Cutting red tape

Following up on a draft released in May, the Obama administration Tuesday outlined federal rules changes that it says will save private businesses about $10 billion over five years.

Great. This is movement in the right direction, and the president is to be congratulated for acknowledging the regulatory environment is a big part of what’s blocking more job creation. The question is whether this reflects any real change in the regulatory mind-set, down the line.

For instance, while the White House was crowing about regulatory relief, the EPA is still proposing to tighten ozone standards, which could cost the economy an additional $1 trillion annually between 2020 and 2030 and jeopardize 7.3 million jobs.

And let’s look at just one specific example of this regulatory overhaul, a rule change by the Energy Department that reportedly “may save makers of commercial appliances and bathroom shower heads as much as $900 million.”

In July 2010, The Wall Street Journal reported, “Regulators are going after some of the luxury shower fixtures that took off in the housing boom. Many have multiple nozzles … and emit as many as 12 gallons of water a minute. In May, the DOE stunned the plumbing-products industry when it said it would adopt a strict definition of the term ‘shower head’ in enforcing standards that have been on the books — but largely unenforced — for nearly 20 years.”

For years, each nozzle in a shower was considered separate and in compliance if it delivered no more than the 2.5-gallon maximum, the Journal reported. But in May 2010, the Energy Department introduced a new interpretation under which all nozzles would count as a single shower head and be deemed noncompliant if, taken together, they exceed the 2.5 gallons-a-minute maximum.

Last year the Energy Department fined four shower head makers $165,104 in civil penalties, alleging they failed to demonstrate compliance for some devices.

Manufacturers and retailers warned the new rules also affect hand-held sprays used by the elderly and disabled. Multiple shower heads found in shower rooms at schools or gyms could also be at risk, manufacturers say.

“Did Congress limit consumer choice? Absolutely,” DOE General Counsel Scott Blake Harris told the Journal.

So what about the Energy Department shower-head rule change announced Tuesday?

The agency has now decided to “provide an enforcement grace period of two years to allow such manufacturers to sell any remaining non-compliant products … in order to enforce the existing standards in a manner that avoids needless economic dislocation that some industry representatives estimated at $400 million.”

Not really a rule change, then, but a two-year grace period before those who spent time and money developing these successful products will have to lay off anyone still manufacturing, distributing or selling them.

It’s hard to believe the Founding Fathers contemplated a central government large and intrusive enough to regulate our toilets and our shower heads — fining and driving out of business not those whose products don’t work, but rather those whose products work too well. And so long as Washington endeavors to do so, it’s hard to work up high hopes for this administration’s version of “slashing the red tape.”

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