Monday, May 11, 2009

Preening, Pruning, and Getting Serious About Regulatory Review

In tomorrow’s hearing on Cass Sunstein’s nomination to head the Office of Information and Regulatory Affairs, we are sure to see some preening. The right opposes him for what he has argued on behalf of animal rights. The left opposes him for championing cost benefit analysis. (Bentham would cheer the President for this one, no doubt.) Sunstein’s offended just about everyone at some point in his long, distinguished career (funny how being a good academic will do that). Last year he argued that a President Obama ought not investigate or prosecute torturers while elsewhere arguing that states should shift to presuming consent to organ donation at death for all persons who don’t explicitly opt out. And so on.

All of this would be good for a laugh if it didn’t involve one of the most important jobs in the world. OIRA is poised to become even more of a force in global risk regulation as we confront climate change, health care reform, and a suite of other potentially catastrophic public problems throughout this Administration. What should the hearing focus on?

As I’ve argued before, we need to begin the much more detailed and difficult work of optimally standardizing cost benefit analysis—or, more accurately, risk/benefit analysis. Modernizing and standardizing risk/benefit analysis (RBA) is a process in which OIRA could play a big role. Teaching agency officials, refining the standard techniques to reflect informational and cognitive deficits, and expanding risk/benefit quantifications to make them sensitive to distributional disparities are all tasks on which OIRA has real advantages.

Ultimately, though, much of the developmental work this will entail must be done by others. Valuing, for example, the “ecosystem services” that healthy landscapes provide is not something OIRA can do. Assuming that such valuation can be done reliably (and I have doubts, I confess), it will be done by the many minds now out there inhabiting and living off of such landscapes today. It will be done by the many “action” agencies that constantly confront regulated parties, state and local governments, peers from other nations, and by courts as they review the rationality of particular actions in context. It entails, in short, panoptic awareness of information that is so widely dispersed in its natural state that it’s been ignored in regulatory review as we know it.

This suggests that OIRA has some serious institutional evolution ahead of it: transitioning from an inward-dwelling tyranny of desk-drivers to an outward-facing network hub. As such, it would work to optimize a connected whole of administrative decision-making, monitoring and searching for “activity motifs”—inferential chains that are over-represented in the network. Once found, these pieces could be replaced with standardized versions whenever the characteristic work is being done redundantly and some kind of modularity is appropriate. This would be attractive to action agencies if OIRA provided payoffs for adoption of its modules because it would allow an action agency to prune their own decision trees and speed their internal review processes. The modularity would be attractive to (most) third parties because it would enhance the transparency and predictability of agency decision-making and eventually facilitate cross-program comparisons by standardizing their logical and arithmetical guts.

Senator Lieberman’s Committee ought to engage the nominee on this transformative agenda for OIRA tomorrow morning because OIRA’s span of control is almost as broad as Congress’s own vast record of delegated discretion. OIRA today is the paradigmatic 21st century agency: fingers in everything, master of nothing, coupled to virtually every other agency through a myriad of pathways and, yet, owner of its own data silos. Rethinking the whole thing and reimagining it as a network of information collection, organization, and delivery would be truly transformative for, in the end, the value of CBA (or RBA) comes down to the information behind it. And improving that should be the goal of a publicly-oriented Congress. It remains to be seen whether we have one.

Posted by Jamie Colburn

8 comments:

Ricky said...

Very interesting post, but beyond my experience. Can you explain how OIRA could/would provide payoffs for the adoption of its "inference modules," as it were?

Jamison Colburn said...

Simple. OIRA could offer a "presumption of validity" to any action agency adopting its preferred methods in some given analytical leap. This would be a real payoff, as I understand it, because a lot of action agencies find the OIRA review process tedious and unpredictable, especially given the need to justify actions to two different masters (OIRA and the Article III courts). The presumption would only have to be a presumption, though.

Ricky said...

Makes perfect sense, thank you. Do you happen to have an online resource or two to which you point people wanting to learn more about the structure/functions of the OIRA? This is quite an interesting area.

Jamison Colburn said...

Hmmm. I know that NYU's "Institute for Policy Integrity" has done a lot of reporting on the OMB reform effort and that they've also put together some pretty nice reports on their own. Check it out here: http://www.policyintegrity.org/projects/FederalRegulatoryReview.html.

Cheers.

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