Hearing Of The Senate Homeland Security And Governmental Affairs Committee - Nominations

Statement

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REP. LIEBERMAN: Good morning. The hearing will come to order. This morning the committee meets to hear the nomination of Cass Sunstein to be the administrator of the Office of Information and Regulatory Affairs, known widely -- at least here in this room -- as OIRA. OIRA is one of those government agencies that has a very low public profile, but exerts very great influence over the workings of our government and the daily lives of most Americans.

In Congress we pass laws that express our values, our aspirations. We draw lines between what is right and wrong, desirable and undesirable in those laws, but because we cannot foresee every circumstance in which the law will be applied, or every detail that the law wisely might include, we leave many of the details to the Executive Branch of government and to its regulatory authority.

For over a quarter of a century, presidents have asked OIRA to help oversee and coordinate this regulatory process. And over those years, we have seen how OIRA has helped the regulatory agencies protect the American people, and we, in my opinion, have seen how OIRA has helped the regulatory agencies place hurdles in the way of helping the American people, sometimes blocking their efforts to fulfill their statutory responsibilities.

Based on the record of the Obama Administration, at least for these first 100 days, plus a little bit, I'm optimistic that our new President and his Administration will develop a regulatory agenda, forceful in its intent to protect the American people, and to do so in a way that is transparent. In Professor Cass Sunstein, the President has found someone with exceptional qualifications and extraordinary talent, clearly capable of leading OIRA in a positive direction to strengthen the Administration's efforts and intentions and to fulfill Congress's intentions, as stated in the law.

When Professor Sunstein began teaching at Harvard Law School in 2008 after a long and distinguished career at University of Chicago Law, his new employers announced that they had hired -- and I quote -- "the preeminent legal scholar of our time, the most wide-ranging, the most prolific, the most cited, and the most influential," end quote. This must have come as unsettling news to the many other members of the Harvard Law -- (laughter) -- faculty, who felt that they -- (laughs) -- were exactly that. But those were the words of Elaina Keegan (ph), then dean of Harvard Law, now the solicitor general of the United States.

Over your career on both -- in the short time at Harvard and also at Chicago, you have written extensively about regulation, the management of risk, indeed, about OIRA itself. I'm sure that you would agree with me that the regulatory agencies of the federal government face a series of very significant challenges, some substantive. The unprecedented set of challenges to our economy and to our financial regulatory agencies, also the unique challenges that the global environmental problems we face place on our environmental agencies. We're also emerging from a period in our administration in which there was less aggressive regulation, and that may put pressure on the existing regulatory agencies to -- if you will -- try to catch up.

And like the rest of government, all the regulatory agencies face stringent budget constraints that can interfere with their ability to perform their function. So that's the moment at which you come to OIRA. In your prolific writings, you have expressed strong and I'd say sometimes controversial views about the way regulations should be developed and reviewed, so I'm particularly eager to hear your vision for OIRA and your thoughts on what role OIRA should play in this new Administration.

It's a pleasure to welcome you here, and I really do look forward to your testimony and the question and answer period.

Senator Collins.

SEN. SUSAN M. COLLINS (R-ME): Thank you. Thank you, Mr. Chairman. The question that your statement raises -- is anyone left at Harvard Law School -- (laughter) -- who has not been drafted to serve in this Administration?

I join the chairman in welcoming Professor Sunstein to our committee today. As we consider his nomination to be the administrator for the Office of Information and Regulatory Affairs, OIRA, as the chairman has pointed out, is one of the alphabet soup of government offices that few people outside of Washington have ever heard of, yet it can have enormous influence on regulations that effect the everyday lives of millions of Americans. Through the process of regulatory review, OIRA exerts significant influence over the rulemaking process.

Professor Sunstein is a prolific author who has conducted an extensive study of the government regulation and of the various methods that can be used to evaluate regulatory effectiveness. If confirmed, however, he would step from the world of theory into the realm of practice where not every idea discussed in the classroom can be easily turned into governmental policy, nor should it be. This can be a challenging transition for those leaving the academic realm for the world of the Executive Branch where their views and decisions have real consequences.

Some of the core principles that seem to guide Professor Sunstein's work appear to be appropriate for the OIRA position. For example, he is an advocate of greater transparency. I'm particularly interested in his recommendation that agencies should be required to explain a decision to regulate in those cases where the costs outweigh the benefits. The professor strongly supports the use of cost-benefit analysis as a tool for evaluating regulation while recognizing that such analysis cannot always be the sole criterion for evaluating the desirability of regulation.

In one of his most recent and intriguing books, "Nudge," Professor Sunstein makes a compelling case for regulation that does not dictate actions, but instead encourages certain behavior without limiting personal freedoms. While certainly not universally applicable, this idea bears exploring as an alternative to more Draconian and costly command and control regulations. Professor Sunstein has, however, written some provocative and controversial statements that warrant our scrutiny. His suggestion that perhaps hunting ought to be banned is particularly troubling to those of us who represent states where hunting and fishing are part of the heritage of their families.

Finally, I want to note that in the past OIRA has played a significant role in setting government-wide privacy policy. Since 2001, however, it has not be clear in who in OMB is in charge of privacy. As this Administration seeks to use information technology in innovative, new ways, OMB should make the protection of personal information a top priority.

An important first step will be to designate an individual, whether within OIRA, or elsewhere in OMB, who will be directly responsible for developing policy to safeguard privacy, and who will be accountable to Congress and the American people.

I look forward to discussing these issues with our witness.

Thank you, Mr. Chairman.

SEN. LIEBERMAN: Thank you, Senator Collins, and we're honored to welcome, Senator Amy Klobuchar, a colleague from Minnesota, to introduce you. In asking Senator Klobuchar to introduce you, you have without knowing, I assume, achieved a first I imagine in Senate history, because I gather than Senator Klobuchar was a student of yours when she was at the University of Chicago Law School. You may not know that she was a student of mine at Yale College. (Laughs.)

SEN. AMY KLOBUCHAR (D-MN): (Laughs.) It's an amazing coincidence. (Laughs.)

SEN. LIEBERMAN: That's an amazing coincidence, which will be noted in some book of trivia some day.

(Laughter.)

SEN. LIEBERMAN: Senator Klobuchar, it's a pleasure to have you here, and we welcome your introduction at this time.

SEN. KLOBUCHAR: Well, thank you so much, Chairman Lieberman and Senator Collins. I'm honored to join you here today. I'm especially honored because this is an opportunity to introduce Cass Sunstein and speak about his qualifications as the administrator for the Office of Information and Regulatory Affairs in the Office of Management and Budget. I first want to congratulate Cass. Here's here with his wife Samantha and his teenage daughter Ellen, and also his in-laws. It's always nice to have your in-laws supporting you. As you know, Cass and his wife Samantha are the proud parents of a baby boy just born two weeks ago. I guess they didn't bring him for the -- okay.

Back in the 1980s, as you mentioned, Mr. Chairman, I was privileged to have Cass Sunstein as my law professor at the University of Chicago. I took his administrative law class, and also, he was my advisor for the Law Review. His career as a legal scholar was just beginning to take off, but he was already making a very strong impression as a teacher. I think for many students he was their favorite teacher, but, of course, I won't say that, given, as you already stated, you were also my teacher, Mr. Chairman.

(Laughter.)

When we first saw Cass Sunstein in class, he really looked like a boy in a man's suit. He was so thin, but he had such enthusiasm. These were the days before white boards, and so he would always get a lot of white chalk on his black suit, and he was completely oblivious to it. (Laughter.) But he was far from being an absent-minded professor. He would race along at a mile a minute in his lectures, a fountain with a never ending stream of ideas. He was never boring, which is a tough standard for law students.

In the '80s, the University of Chicago Law School was well-known for its use of the Socratic method, which meant trying to next -- for students, trying to sit next to someone with an easier last name than theirs. So I would always, Mr. Chair, look for Johnsons or Jones, or those kinds of people. But when he did call on you, he would say things like Ms. Klobuchar, I have a question for you. And then he would say A, and then B, and then C, and then D, and once he was talking, you would stare at him and think I'm not sure where he started. But his mind could handle it.

In his 27 years at the University of Chicago, he became legendary for both his teaching and his scholarship. Cass Sunstein is one of the nation's most thoughtful and respected legal scholars with a distinguished record of accomplishments. A graduate of Harvard Law School, a law clerk to Supreme Court Justice Thurgood Marshall, a professor at the University of Chicago, as you noted, for 27 years, the author -- a co-author of more 15 books and hundreds of scholarly articles. And as Senator Collins has noted, I'm sure we will all find things in those articles we don't quite agree with.

But he is by large margin the most cited scholar on any law faculty in the United States of America. One envious observer said, "If you look at what he's written and done, he should be 900 years old." (Laughter.) Cass is not only a prolific writer, but also a wide- ranging one, everything from constitutional law and behavioral economics to Wikipedia and Bob Dylan's music. In one recent book he made good use of Mr. Spock of Star Trek and Homer Simpson to discuss the potential of human decision making.

But Cass hasn't been nominated for this position because of his detailed knowledge of TV characters. It's because no one has thought harder or more deeply, or more creatively about how to ensure fair, cost effective regulations in modern America. His overriding concern is that we have smart, science-based, cost-effective, results-oriented policies to protect public health and safety, to promote energy security, and to strengthen our economy and financial system. Cass is intellectually honest and rigorous, which means he goes where the evidence takes him.

The Wall Street Journal recently commended him as someone who will bring an important and much needed voice to the Administration. He has been supported by 13 Nobel Prize winners from across the political spectrum. They have endorsed him because they trust in his ability to think and get things done.

While he can debate abstract legal theories with the best of them, he is a scholar whose feet are firmly planted on the ground. He's a pragmatist. He cares about ideals, but ultimately, he cares more about the right results. In a famous essay, the historian and philosopher, Isaiah Berlin, made a distinction between thinkers who are hedgehogs and those who are foxes. He borrowed this from a saying by an ancient Greek poet: "The fox knows many things, but the hedgehog knows one big thing."

At first glance, Cass would appear to be a fox, given the volume and variety of his writings. But looking more closely, you can see that he's also a hedgehog. Do you like these animal analogies, Senator Collins -- (laughter) -- to get at what you were talking about? Okay. (Laughter.) It's no coincidence. We are also a state that likes hunting.

There's one big idea -- the hedgehog -- that animates virtually all of his diverse work. It's the idea that we will be better off when we take into account different viewpoints and let evidence guide our decisions. His open-mindedness and his willingness to look at all sides of an issue are virtues that will serve him well in this important position. In turn, the American people will be well served by these same virtues, as well as his dedication, hard work, and commitment to the highest standards of excellence.

So I'm very pleased to present Cass Sunstein to the members of this committee. Thank you very much.

SEN. LIEBERMAN: Thanks very much, Senator Klobuchar. That was a wonderful introduction. I appreciate it very much. And if I may do something that I presume Professor Sunstein never did, you're excused for the rest of the class -- (laughter) -- because I know you have a busy schedule today.

SEN. KLOBUCHAR: Thank you very much, Mr. Chairman.

SEN. LIEBERMAN: Thank you very much for that introduction. It was excellent.

Let's proceed to the hearing, and now I would say for the record that Cass Sunstein has filed responses to a biographical and financial questionnaire, answered pre-hearing questions submitted by the committee, and had his financial statements reviewed by the Office of Government Ethics. Without objection, this information will be made part of the hearing record with the exception of the financial data, which are on file and available for public inspection in the committee offices.

Our committee rules require that all witnesses at nomination hearings give their testimony under oath, so Professor Sunstein, I'd ask that you please stand and raise your right hand. Do you swear that the testimony you are about to give the committee will be the truth, the whole truth, and nothing but the truth, so help you god?

MR. SUNSTEIN: I do.

SEN. LIEBERMAN: Thank you. Please be seated. We would now welcome your statement and introduction, members of your family and even friends who are here.

MR. SUNSTEIN: (Laughs.) Okay, thank you, Mr. Chairman. I'm very grateful to be here. I'm grateful to you in particular for your kindness over the last weeks, Senator Collins, to you for being here and for the kindness and generosity of your staff, to members of the committee and their staffs for your guidance and suggestions and policy proposals and generosity. I am grateful to Senator Klobuchar for her extremely kind statement and also for her wonderful performance as a student, which vaulted her into public prominence. (Laughter.) I'm grateful to the President, of course, and honored by him for his trust.

With your indulgence, I'd like to introduce members of my family who are here. Eddie Burke, (sp) my father-in-law, my amazing mother- in-law, Vera Delaney, who played tennis at Wimbledon, my amazing daughter, Ellen Roddick-Sunstein (ph), and my remarkable wife, brave Samantha Power, who is a recent mother, and noting that fact, I'd like to mention two family members who are not here; my son, Deckland (ph), born two weeks ago, and my father, Cass Richard Sunstein, who, like Senator Akaka, fought in World War II. He was in the Navy in the Philippines, and I miss him a lot, particularly today. Thanks, dad.

Let me say a few words about my own background and my conception of the role of the Office of Information and Regulatory Affairs. As noted, for over two decades I've taught law, constitutional law, administrative law, environmental law, labor law, and associated fields, mostly at the University of Chicago Law School, and my writing is predominantly in those domains.

Recently, I moved to Harvard Law School where I founded the program on risk regulation, whose work overlaps greatly with that of the Office of Information and Regulatory Affairs. We explore homeland security, the economic crisis, energy security, environmental protection, occupational safety and health, and related topics.

In recent years, my own writing has emphasized three topics, as mentioned, transparency in information, as mentioned by Senator Collins, information disclosure, particularly as a regulatory tool, gentler often than command and control regulation. I've explored aggregation of information through the Internet with the thought that bureaucrats in particular often know much less than the American people do, and with the uses of the Internet we can often obtain valuable information about the best way to protect people and about ways to improve existing regulatory regimes.

Finally, with this book, Nudge, I've explored behavioral economics and approaches to regulation that are based on a realistic picture of how human beings behave in situations of risk, danger, information, and the goal is to try to provide protection to people without coercing them.

With respect to the Office of Information and Regulatory Affairs, three fundamental tasks involve information policy, statistical policy, and as emphasized, regulation. Information policy is absolutely fundamental, now more than ever. It bears on national security as well as on sound governance. And there are many challenges to be met in order to ensure that information is secure, that privacy is respected, that paperwork reduction actually occurs, that burdens on small business and others do not become overwhelming.

Sound statistics are the foundation for much of what the Executive Branch does, and the statistical work done at the office is the basis for much policymaking at the federal and state levels, and it's important that it be done objectively and that it be kept up to date.

Regulation, as you, Mr. Chairman, have noticed has been controversial in the domain of the work of the office, and I'd just like to emphasize three foundations for the work of the office in the regulatory arena. The first is everything done by the office as everything done by the Executive Branch, must be consistent with the law. The foundation of regulatory review -- the first question to be asked by the Office of Information and Regulatory Affairs is what are Congress's instructions? That is the starting point for any mechanism for regulatory review.

The second task is to ensure that within the boundaries set by Congress, things done are consistent with the President's own priorities and principles. The third task is to kind of institutionalize the notion of looking before you leap so that when the government is starting with a regulation, whether it involves homeland security, education, energy, or anything else, there's some sense of what the consequences are likely to be. That promotes accountability. It helps ensure that citizens and government can know what the likely effects of government action are.

The most important words in the executive orders governing regulatory review are these; to the extent permitted by law. Anything done within the framework of the Office of Information and Regulatory Affairs has to keep those six words in mind.

Mr. Chairman, we face a number of challenges right now involving national security, financial stability, energy security, environmental protection, healthcare reform, educational reform. I know that members of this committee have exercised leadership in those domains, and when legislation is passed in the future with respect to legislation that's been enacted thus far, regulations will try to meet those challenges. I look forward to working very closely with you and members of the committee and your staffs, if confirmed, to make sure that those challenges are well met in the coming years.

But for the moment, I look forward to answering your questions.

SEN. LIEBERMAN: Thank you very much. We'll begin with the standard questions we ask of all witnesses, three in number. First, is there anything you're aware of in your background that might present a conflict of interest with the duties of the office to which you've been nominated?

MR. SUNSTEIN: No, sir.

SEN. LIEBERMAN: Do you know of anything personal or otherwise that would in any way prevent you from fully and honorably discharging the responsibilities of the office to which you've been nominated?

MR. SUNSTEIN: No, I do not.

SEN. LIEBERMAN: And finally, do you agree without reservation to respond to any reasonable summons to appear and testify before any duly constituted committee of Congress if you are confirmed?

MR. SUNSTEIN: Absolutely.

SEN. LIEBERMAN: Thank you. So far you're doing very well. (Laughter.) We'll each have seven-minute rounds of questions.

I was interested in your opening statement in the extent to which I would say it was non-ideological. There's a sense that -- and I want to ask you to comment on this, that the Bush Administration, which just ended after two terms -- because it was more skeptical of the role of government -- was more halting in its regulation, whereas the Obama Administration -- presumably more supportive of governmental action, will be more supportive of regulation, and which is to say that this is, to use simplistic terms, a liberal Administration that follows a conservative Administration.

I want you to just talk about that common view that members of Congress and people outside have of the regulatory process and how you relate that to what you've just told us in your introductory statement, particularly about the primacy of the law.

MR. SUNSTEIN: Well, my own approach to regulatory problems I describe as pragmatic and empirical as an academic. That's a particular role. The role of the Office of Information and Regulatory Affairs -- the administrator -- should also be pragmatic and empirical, but those would not be the first two words.

The first description of the office is that its charge is to implement enacted legislation to ensure that the terms of regulations conform to the terms of statutes. And that is the starting point.

The second point is to ensure that whatever pragmatic and empirical approach is brought conforms to the President's own commitments and priorities. And the third step, consistent with executive order 12866, which remains the controlling executive order -- that the analysis that accompanies the regulations is sound, that there's investigation of alternatives, that there's some effort to assess consequences.

So in that third part, compliance with executive order 12866, subordinate to statutes, there's a big place for pragmatism and empiricism.

SEN. LIEBERMAN: And not in any -- there's no particular room there for ideology separate from the three factors that you've mentioned.

MR. SUNSTEIN: That's correct. The only place where what could be described as ideology would be playing a role is if there's a statute that has a particular orientation --

SEN. LIEBERMAN: Right.

MR. SUNSTEIN: -- or if the President -- as the President suggested --

SEN. LIEBERMAN: (So -- ?)

MR. SUNSTEIN: -- in the energy domain -- he has some ideas.

SEN. LIEBERMAN: Right. Understood. Let me talk about the relationship between OIRA and the agencies themselves. I want to ask you who you think should be in the lead in setting regulatory priorities, determining what type of regulation is needed, and then setting the final content for the rules, the agencies that are given authority under the laws, or OIRA?

MR. SUNSTEIN: Well, as you say, the statutes that give rulemaking authority give such authority to the agencies, so they have the authority to issue rules. There's also a structure in place for regulatory review, but that must respect the policymaking authority and rulemaking power of the agencies.

SEN. LIEBERMAN: Let me ask you to comment -- and this in some ways takes me back to the first question on the role of cost-benefit analysis. In your writings you've been a strong advocate for the use of cost-benefit analysis in rulemaking. I can resist asking you. Early in the Bush Administration we had a nominee before us for OIRA, John Graham, who was also an advocate, a very informed advocate, for cost-benefit analysis, but some of us voted against him because we worried that he was going to use a cost-benefit analysis to frustrate the intention of Congress in the statutes. And I wanted to -- but his work is actually comparable to yours, at least in the direction of it.

And I wanted to ask you -- I presume you know his work -- to -- and perhaps to say this as provocatively as I might, why shouldn't a senator who voted against John Graham's confirmation also vote against yours?

MR. SUNSTEIN: Thank you for that. (Laughter.) My own approach to cost-benefit analysis is inclusive and humanized I would say. I wouldn't want to characterize his -- in a pejorative sense. But what I've emphasized in my academic writing is that cost-benefit analysis shouldn't put regulation in an arithmetic straightjacket, that there are values, moral, distributional, aesthetic, and otherwise that have to play a part in the overall judgment about what's to be done. And I would emphasize even more than those things that I've stressed as a scholar -- which are the limits of purely economic approaches to evaluation of costs and benefits.

Think, for example, of the domain of protecting disabled people where as a scholar I've written consistently with the Americans with Disabilities Act. Cost-benefit analysis is an inadequate approach. We're not trying to maximize money with provisions that are protecting against discrimination. But even more than emphasizing the humanized, inclusive form of cost-benefit analysis, what I would emphasize is that all of this is subordinate to the law. So if the Clean Air Act has provisions that forbid cost-benefit analysis from being the basis of decision, that's authoritative.

SEN. LIEBERMAN: You've answered the following question that I was going to ask, which is that -- to refer to several statutes, particularly those that control environmental pollution or unsafe workplace conditions, which you referred to, other risks to the public where Congress has actually prohibited a consideration of costs in comparison to benefits and has mandated that regulations be based on other considerations, such as the availability of technology, or the protection of health. And I think you've answered that in what you -- I was going to ask you to relate to that -- just a final question, which you've touched on in this regard.

In your writings, you've describe the risk in the use of quantitative cost-benefit analysis, that is, you put it -- and I quote -- "It is possible that in practice quantitative cost-benefit analysis will have excessive influence on government decisions, drowning out soft variables," which is your term, end quote. What would you do as OIRA administrator to try to ensure that that does not happen?

MR. SUNSTEIN: The first task would be to make sure that if the soft variables are part of what Congress wants to safeguard -- that those variables be safeguarded. I referred to the Americans with Disabilities Act.

SEN. LIEBERMAN: Yeah.

MR. SUNSTEIN: The second task would be to ensure that if the President has a policy initiative in a domain that it reflects his commitment to those soft variables, that be respected. The third idea would be in any implementation of cost-benefit analysis that's worthwhile in practice, as opposed to Law Review articles, it's very important to be attentive to moral considerations, distributional considerations, others that sometimes animate government action. And that's how I would respond to the soft variables.

SEN. LIEBERMAN: Very interesting. Thank you. My time is up.

Senator Collins.

SEN. COLLINS: Thank you, Mr. Chairman.

Mr. Sunstein, I want to get right to the controversial issue that I raised in my opening statement before exploring other issues with you. In a 2007 speech, you said, and I quote, "We ought to ban hunting." Now, that was just one speech, but then in doing a search through some of your documents and legal articles, we also found a statement saying, "We might ban hunting altogether, at least if it's sole purpose is human recreation."

First, let me say that you certainly have the right to have any view on hunting that you wish. My concern as someone who represents a state where hunting and fishing and the outdoors are very much of our heritage that you not take steps, if you are confirmed, to try to influence regulation in such a way that it would affect the decisions that individuals make in conformance with state and local laws on whether or not to hunt.

Can you give me assurances that if you're confirmed you will not seek to implement your personal view that hunting should be banned?

MR. SUNSTEIN: Yes, senator, I can pledge that to you in the strongest possible terms. The only thing I'd add is that those law is authoritative, first. Second, I'm a strong believer in the Second Amendment of the United States Constitution. I'm on record as saying that the Second Amendment protects the right to hunt. That reflects my own personal view. The statement you quoted is a provocation, an offhand remark in a speech that was another -- on another topic. And not only would I not want to ban hunting if that were my personal view, it actually is not my personal view. Hunters are among the strongest environmentalists and conservationists in the United States, and it would be preposterous for anyone in a position like mine to take steps to affect their rights or their interests.

SEN. COLLINS: Thank you for that strong statement. Similarly, I read a primer that you wrote on the rights of animals when you were at Chicago, and you seemed to be suggesting that animals should have greater legal rights in the court system.

Now, I will tell you in reading this fascinating treatise, I cannot always tell when you're throwing out an idea for the purpose of exploring all the ramifications and all the possibilities versus where you're actually advocating for a position. So perhaps for -- perhaps I'll ask you right now. Why don't you help me --

MR. SUNSTEIN: Right.

SEN. COLLINS: -- with the issue of legal rights for animals.

MR. SUNSTEIN: Thank you for that. As OIRA administrator, as opposed an academic suggesting possible ideas for consideration, the question would be what does, for example, the Endangered Species Act say, or what does the Animal Welfare Act say, not what does a Law Review article say? So I would follow the law. In terms of my own academic writings, the suggestion, which was meant as a suggestion for contemplation, was that under state law that prevents cruelty to animals, it might that the enforcement by criminal prosecutors could be supplemented by suits by private people protecting animals from violations of existing state law, very much like under the Endangered Species Act where people, rather than elephants, initiative lawsuits.

So the idea was very -- actually very conventional and a little boring, though maybe my rhetoric made it seem less so. It was just about ensuring enforcement state anti-cruelty law, and I know you yourself have been a pioneer actually in the domain of animal welfare. So the idea here was a suggestion about state anti-cruelty law and that it would not be legitimate for the head of the Office of Information and Regulatory Affairs to be playing any role in a federal system in rethinking state anti-cruelty law.

SEN. COLLINS: Thank you. Let me turn to another issue that concerns me. You have recommended that the process of regulatory review that OIRA undertakes should be broadened to include independent agencies, such as the Federal Trade Commission, the Federal Communications Commission, the Consumer Product Safety Commission. That recommendation concerns me greatly because the whole reason that Congress creates independent regulatory agencies is to insulate them from Administration policies, whether it's a Democratic or a Republican Administration. Congress has deemed that this particular area needs to be protected from the changing agendas of different administrations.

If you bring these independent agencies within the regulatory purview of OIRA, you defeat the whole purpose of having them be independent agencies. You're treating them as if they're members of the governor's cabinet. So why do you advocate expanding OIRA's reach to independent agencies?

MR. SUNSTEIN: Well, in my academic writing, the suggestion was that a process of look before you leap, which included reflections within the Executive Office of the President on the view of, say, the Federal Commission, might be a reasonable way of insuring dialogue and participation. This would be -- this is the academic argument -- fully consistent with everything you've pointed to, which is clearly correct, and I'm sure the Department of Justice would put an exclamation point next to what you've said.

In my capacity as nominee for this office, the judgment of what relationship the FCC or the FTC or the SEC has with the President is a judgment for the President within the confines of the law. And the only thing I would add -- this is really not something for the Office of Information and Regulatory Affairs to select -- the only thing I'd add is whatever is done -- and nothing of this sort has ever been done, as you suggest -- must respect the legal independence of these very different entities.

SEN. COLLINS: Thank you, Mr. Chairman.

SEN. LIEBERMAN: Thank you very much, Senator Collins.

Senator Akaka, good morning. Welcome.

SEN. DANIEL AKAKA (D-HI): good morning, Mr. Chairman and ranking member. I'm delighted to be here at this hearing and to see Dr. Sunstein again.

First, I want to welcome you, Dr. Sunstein, and your family, and congratulate you on your newborn son, Deckland (ph). And secretly, I was hoping he would be here. (Laughter.) But thank you very much for bringing your family and also your friends to this hearing today.

As you may know, I'm a strong advocate for greater protection of personal privacy by the government. And too many government agencies and private companies have failed to adequately protect personal privacy. As administrator of OIRA, you would oversee numerous regulations that protect the privacy rights of millions of Americans.

I believe that more can be done to protect personal information, and I hope that privacy protection will be a priority at OIRA under your leadership. You did respond to the chairman's questions about what you would do in protecting privacy and did mention some steps you would take as administrator.

My further question to that, to expand it, was to ask whether you have other possible ways in mind that you would like to do this.

MR. SUNSTEIN: Thank you for that, senator. With respect to privacy, the Office of Information and Regulatory Affairs works with the Privacy Act of 1974. And the first task would be to consult with the head of the Office of E-Government who works with the Office of Information and Regulatory Affairs on privacy issues, and to talk through the existing guidance which has been provided by the Office of Information and Regulatory Affairs to assess its adequacy.

I'd want, if confirmed, to speak first with him, Vivek Kundra, who's terrific, second with OIRA staff, which has been involved in privacy, and third, to engage in a process of outreach within interested stakeholders of various sorts to see what problems have emerged. In what circumstances are people's privacy being compromised, and in particular, to look for the next five or ten years -- what sorts of threats to privacy are there going to be? Often the government is reacting to problems of the last year and not foreseeing the problems of the next five.

And then my goal would be, if confirmed -- I want to hit the ground running on this one in particular -- to look to what reforms ought to be made within the framework you've provided under the Privacy Act to ensure that when people don't want third parties to learn what they've got on Amazon or whatever, nothing is -- or anything about their medical records, to ensure that all this is kept private.

SEN. AKAKA: Dr. Sunstein, the Privacy Act and the E-Government Act are the primary mechanisms for protecting Americans' privacy. This is an especially important issue with the growing use of electronic information and technology by the government, and increased information collection in response to the threat of terrorism. Do you believe that the Privacy Act and the E-Government Act currently provide adequate privacy protections?

MR. SUNSTEIN: I think the Privacy Act of 1974 was amazingly prescient. It's a law that was enacted a generation ago, and the basic foundations of the act have really stood the test of time. What's not clear -- and I gather this is the heart of your question -- is whether the communications revolution that we've seen in the last 15 years unsettles some of the practices that have emerged under the Privacy Act. And on that one, it's clear. A very careful look on the regulatory side makes sense, and I understand that this committee is investigating whether legislative change is desirable. And I'd like forward to working with you very closely on that, because that's one that, as I say, in the next five or ten years is going to be even more urgent than it has the last five or ten.

SEN. AKAKA: Thank you. Dr. Sunstein, recently the Homeland Security and Governmental Affairs Committee reported my bill, the Plain Writing Act favorably. That bill would require federal agencies to start issuing documents in plain, easy to read writing. OMB would develop plain writing guidance and would help oversee implementation. As you know, OIRA's mission includes overseeing dissemination of and access to government information, so I would expect that OIRA would take the lead with OMB on implementation.

You've told me that you are an advocate for plain writing.

As the head of OIRA, do you feel you would be well prepared to spearhead implementation if the Plain Writing Bill were enacted?

MR. SUNSTEIN: I do, senator. I would defer to the director of the Office of Management and Budget on allocation of resources and such issues. He would be my boss, but the answer is absolutely.

SEN. AKAKA: Yeah. Well, thank you very much, and thank you for your responses, and thank you for bringing your family and your wife here today.

MR. SUNSTEIN: Thank you.

SEN. AKAKA: Thank you.

SEN. LIEBERMAN: Thank you, Senator Akaka. We'll do a second round insofar as members have additional questions. I've got a few. Let me just focus in on the other side of your responsibilities from the privacy side that Senator Akaka focused on, which is the accessibility that the public has to governmental actions. The Paperwork Reduction Act is one of several pieces of legislation that this committee adopted and the Congress adopted to make government more accessible to the citizenry. The statute now states that the OIRA administrator -- and I quote -- "will assist the OMB director to develop and oversee the implementation of uniform information resource management policies, principles, standards and guidelines that will promote public access to public information.

As Senator Akaka mentioned, later the E-Government Act was passed saying that the Administrator of E-Government would work with the OIRA administrator to (fulfill ?) these statutory responsibilities. I want to ask you generally -- you mentioned that you would be working with the Federal CIO, Vivek Kundra. How you will work -- what your goals are there to establish clear guidelines for federal agencies when it comes to information management on the public accessibility side.

MR. SUNSTEIN: First priority, Mr. Chairman, would be the regulations.gov website, which should make very clear to affected citizens and even interested citizens who aren't affected, but who are curious about what their government is doing -- what the regulations say and what the burdens are, and what the benefits are. Regulations.gov at present is a very impressive start, but it's not clear that it satisfies the plain English test. As administrative law teacher, I've spent considerable time on the regulations.gov website and learned a great deal, but it just isn't as accessible as it ought to be to citizens, and that's where I would start.

SEN. LIEBERMAN: Well, I agree totally with you about that, that it's -- we understand it's an enormous challenge to do what we've asked regulations.gov to do. And they're off to a decent start, but I agree with you, if I hear you correctly, that it needs a lot of improvement, because the -- I think the congressional intention here was not just to provide some access to information, but really, to give individuals the opportunity to comment on proposed regulations, which is -- to an extent that they've never had the ability before because of the Internet. So do you have any specific ideas about how you might make it better?

MR. SUNSTEIN: Yes. First of all, much more simplicity and much more plain English. And the architecture of the website should be altered so that you don't have to click so much before you start to read something that's itself quite complicated. So much greater simplicity of the sort that the private sector often has. In terms of public comment on regulations, I think we've just started to realize the process of an era of public reaction and input with respect to regulations. And this is something I've worked on as an academic. It's something that Vivek Kundra is much interested in, and the director is also interested in listing private sector knowledge in terms of seeing what's working well and poorly for existing regulations, in exploring gaps in regulatory protection, some that can be filled by agencies without any legislation, and in -- also in getting a clear sense by affected people who often don't know what the regulations are, let alone have input until the regulations are imposed on them.

So simplicity, clarity and publicity would be watch words. And the beauty of this is it's not just realizing democracy in a way we haven't been able to do before.

SEN. LIEBERMAN: Right.

MR. SUNSTEIN: That's great. But also great is we've got regulations that will be much better. They'll be much more suited to people's actual situations.

SEN. LIEBERMAN: Exactly, because they'll reflect their circumstances. I learned long ago when I was in the state legislature in Connecticut that -- and it relates to anybody in government -- but that we come to government with our own experiences, obviously -- inherently limited, and then we're asked in our case to legislate and yours now to regulate. Of course, the widest array of human experience -- and it struck me -- (laughs) -- that it pays to listen to the people who happen to live in the area or field that you're regulating, and the Internet does give us an opportunity to do that better than we ever have before.

I was struck -- moving on -- talking about my state Senate career. You wrote an article called is OSHA Constitutional? On a particularly strange day in my legislative career at a hearing on OSHA I raised the question is OSHA kosha? (Laughter.) So I want to thank you for giving me the opportunity to remember that day, but I go on more seriously. You wrote a similarly entitled article awhile back, about a decade ago -- Is the Clean Air Act Constitutional?

So I wanted to ask you to explain your view about the constitutionality of these landmark statutes to protect public health and the environment.

MR. SUNSTEIN: Thank you for that. The conclusion of the Clean Air Act paper was the Clean Air Act is constitutional. The conclusion of the OSHA paper was OSHA is constitutional. And at first glance, this would be the most boring and obvious conclusion a law professor could ever reach. What inspired the two articles was a set of decisions within the D.C. circuit, the Court of Appeals, that had actually raised questions about both statutes. I tried to say the Clean Air Act was constitutional and the D.C. circuit should not have suggested otherwise. The Supreme Court eventually agreed with that.

The OSHA question is newly alive because of some D.C. circuit decisions from the 1990s, which upheld the statute a little bit with difficulty. There are some intervening Supreme Court cases that raise questions about those decisions, upholding the statute. The point of my article was to say here are some roots by which it could be held constitutional. So both are constitutional.

SEN. LIEBERMAN: Okay, thank you. This leads, of course, to the question of whether you would feel it was within your purview as administrator of OIRA to apply a constitutional test of your own to regulations, or whether this would be dependent, as it was in the articles you've sited on court decisions.

MR. SUNSTEIN: I would feel it would be my obligation to refer the matter to the Department of Justice.

SEN. LIEBERMAN: If you had a constitutional question.

MR. SUNSTEIN: Yes.

SEN. LIEBERMAN: Thank you.

Senator Collins.

SEN. COLLINS: Thank you, Mr. Chairman. I too want to follow up on the privacy issues that my two colleagues have raised and that I raised in my opening statement. I certainly agree with you that the Privacy Act of 1974 has withstood the test of time amazingly well. I believe that parts of it still nevertheless need to be updated, but when you consider that it was written before the information age, it is -- the basic principles of the act still very much apply.

But no matter how good our laws are, if there are not individuals in government who are charged with implementing them, overseeing them, they tend to not be enforced as effectively as they should be. I mentioned in my opening statement that back in 2001 there was a chief counselor for privacy within OIRA. Nowadays the privacy officer of the Department of Homeland Security tends to be the premiere privacy expert in the federal government in part because of the many challenges that that Department faces in weighing privacy concerns.

But really, there should be someone within OMB who has that specific privacy portfolio. As I mentioned in the past, the chief counselor for privacy was part of OIRA. Do you intend to reestablish that position if you are confirmed?

MR. SUNSTEIN: I intent to look very carefully at what institutional structure is best suited to the protection of privacy. I agree very much that accountability on any matter -- emphatically including privacy -- requires a person whose responsibility is to provide that protection. My understanding is that there's a notice out right now to hire someone whose sole job at OIRA would be to protect privacy. My understanding also is there are several people at OIRA who are spending a great deal of time on this issue, but I very much take your point that there's a question whether these are adequate ways of providing what was provided in the past.

SEN. COLLINS: In my previous round of questions I mentioned my concern about a proposal that you'd put forth to extend OIRA to independent regulatory agencies. Let me balance that now by telling you a proposal you put forth that -- I think it's an excellent idea, and that is to require agencies to explain why they are moving ahead with a regulation in a case where the costs outweigh the benefits, as shown by a cost-benefit analysis.

Do you believe that currently agencies provide adequate justification for moving forward on a regulation that has failed the cost-benefit analysis?

MR. SUNSTEIN: It's a crucial question, whether -- when agencies are imposing big burdens on business and they're not providing big benefits to people, they're adequately explaining themselves. I don't have a general conclusion to that because I haven't done a systematic study of the cases in which agencies proceed, even though the costs are higher than the benefits. What I would say is for the future -- and this is very much consistent with the existing executive order -- agencies would have to say something, such as the law requires us to proceed, or there are soft variables that matter.

So I'm not sure whether a -- what the right generalization is about past practice, but I can tell you for the future to have full explanation is apart of ensuring accountability.

SEN. COLLINS: Do you expect that the President is going to issue a new executive order?

MR. SUNSTEIN: Don't know the answer to that. I do know that he's asked for recommendations, but whether he's going to issue a new executive order, I don't know.

SEN. COLLINS: And have you given recommendations to the White House in this area?

MR. SUNSTEIN: Well, as a senior advisor to the director, I've shared thoughts.

SEN. COLLINS: And are they along the lines of the recommendations that you've made in some of your academic writings?

MR. SUNSTEIN: I would say there is some, but very incomplete overlap between my recommendations as a temporary advisor and my academic thinking.

SEN. COLLINS: Would you like to share those recommendations with us?

(Laughter.)

MR. SUNSTEIN: I think if the director would like to tell you --

SEN. COLLINS: (Laughs.) Very good. (Laughs.) I didn't really expect you to say yes to that, I must say.

I'm also interested in proposals that you have to increase the transparency of decision making in the regulation area. It's very frustrating to many of my constituents that the rulemaking process appears to be so opaque and so difficult and that ironically the prohibitions against third party communications or just discussions in some ways -- although they're necessary to guard the integrity of the process -- impede the process because it seems to many of my constituents that their concerns are not heard, that they go into this black hole. And it's not just everyday citizens. The governor and state officials feel that way in some cases as well. We're going through this now with an issue involving the listing of the Atlantic salmon. And it's frustrating not to be able to communicate fully all that the State of Maine is doing to restore habitat for the salmon.

Do you have any recommendations on how we can make rulemaking more transparent, more accessible?

MR. SUNSTEIN: I do. An open door, maybe to some extent an open virtual door, but also, an open real door on the part of OIRA and its administrator makes a great deal of sense for your reason and the chairman's, that often affected stakeholders know things that the agency and OIRA don't. So participation as a foundation of rulemaking, as a way of ensuring transparency -- that would be first.

Second, no secret or back room participation, open and public, in the sense that if OIRA is meeting with people, then people get to know about that. That would be the starting point.

SEN. COLLINS: Thank you, Mr. Chairman.

SEN. LIEBERMAN: Thank you, Senator Collins. Do you have any other questions?

SEN. COLLINS: I don't.

SEN. LIEBERMAN: Neither do I, so Mr. Sunstein, thanks very much for your testimony today. Thanks for your willingness to come into federal public service. We thank -- congratulate you and your wife for the birth of the baby and thank her for her service as well. I can't end without noting the presence of your friend and mine, Leon Wieseltier, and long-time literary editor of the The New Republic. (We've seen ?) Leon out there -- and I apologize for even entering on -- this in the record -- reminded me of the scene from the Godfather movie where the witness is about to spill the beans on the organized crime family and they bring his brother from Italy, who he hasn't seen in a long time, and he clams up. In this case, Leon's -- I -- is here looking directly over your shoulder just to make sure that I do the right thing. (Laughter.) And I certainly do intend to support your -- (laughs) -- nomination.

We're going to keep the record open until noon tomorrow for the submission of any written questions or statements. I hope to be able to move your nomination as quickly as we can from the committee out to the Senate floor for consideration. Obviously, that depends on the inclinations of the other members of the committee, but again, it's been a very substantive and interesting morning, and I thank you for your willingness to serve.

The hearing is adjourned.

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