We want Congress to get off the sidelines, get in the game and tackle the real problem — restoring our customer base.

A “time-out” on regulations means a free-for-all for corporations; we should be demanding accountability just as much from corporations as from our government. Congress should get to work rehiring teachers, investing in infrastructure and injecting money into our local economies so small businesses can do what we do best: create jobs and serve our communities.

Nate Libby is director of the Maine Small Business Coalition, a coalition of 2,500 business owners whose mission is advocacy for small businesses and investment in the local economy. Its website is www.mainesmallbusiness.org.

http://bangordailynews.com/2011/10/04/opinion/contributors/collins%E2%80%99-%E2%80%98time-out%E2%80%99-not-the-right-call/

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Sam Blair

Main Street Alliance

sblair@mainstreetalliance.org - (603) 831-1835