With the hotly contested election behind us, it’s now officially midnight in Washington. The “midnight period” is the time between Election Day and Inauguration Day, which has historically seen a surge in last-minute regulation by the outgoing administration. The surge is particularly pronounced when the party controlling the White House is set to change—as with this election.
To combat the surge, the House Judiciary Committee recently approved the “Midnight Rules Relief Act,” which would make it easier for Congress to disapprove recently finalized regulations. While useful, the bill treats just one symptom of a much larger problem. A better solution would be to enact comprehensive regulatory reforms that would allow agencies to adopt only those regulations that solve real problems at a reasonable cost.
Midnight regulations are an especially egregious example of poorly thought-out regulations. Like zombies, they live on long after the demise of the administration that created them. Once finalized, regulations are often difficult to modify or repeal. Agencies may also use the midnight period to push through controversial rules because they have little to fear from congressional scrutiny and oversight.
Consider, for example, a National Highway Traffic Safety Administration (NHTSA) regulation proposed in 2013 that would require hybrid and electric motor vehicles to produce a minimum amount of noise to avert accidents with blind or vision-impaired pedestrians and bicyclists. Protecting the blind and vision-impaired from “silent but deadly” hybrid and electric vehicles is a worthy goal.
But the agency’s estimate of the number of accidents prevented assumes that blind people ride bicycles in traffic in the same large numbers as people who are not visually impaired. Given that the benefits of the regulation are likely smaller than claimed, the NHTSA should have considered more cost-effective alternatives targeted at protecting blind and vision-impaired pedestrians.
Another regulation under development for a long time is an Occupational Safety and Health Administration (OSHA) regulation intended to prevent people from tripping, slipping, and falling at work. This regulation was proposed in 2010. Yet the agency’s own analysis notes that greater compliance with existing regulatory standards could prevent a lot of accidents, which suggests that the real solution may simply be better compliance with regulations already on the books, rather than new regulatory requirements.
Finally, the Department of Homeland Security proposed in 2011 to take over regulation of the sale and transfer of ammonium nitrate, a fertilizer that can be used to make bombs. The department would require all buyers to obtain a federal verification number and require sellers to check buyers against a terrorist database. DHS acknowledges that states already regulate ammonium nitrate sales, and the industry has voluntarily adopted a “know your customer” program to ensure that sellers know the identity of buyers. The department simply asserted that these measures are insufficient without providing evidence.
These are not isolated examples. A study conducted by one of us (Ellig) found that midnight regulations are accompanied by a much less thorough assessment of whether a significant problem actually exists that would justify issuing a regulation in the first place.
Furthermore, many agencies fail to provide the information necessary to evaluate whether the benefits of regulations justify the cost they impose on the American public. For example, of 39 proposed economically significant regulations (regulations with an impact on the economy that exceeds $100 million), which could be finalized during the midnight period, only 25 regulations include estimates of both benefits and costs.
For the 14 regulations lacking a benefit or cost estimate, it will be especially difficult for regulators, members of Congress or the public to tell whether they do more good than harm.
Midnight regulations illustrate a larger problem: Agencies often issue major regulations without strong evidence that the regulation is necessary or that the benefits exceed the costs. Ultimately, we need to reform the regulatory process to require that agencies get the facts before they regulate. Otherwise, prepare for a zombie regulatory apocalypse every four years.