US regulatory panel ends; legacy is a letup in rules

The President's Task Force on Regulatory Relief, chaired by Vice-President George Bush, was quietly terminated on Aug. 11. The lack of public response to this move was in sharp contrast to the bright expectations that accompanied the establishment of the task force in January of 1981. The August action raises a question as to whether it is now appropriate to hold a requiem for regulatory reform.

As it turns out, this is not the easiest question to answer. To some degree, the demise of the task force may be viewed as an honorable discharge of its members. After all, they accomplished quite a few of the key assignments given to them. The panel reviewed the host of ''midnight'' rules that the outgoing Carter administration hastily promulgated - rejecting some, approving others, and requiring modifications in still others.

Most important, the task force developed and set in motion a continuing process for reviewing proposed federal regulations, subjecting the major rules to the rigors of benefit/cost analysis. As a result of this process, an estimated $10 billion of capital outlays has been saved, and the annual, continuing costs of complying with federal regulations have been cut by about $ 10-$11 billion. Although such estimates are inherently approximate, they surely indicate that the review process has ''teeth'' in it.

The main achievement in regulatory reform since January 1981, however, has involved not so much ''doing'' or ''undoing,'' but rather ''not doing.'' That is , for the first extended period in decades, the federal government has not launched a major new regulatory activity. In the terms of the old Sherlock Holmes story, the federal regulatory dog has not barked in 31 months.

It is the area of statutory reform that has been the source of greatest disappointment to the supporters of regulatory reform. Updating the Clean Air Act - which had been identified as the highest-priority change in the apparatus of social regulation - has not been accomplished. This has not, however, resulted from any lack of effort by the task force, especially the vice-president.

The sad fact of the matter is that, from the outset, the task force's efforts in the environmental area have been overshadowed by the controversial statements and actions of the secretary of the interior, James Watt. To a secondary degree, the former administrator of the Environmental Protection Agency (EPA), Anne Gorsuch Burford, also alienated many people in the environmental movement, including those who had previously avoided political controversies.

In any event, a political climate has been created in which there is little likelihood, at least in the short run, that any significant changes will be made in environmental legislation. There surely appears to be little public support for major departures from the status quo, especially for reducing the burdens imposed by the EPA. A national public opinion poll in April of 1982 reported that 58 percent of the sample surveyed agreed with this statement:

''Protecting the environment is so important that requirements and standards cannot be too high, and continuing environmental improvements must be made regardless of cost.''

That was up from 45 percent favoring the statement in September 1981.

All this seems to explain why the line of mourners at the task force's demise was so short. Yet, there may be good reason to believe that mourning the end of the task force is premature. First of all, the regulatory review process continues. But, perhaps far more important, changing economic conditions may result in yet another shift in public attitudes and support for such reform.

Looking back over the past two years, it is clear that this period coincided with a decline in the pace of new industrial construction. In such a situation, the obstacles to new facilities represented by the array of environmentally oriented regulatory hurdles is not a key factor in the course of the economy. But, in contrast, the coming year or two seem likely to be a time of industrial expansion. Thus, the thicket of environmental permits and approvals will once again become a serious obstacle to economic growth - and the public will likely react to that turn of events.

A new Task Force on Regulatory Reform might well be required in that new environment. Personally, I prefer the term reform to relief for a very basic reason. The fundamental concern is not necessarily to lighten the compliance burdens placed on business. Rather, regulatory reformers are motivated by the desire that the citizen-taxpayer-consumer receive the benefits of a more enlightened, more cost-effective system of regulation. Just as it is the consumer who receives the basic benefits of regulation, so it is the consumer who bears the ultimate costs. This explains, of course, why economists are so fond of benefit/cost analysis as a guide to a more effective regulatory regime. Such analyses do not ensure that the existing regulatory apparatus will be reduced, but that any change will promote a more efficient functioning of regulatory activity.

Also, the creation of a new task force should reflect the lessons of recent experience. At the outset, it was a useful coordinating device to appoint the same individual as both executive director of the Task Force on Regulatory Relief and head of the day-to-day analyses of proposed regulations performed in the Office of Management and Budget. If a new task force or other leadership group is created, however, the staff head should have a full-time position, focusing on setting the broad strategy for regulatory reform, and for taking the initiative in developing reform proposals. That should cover both legislation and executive rulemaking, and existing as well as proposed regulations.

The basic thrust of any new task force should be to design a regulatory system that meets the consumer's needs most effectively. No requiem is in order on efforts to make government work better.