If you breathe air, drink water, get paid overtime, or purchase energy-efficient appliances, your life has been touched by an obscure federal agency that I had the privilege of leading. The Office of Information and Regulatory Affairs (OIRA) is responsible for reviewing federal regulations before they are published to make sure the administration has accurately calculated the impact the regulations will have on the economy and, more importantly, on the people whose lives they will affect. The mission for this little agency, tucked within the Office of Management and Budget in the White House, ensures that it plays a critical role in holding the government accountable for real-world impacts of regulatory actions.
President Biden took a major step forward in ensuring that OIRA can effectively do its job — by issuing a new executive order directing the office to improve its assessment and communication of the impact of regulations. Most importantly, the new executive order and related guidance documents update the kind of data, science and information that OIRA uses. For decades, OIRA has been hamstrung by requirements to use economic models and data that are long out of date. In fact, the last significant update to federal rulemaking was back in the 1990s. This executive order is another step in the Biden administration’s commitment to bringing the best, objective science to everything the government does for the American people.
So, what does this mean in people’s everyday lives? It means that when deciding how to tackle the climate crisis, OIRA will make sure that agencies take into account the long-term benefits of regulations that lower carbon output. We imagine that most Americans want to know how the government’s actions will impact not only their lives in the next few years, but also whether the government is acting in a way to best protect their children, grandchildren, and great-grandchildren. Now, thanks to President Biden’s actions, OIRA will use advances in science to predict climate impacts to make sure that federal officials are making the best choices for the future of our planet.
These new rules also mean that government agencies will have to give more targeted information about who will bear the costs and receive the benefits of regulations. Now we’ll know if a new rule is going to produce a benefit for just a few people at the upper end of the economic ladder versus whether the benefits will be spread widely across the population. The same is true for costs. While a rule that is intended to raise wages for low-income workers might come with what looks like a big cost for employers, you might view that cost differently if you knew that it was going to be distributed in small impacts among many employers or only among very big, very profitable corporations. Think about it this way — a billionaire will value a dollar in benefits very differently than a single parent raising kids at a minimum wage job, so we should know whether rules are benefiting the billionaire or the worker.
Another innovation in President Biden’s executive order is the direction that agencies do more to take into account the benefits of regulations that may be hard to quantify in dollars. To be clear, the executive order still requires a rigorous cost-benefit analysis for rulemaking. But, it adds to that analysis an equally rigorous assessment of other benefits that no price tag can adequately describe. Under the current framework, it is difficult to consider impacts on civil liberties, human dignity or privacy. For example, a dollar amount cannot accurately convey what it means to a person who uses a wheelchair to be able to use the bathroom by themselves on an airplane because the FAA issued a rule requiring bigger restrooms. But under the new rules, agencies will have to share with the public all the important ways that a new regulation will make change in their lives.
With the challenges facing our country, President Biden’s executive order meets the moment and will allow the federal government to better serve the American people. I had the privilege and the joy of working with the dedicated public servants in OIRA and throughout the executive branch. We know that they want to make good decisions about how to address these challenges using good information. Modernizing the regulatory process will ensure that policymakers are using up-to-date analysis and that the public is fully aware of how government actions affect their lives. It’s what the American people deserve and expect from their leadership.
Sharon Block served as Acting Administrator of the Office of Information and Regulatory Affairs from 2021-2022. Block is currently a Professor of Practice and Executive Director of the Center for Labor and a Just Economy at Harvard Law School.