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March 20, 1999

Mandates Information Act of 1999

By

Testimony before the Subcommittee on Rules and Organization of the House Subcommittee on Legislative and Budget Process Committee on Rules - United States House of Representatives

Mr. Chairman, Members of the Committee: Thank you for inviting me to testify on the Mandates Information Act of 1999. I am Angela Antonelli, Director of The Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation. The Heritage Foundation is a privately supported nonprofit educational, public policy research organization that receives no funds from government at any level. My testimony before you today reflects my own views and not necessarily those of The Heritage Foundation.

I will present some brief remarks, but ask that my full statement with appendix be placed in the hearing record.

Mr. Chairman, I applaud you for your continued commitment to improve the procedures and information Members of Congress have for evaluating legislative proposals and for conducting its daily business. The Mandates Information Act of 1999 is an example of such an improvement, and I strongly believe that it would contribute to better, more sensible, responsible, and accountable policy decisions. And it would do so by building on the successes of the first three years of the implementation of the Unfunded Mandates Reform Act (UMRA) of 1995.

With the passage of the Unfunded Mandates Reform Act, the 104th Congress responded to the outcry of states and localities to unchecked and costly federal mandates. The intent of Title I of UMRA is to give Members of Congress information about the costs of proposed new public- and private-sector mandates so they can deliberate such proposals more carefully before they take action. During 1996 and 1997, I studied the initial implementation of UMRA to determine how well the act was living up to Congress's intent. My research led me to conclude that the contribution of the Congressional Budget Office's (CBO) analysis of the cost of new mandates had resulted in Members seeking more information at an earlier stage in the development of their legislative proposals and that the information provided by the CBO often helped to produce more sensible policy outcomes. I am submitting for record two articles I have written that highlight these policy effects.

I have not been alone in this positive assessment of the effects of Title I of UMRA. As the CBO notes in its February 1998 report on the implementation of UMRA, the act "has increased both the demand for and the supply of information about federal mandates" and that "committee staffs and individual Members are increasingly requesting our opinion about whether the legislation would create any new federal mandates." Finally, the CBO also notes that its "experience suggests that UMRA has been effective in helping to curb the practice of imposing unfunded mandates on state and local governments." The CBO has reiterated these conclusions in a number of testimonies before Congress.

The success of UMRA in providing information and encouraging discussions about the effects of new mandates on the public has lead to a desire to build on this success by enhancing the information and making the procedures affecting the deliberation of private-sector mandates equivalent to those that currently apply to intergovernmental mandates. The Mandates Information Act of 1999, which would allow Members to raise points of order for private-sector mandates (as they now already can do for intergovernmental mandates) and direct the CBO to provide them with analyses of the impact of proposed mandates on consumers, workers, and small businesses (by examining its effects on wages, benefits, employment opportunities, and profitability), is intended to do just this.

As the CBO has reported to Congress, since 1996 more of the legislative proposals it has analyzed contained private-sector mandates, and a larger proportion of those mandates actually exceeded the current $100 million statutory threshold. And during 1998, the CBO noted the number of bills with new mandates-intergovernmental or private-sector-has increased relative to 1996 and 1997. Not surprisingly, in an era of fiscal budget restraint and in the face of being held to the spending caps in the Balanced Budget Act of 1997, the more hidden costs of private-sector mandates can become a politically appealing alternative to new government programs and higher direct taxes.

A proposal such as the Mandates Information Act represents an effort to bring the hidden costs of new mandates into the sunlight so that the public and its representatives can be better informed about the impacts of mandates in ways that are not obvious. This Congress has heard many times-and will continue to hear-from business owners who struggle to comply with dozens of federal tax, labor, paperwork, and other mandates. Too often, the best defense a small business owner has against the annual deluge of constantly changing mandates is simply not to grow-to stay small and to not create any additional new jobs (while existing staff just works harder and longer) just so the business can remain exempt from at least some of the mandates. Again, I refer you to my articles submitted for the record that highlight examples of legislative mandates and the effects they can have on slowing the investments in new technologies that could improve the quality of life and on reducing workers' income, which, in turn, has an impact on their health and well-being.

The health of our country's economy and, even more important, the desire to achieve the highest levels of investments in public health, safety, and environmental protections demands that Congress provide itself with the information and analysis to deliberate more carefully about the impact of new federal mandates. Those who argue the contrary-that such information and deliberations would threaten our health and well-being-choose to take the position that the current system-the way the federal government makes decisions and spends money-is protective enough. But what are they really defending? Bureaucracies that are accountable to no one; that demand and spend resources as though they were unlimited; and that fail to set priorities. And what are the real costs? The lives that could have been saved, but were not, because we were denied information that would have helped us to see what needed to be done versus what felt good to do.

As the consumer group Public Citizen observes on its Web site with regard to freedom of information,

The availability of this [federal government] information is important for several reasons. First, such information is necessary to inform the public about what the government is or is not doing with regard to matters of public concern. Access to such information is the lifeblood of democracy. Second, government records often contain facts that can be helpful to organizations, businesses, and individual citizens [emphasis added].

I could not agree more. The information available to Congress and the public through UMRA has proved helpful not only to policymakers as they consider new policies but also to organizations, businesses, and individual citizens, like me. And, ultimately, this strengthens our democratic system of government. All the Mandates Information Act of 1999 proposes to do is to give any Member the right to make the House devote just 20 more minutes to the consideration of a proposed new private-sector mandate with significant costs-a mandate that, down the road, could force a small business owner to work longer days because he had to cut back on staff to absorb the costs or drive a mother or father out of a much-needed job.

The problem of burdensome federal mandates is real. In 1996, states and localities reported on 200 separate federal mandates involving 170 federal laws, including labor, health, and safety. The concerns expressed included the costs, lack of flexibility, unreasonable standards, unreasonable implementation timelines, and the often overlapping and duplicative roles of those federal agencies that administer the laws. These problems still exist and demand attention, and they are problems for the private sector. The Mandates Information Act of 1999, as it amends UMRA, is just one tool Congress can give itself to make sure it thinks hard before adding new mandates that might make a bad situation even worse.

More information and analysis of the impact of legislative proposals, whether they be proposals to add new mandates or eliminate or modify existing mandates (and the information and analysis required must be identical for all of these types of proposals) would help Congress and further empower the public to debate and decide the best allocation of national resources. I strongly believe that a more informed, democratic process ultimately would give us a country capable of devoting more, not fewer, resources to the types of policies that would save more lives, improve the quality of our lives and our environment, and allow us to become more prosperous. A 1994 Harvard University study examines 500 life-saving interventions and concludes that we save 60,000 lives a year fewer than we should because of our inability to set priorities to protect the public from the most serious risks it faces.

Clearly, there is room for the federal government to do a better job. Many American families, unlike federal bureaucracies, are forced to set priorities every day. They work hard to manage family budgets and make decisions every day about how to allocate their resources in a way that maximizes their health and well-being.

Such proposals as the Mandates Information Act of 1999 are intended to give Congress and the public the very best information and analysis available about important decisions affecting our health and prosperity. I think most Americans expect their elected representatives to want to know ahead of time how proposed policies would affect their ability to ensure our country is working smart and getting the best return on its investment of national resources. I think most Americans would consider it risky and dangerous to the future of their children if you rejected research, analysis, and information that would allow you to work smarter and achieve higher levels of protection and a better quality of life for every dollar spent.

Thank you, Mr. Chairman. I would be happy to answer any questions.

Angela Antonelli is a former Director of the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation

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