Midnight Regulation: Decisions in the Dark

September 6, 2012

The phenomenon of "midnight regulation" occurs when the federal government passes a series of new regulations in the last quarter of a presidential year. The number of new regulations is especially high when the control of the presidency switches parties, says Jerry Ellig, a senior research fellow at the Mercatus Center.

Ellig found that rushed midnight regulations -- those that were passed after a self-imposed deadline of June 1 -- tend to be more costly and ineffective than other regulations. For over three decades, executive orders have mandated that federal agencies conduct regulatory impact analyses (RIAs) to assess the quality and impact of a new regulation.

In the case of midnight regulations, there tends to be lower quality RIAs and an unwillingness by agencies to use the analysis. The Mercatus Center's Regulatory Report Card looks at openness, analysis and use of regulations to care midnight and non-midnight regulations.

  • Regulations proposed after June 1, 2008, under the Bush administration have lower quality and use of analysis than regulations proposed in 2008, 2009 and 2010.
  • Rushed midnight regulations are an average of 4.3 points worse on the Report Card than non-midnight regulations.
  • Similarly, non-rushed midnight regulations also score lower than ordinary regulations.

The lower quality of these regulations can be explained by the influx of new regulations in a short amount of time, which overwhelms the Office of Information and Regulatory Affairs (OIRA) and inhibits its ability to conduct meaningful oversight. Furthermore, agencies are less willing to take into account the RIAs when implementing the new regulations.

There are several reforms the current administration can take to address the concerns of midnight regulations.

  • First, self-impose restraints such as deadlines like the Bush administration did. This would improve the quality of analysis and prevent agencies from rushing to get in all the regulations.
  • Secondly, limit the volume of regulations during the midnight period. Reviewing fewer regulations would allow the OIRA to conduct high-quality analysis, which agencies are more likely to take into consideration.
  • Finally, establish a judicial review of RIAs. This would allow the judicial branch to look at the RIAs, thus giving agencies an incentive to conduct high-quality analysis.

Source: Jerry Ellig, "Midnight Regulation: Decisions in the Dark," Mercatus Center, August 28, 2012.

 

Browse more articles on Government Issues