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Republicans are Using an Obscure Law to Roll Back Privacy Protections, Anti-Bribery Rule

Emily Stewart

Republicans are using a Clinton-era legislative tool to roll back rules on internet privacy protections, bribery prevention and waterway protection, and they're going after state-sponsored retirement plans, too. And they're proud of it.

White House legislative affairs director Marc Short in a press briefing on Wednesday touted the GOP's use of the Congressional Review Act to roll back Obama-era regulations as a "story that has not been told." Thus far this year, 11 Congressional Review Act resolutions have made it through Congress and been signed by President Trump to undo the previous administration's rules.

"This is a huge accomplishment in the first quarter," Short said.

The Congressional Review Act is a 1996 law shepherded by former House Speaker Newt Gingrich that allows Congress to review federal regulations and, by joint resolution, overrule those regulations within 60 legislative days of their enactment. And when those regulations are overruled, it's extremely difficult to get the same thing back in place again -- ever.

Trump has already signed nearly a dozen such resolutions, and others are in the pipeline and headed to his desk before the window closes on April 28. 

Perhaps the most headline-grabbing such resolution so far was this week, when Trump signed a bill scrapping a rule that would have required internet broadband providers including Comcast , Verizon and AT&T to get customer approval before marketing their information to a third party. Progressive groups maligned the move as a favor to corporate America.

Trump and Congressional Republicans used the act to roll back an SEC rule requiring energy companies to disclose payments to foreign governments in February. Aimed at curbing bribery, the Dodd-Frank mandated rule was fiercely opposed by the oil and gas industry and could have cost companies upwards of $500 million in compliance costs.

The GOP has also used the CRA this year to undo the contractor "blacklisting" order requiring federal contractors to disclose labor law violations and the "stream protection rule" restricting coal companies from dumping mining waste into streams and waterways.

A number of members of the Republican Party have jumped on the opportunity to introduce resolutions under the CRA. Senator Jeff Flake (R-AZ) introduced the internet privacy resolution. Representative Bill Huizenga (R-MI) and Senator Jim Inhofe (R-OK) put forth a joint resolution on the extraction rule. Representative Bill Johnson (R-OH) introduced the resolution on the stream protection rule.

Representatives Francis Rooney (R-FL) and Tim Walberg (R-MI) have introduced separate resolutions to roll back Department of Labor rules opening the door for states to design and operate retirement savings programs for private-sector employees, both of which are making their way through Congress now. The White House has said it strongly supports the resolutions -- in other words, the president will sign.

A full list of the regulations being targeted under the Congressional Review Act and where they are in the legislative process is provided by the George Washington University Regulatory Studies Center here.

Short on Wednesday said that the CRA resolutions thus far have resulted in a cost benefit to the economy of $10 billion and emphasized that the focus of many has been on creating jobs. He acknowledged that the rollback of the FCC internet privacy rule was not a job-creating effort.

"Some of the CRAs are not specific to jobs, but many of them are," he said.

The Trump administration and Congressional Republicans have struggled to move on major legislation such as health care and tax reform thus far in the president's tenure, and they appear to think the CRA will give them some legislative accomplishment to point to. When reporters on Wednesday asked Short questions on other matters, he sought to steer questions back to the CRA.

"I do think that this is a story that has not been told," he said.

Vice President Mike Pence addressing a CEO town hall on Tuesday gave a nod to the CRA and Congress' use of it. He said that in coming days, Trump will sign even more bills into law "rolling back that avalanche of red tape" from the Obama administration.

Pre-Trump, the Congressional Review Act had been used successfully only once, to roll back a Clinton-era rule from the Occupational Safety and Health Administration requiring employers to take measures to curb ergonomic injuries in the workplace. George W. Bush signed a resolution to disapprove the rule in March 2001.

"It's more important than people probably gave it credit for nine months ago when it had only ever been used once," said Philip Wallach, senior fellow at Washington, D.C. think tank the Brookings Institution.

A New Wrinkle on Timing

The Congressional Review Act allows for the review of rules within 60 legislative days (days Congress is in session) of their enactment. For Obama-era regulations, that has meant anything submitted to Congress on or after June 13, 2016.

The Obama administration made a push ahead of that date to get out as many regulations as possible, said Rena Steinzor, a law professor at the University of Maryland. After the election, it pushed to get rules through even with the understanding that Congress might very well seek to review them -- and find a favorable party for doing so in Trump.

"It was a calculated risk," Steinzor said.

Beyond the late-term Obama rules, there is a growing chorus on the right insisting that the Congressional Review Act could actually apply to regulations passed long before last June. They argue that if a rule is never formally submitted to Congress, it could be subject to revision.

The conservative-leaning Pacific Legal Foundation this year launched Red Tape Rollback, an initiative it hopes could lead to the elimination of hundreds of rules. They argue that the 60-day clock on rules don't start on the CRA until a rule is officially submitted to Congress, and agencies have been delinquent on compliance. They also say the CRA has an expansive definition of what counts as a rule and also includes guidance from agencies.

The Wall Street Journal's Kimberly Strassel in January described the idea as a potential "regulatory game changer."

"The Congressional Review Act says that no rule can be enforced unless it's submitted to Congress," said Pacific Legal Fund attorney Jonathan Wood. "This is an excellent tool for the administration to reduce regulation."

But not everyone agrees it's such a silver bullet.

Sam Batkins, director of regulatory policy at right-leaning think tank the American Action Forum, has identified five such regulations that could be subject to the CRA under this loophole, including a CFTC rule to incorporate swaps. "Right now, it's an exercise in finding the rules," he said.

He noted that it's not yet known whether the theory behind Red Tape Rollback would actually fly. "Ultimately, I think it's going to come down to a...study on what effectively means 'submitted to Congress,'" he said.

Short on Wednesday deflected a question on the theory.

Regardless of when the rules came about, it's also about how much time and political capital lawmakers want to spend on them.

"I don't think there are a bunch of lurking rules that have silently gone into effect and shouldn't be in effect and the Republicans are now going to clear the books of all of them," said Steinzor.

"How likely is that to become something that Republicans want to spend their floor time doing?" said Wallach.

No Do-Overs

The Congressional Review Act bars agencies from re-imposing the same or a similar rule after. The 2001 ergonomics rule has never come back. But with so many regulations making their way through the pipeline now, the "no do-overs" idea could be put to the test.

The act prohibits "substantially similar" rules from being issued again, but its definition on what that means is hazy. In other words, we're now in uncharted territory.

"If you think that sounds ambiguous, it's because it is, and no one really knows what that means," said Batkins.

The extraction rule presents an example of the quandary. The regulation is mandated under Dodd-Frank to be written by the SEC, which now in theory will have to go back to the drawing board to rewrite it. It's not clear what counts as not "substantially similar." 

"It can't be an enviable position right now to be a lawyer at the SEC when you have to thread the needle," said Batkins.

One former Capitol Hill staffer and legislative expert speaking on the condition of anonymity said that there are a lot of unknowns surrounding the CRA.

"Beyond a certain point, if a regulation should have been submitted and wasn't and the committee didn't make any request about it and this was now years ago, it might be held that Congress has let down its rights as it were," he said. "I strongly suspect that at least the parliamentarians would probably not go along with the indefinite revisability of regulations. But it's never been tested."

Editors' pick: Originally published April 6.

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