Recent studies have shown preliminary evidence of a tendency for outgoing administrations to generate a flurry of last-minute regulatory activity. This so-called Cinderella effect is described as resulting from the combination of an administration being in power yet, because it is out-going, not being subject to political ramifications from its actions. In this paper, we look at monthly regulatory activity over the past 30 years and compare the baseline growth in regulations (measured using the proxy of pages in the Federal Register) to the growth immediately following a Presidential election when the sitting President is re-elected, not re-elected, and when the party in control of the White House changes. We find significant evidence supporting the existence of a Cinderella effect.

On February 13, 2009, President Obama signed into law the American Recovery and Reinvestment Act (ARRA), with the promise that this $787 billion stimulus would “create or save” 3.5 million jobs over the next two years, mostly in the private sector. The basis for the law was a study by Christina Romer, the Chairman of the Council of Economic Advisors, and Vice-President Biden’s chief economist Jared Bernstein, who warned that without an economic stimulus, unemployment would reach 9 percent by the end of 2010.

In this publication, Veronique de Rugy presents a case example of how government can link strategic risk management to resource allocation. Dr. de Rugy uses port security as an example of how strategic risk management can be used to analyze threats to the nation, develop scenarios, pose key questions, and develop resource allocation options. To illustrate the potential of strategic risk management, she presents three resource allocation options as to how the federal government might reallocate its present resources to more cost-effectively respond to security threats to the nation based on risk analysis.

This issue of Local Knowledge focuses on the role of nonprofits and social entrepreneurs in rebuilding the Gulf Coast. In this issue you can read research articles that explain what social entrepreneurship is; that discuss how social entrepreneurs and nonprofits play a critical role in the response to and recovery after disasters; and that detail where and when nonprofits have played key parts in rebuilding.

In this Mercatus Policy Series, Senior Research Fellows Veronique de Rugy and Jerry Brito provide an extensive analysis of midnight regulations. In addition to examining the motivations and circumstances behind this phenomenon, they address trends of regulatory activity, review the regulatory process, and discuss how midnight regulations can be mitigated in the future.