Al Armendariz's 'Crucify' Slip Reveals EPA's True Nature

Armendariz's comments are a glaring blemish on the administration's attempts to paint a "happy face" on its regulatory zeal.

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Pete Sepp is executive vice president of the National Taxpayers Union.

Few can deny that former Environmental Protection Agency regional administrator Al Armendariz's comments implying the agency could "crucify" private businesses with regulatory enforcement were tactless. More importantly, however, his harsh words, the fallout of which culminated in his resignation this week, offer a glimpse behind the curtain on the administration's approach to policy. And they point out larger fundamental changes beyond one official's departure that are needed to clear away the thicket around the regulatory system that is entangling job creators.

As our economy continues to struggle to regain momentum, the administration should be focused on creating an environment of growth and investment. Unfortunately, its prerogative seems to be one of intervention and intimidation. Across nearly every industry, policymakers have demonstrated an inclination to subjectively pick winners and losers in the marketplace, especially toward the energy sector. One doesn't need to look far to realize Uncle Sam is a poor player in this arena, as my colleague Nan Swift has been pointing out in the recent debate over reauthorizing the Export-Import Bank.

[See a collection of political cartoons on the economy.]

The president's energy policies have in reality killed job-creating projects, denied robust offshore production, and hamstrung domestic economic development. At the same time, tax policies have decreased U.S. competitiveness abroad. And despite anemic job creation, agencies continue to hobble private businesses with increasingly complex and numerous regulations.

The president's core message has long been one of change and reform. In a State of the Union Address he noted, "There's no question that some regulations are outdated, unnecessary, or too costly… I've ordered every federal agency to eliminate rules that don't make sense." But change doesn't come from statements alone—it needs action to back it up. On the tax front, for example, National Taxpayers Union's 2012 "Taxing Trend" study reported that the paperwork burden on the public attributable to the U.S. Treasury is 6.4 billion hours, or more than 70 percent of the entire federal government's regulatory compliance imposition.

[See a collection of political cartoons on energy policy.]

Rather than looking for ways to correct misguided fiscal and regulatory policies, the administration has redoubled its efforts to sell them. One particularly cunning tactic it's used is manipulating the costs and benefits of new rules to distort their value. Earlier I wrote about the EPA's Clean Air Act, which the agency touts as creating a 90-1 rate of return on costs. What Environmental Protection Agency's spin obscures is the calculations behind those figures, notably that the measurements are based on hypothetical valuations to mask the tangible harm to jobs and competitiveness.

Mr. Armendariz's comments are a glaring blemish on the administration's attempts to paint a "happy face" on its regulatory zeal. But instead of brushing them aside, this is an opportunity for the president to commit to real reforms.

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There are a number of very practical measures he could take to signal to the business community that he's on their side. Encouraging greater public input throughout the rulemaking processes; standardizing scientific measures and methodologies across agencies; subjecting new rules to economic review—all are examples of sensible steps that would add greater transparency and accountability to the policymaking process.

As we approach the elections this fall, voters will be watching the economy closely. If the administration's record is any indication, there will be no shortage of spin about the work it's done. Last week's revelation from the agency may have been dismissed as a slip of the tongue, but it's much harder to dismiss the policy slips that continue to leave our economic recovery on an uncertain footing.

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