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Regulatory Recap | Sep 20, 2019
Alana Bevan, Mary Ann McNulty, and Samuel Whillans
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The Trump Administration seeks to prevent California from setting its own automobile standards, the FCC approves a merger that will create the largest television broadcaster in the United States, and more…
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The Trump Administration reportedly will revoke California's Clean Air Act waiver under which the state sets lower caps on passenger vehicle tailpipe emissions. Myron Ebell, director of the Center for Energy and Environment at the Competitive Enterprise Institute, reportedly applauded the Trump Administration, saying that "no state, not even California, has a right to set national fuel economy standards for all the other states." California's Attorney General Xavier Becerra stated that the president has "no basis and no authority to pull this waiver," and promised to file a legal challenge to any revocation of the state's waiver.
The Federal Communications Commission voted 3‒2 to approve a merger between Nexstar Media Group and Tribune Media Company that reportedly would create the largest television broadcaster in the United States. Commissioner Michael O'Rielly called the transaction a "win for viewers," citing increased efficiencies and the potential for improved news content. But Commissioner Jessica Rosenworcel, who dissented in the decision, criticized the Commission for relying on what she termed a "totally-outdated broadcasting standard" that "prevents us from having an honest dialogue about localism, competition, and diversity."
The Federal Energy Regulatory Commission announced that it will propose new rules that would ease burdens on utility companies that are required to buy electricity produced by small-scale energy generators. The new rules would benefit utilities by allowing them to sign variable rate contracts with small producers and expanding exemptions for utilities in competitive power markets. Commissioner Richard Glick, the sole Democrat on a divided Commission, criticized the proposed rule, saying he was "deeply concerned that the Commission has failed so far to show that certain aspects of its proposal satisfy our basic responsibilities under the law."
The U.S. Department of Agriculture (USDA) issued a final rule that will allow pork slaughterhouses to hire their own inspectors instead of using USDA inspectors. Julie Anna Potts, President of the North American Meat Institute, supported the regulation, stating that it "will allow plants who choose to participate an opportunity for food safety innovation." Thomas Gremillion, the director of Consumer Federation of America, argued that "higher line speeds, fewer inspectors, and no microbiological pathogen performance standards are a recipe for a food safety disaster" and cited research demonstrating widespread public opposition to the rule change.
The U.S. Court of Appeals for the D.C. Circuit ruled that the recent price increase for stamps is illegal because the Postal Regulatory Commission (PRC) failed to comply with the Administrative Procedure Act (APA). Judge Neomi Rao wrote that the PRC violated the APA "by failing to consider relevant statutory objectives and factors and declining to respond to significant public comments." Capturing the historical significance of the decision, Rao noted that "the American Revolution was fomented in part by ordinary people who objected to taxation through stamps."
New Mexico Governor Michelle Lujan Grisham announced a program, operated by the state's Higher Education Department and Public Education Department, to provide free college tuition for local residents who attend a New Mexico public institution. According to Governor Lujan Grisham, the program will make "college significantly more accessible to New Mexicans of every income, of every background, of every age." State Representative David Gallegos (R-N.M.) reportedly questioned where the state of New Mexico would find funding to support the new program.
The U.S. Department of the Treasury proposed new rules that would expand the authority of the Committee on Foreign Investment in the United States (CFIUS) to review financial transactions that affect U.S. national security interests. The proposed rules would empower CFIUS to block foreign investments that implicate critical infrastructure and technology or involve real estate located near U.S. military installations. "The United States welcomes and encourages investment in our country and our workforce," Treasury Secretary Steven Mnuchin said, adding that the proposed rules are intended to give "clarity and certainty" to investors.
In response to a lawsuit challenging a Virginia law requiring marriage applicants to disclose their race, Virginia Attorney General Mark Herring reportedly announced that applicants no longer need to state their race in order to receive a marriage license. The plaintiffs in the suit were denied marriage licenses after refusing to select a racial category from a list that contained outdated terms such as "Gypsy," "Aryan," and "Octaroon." Brandyn Churchill, one of the plaintiffs, called the announcement a "step in the right direction" but promised to "continue to challenge the constitutionality of the statute."
The House Committee on Oversight and Reform initiated an investigation into whether U.S. Department of Transportation Secretary Elaine Chao used her position to benefit Foremost Group, a shipping company owned by Chao's family and in which she holds shares. A letter to Chao from Committee Chair Elijah Cummings (D-Md.) cited media reports that she used her position to increase Foremost's profile with the Chinese government and gave formal interviews alongside her father to Chinese media while displaying the Transportation Department seal. The investigation also suggested that Chao defunded Transportation Department programs benefiting vessels bearing United States flags, with the potential to benefit Foremost as its ships fly exclusively under foreign flags.
WHAT WE'RE READING THIS WEEK
Forthcoming in the Harvard Environmental Law Review, Sandra Zellmer, Samuel Panarella, and Oliver Finn Wood of the University of Montana Law School argue that the U.S. Fish and Wildlife Service could use collaborative regulatory mechanisms across private and public sectors as a precursor to listing a species as endangered. Without these additional regulatory mechanisms, according to Zellmer, Panarella, and Wood, the chance of ever delisting a species and categorizing it as "recovered" become more remote. In fact, they note that the absence of any additional regulatory mechanisms beyond the Endangered Species Act could prove insurmountable for delisting a species.
The U.S. government can and should do more to monitor technology platform companies, Boston University School of Law Professor Rory Van Loo argued in a forthcoming article in the Vanderbilt Law Review. Despite growing concerns about the market power and privacy practices of digital platform companies such as Google and Facebook, regulatory monitoring of these companies is limited, according to Van Loo. Van Loo suggested that the apparent reluctance to aggressively collect data from platform companies may reflect fears that the U.S. government would use the data to increase surveillance of platform users and intrude on personal privacy. But the tradeoff between regulatory monitoring and personal privacy is illusory, Van Loo argued, and increased monitoring may be necessary to protect the public from privacy abuses in the private sphere.
A recent study by Yiwei Dou and Joshua Ronen of New York University's Department of Accounting and Geng Li of the Federal Reserve Board investigated the impact of the 2009 Credit Card Accountability, Responsibility, and Disclosure Act (CARD Act) on competition between credit card issuers. One consumer protection measure implemented by the CARD Act, the restriction of card issuers' ability to change interest rates on credit card debt, prompted industry complaints that the measure would impede competition between issuers. Dou, Li, and Ronen analyzed a data set of mail credit card solicitations to investigate the degree to which issuers responded to changes in rivals' interest rates. They concluded that responsiveness to rivals' interest rates decreased after passage of the CARD Act, resulting in less variation in rates across the market and an overall increase in costs to consumers.
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