Ignoring Cost/Benefit Analysis Order
During his presidency, Bill Clinton issued Executive Order 12866, which requires federal agencies to undertake “an assessment, including the underlying analysis of costs and benefits of potentially effective and reasonably feasible alternatives” during the rulemaking process. The order was endorsed by President Obama, but the EPA under his administration has frequently ignored this directive and stymied attempts to discover the justification for its rulemaking.
The EPA projected that its rule regulating emissions from cars and light trucks (Tier 3) will cost the U.S. roughly $3.4 billion annually—one of the EPA’s costliest directives ever. However, when considering how best to regulate these emissions, the agency failed to identify or evaluate any alternatives to the eventual final rules in direct contradiction to the executive order.
Since the agency also failed to analyze the net benefits of the new tailpipe standards enacted to reduce vehicle emissions, the full impact of the regulations remain unknown. As scholars from Resources for the Future pointed out, “it is possible that the tailpipe standards, which the EPA estimates will increase car costs by $710 million in 2017 and more than $2 billion in 2030, could yield negative net benefits because reductions in some urban nitrogen-oxide emissions will likely raise public health risks.” A costly EPA regulation could actually raise health risks rather than improve public health.