1 Announcements--Tuesday Read committee simulation this week for breakout Paper casenext week. Your TA will or otherwise assign you to a role (e.g. EPA) this week. You do not need to meet in your group until late next week.

2 Announcements--Thursday Paper casenext week. Your TA will or otherwise assign you to a role (e.g. EPA) this week. You do not need to meet in your group until late next week.

3 G302, Week 11: The Supply of Policy

4 Ernst and Young The Big Five accounting firms all do tax lobbying for clients EY is a leader in this. In 2000 it bought a Washington lobbying firm The current Asst. Secy. of the Treasury for Tax Policy used to be head of EYs tax department

5 What you will learn today Where a company can best intervene to get a law passed or blocked The importance of procedure and process in lawmaking

6 What is the best time for a business to intervene in lawmaking?

7 3 Branches3 Chances Legislative: The US House and Senate write the law Executive: The President, Treasury Dept., EPA, and so forth implement the law Judiciary: The courts decide disputes that arise under the law

8 The Path of a Bill... CongressmanCommittee Subcommittee HearingsCommitteeRules Committee SenateConference Committee House & Senate President (veto) Its a law! Floor debate

9 The House Ways and Means Committees Jurisdiction Customs, collection districts, and ports of entry and delivery Reciprocal trade agreements Revenue measures generally Revenue measures relating to insular possessions Bonded debt of the United States, subject to the last sentence of clause 4(f) Deposit of public monies Transportation of dutiable goods Tax exempt foundations and charitable trusts National social security (except health care and facilities programs that are supported from general revenues as opposed to payroll deductions and except work incentive programs)

10 Rep. Hostettlers Committees (2002) Armed Services Committee Subcommittee on Military Installations and Facilities Subcommittee on Military Research and Development Judiciary Committee Subcommittee on Courts, the Internet, and Intellectual Property Subcommittee on the Constitution

11 Senator Lugars Committees (2002) Agriculture, Nutrition, & Forestry Committee (ranking member) Agriculture, Nutrition, & Forestry Committee (ranking member) Foreign Relations Committee Subcommittee on Central Asia and South Caucasus Subcommittee on Central Asia and South Cau Subcommittee on European Affairs Subcommittee on Western Hemisphere, Peace Corps and Narcotics Affairs Subcommittee on East Asian and Pacific Affairs Select Committee on Intelligence

12 The Filibuster: ___________________________ In the Senate, it requires a 3/5 vote to end debate.

13 Example: The Patients Bill of Rights Should patients be allowed to sign away their right to sue for certain kinds of damages, in exchange for a lower price for health care? Protecting the right to sue = __________ ___________________________________ Taking away the right to promise not to sue

14 What Happened 1998: Senators Lott and Nickles block legislation from coming to Senate floor. 7/99: Senate passes bill with Nickles Amendment by 53-47; no right to sue. 10/7/99: House passes Norwood-Dingell Bill by ; has right to sue HMOs. 10/99 – 6/00: Bill is stalled in Conference Committee chaired by Sen. Nickles. 6/00: Sen. Kennedy attaches Norwood-Dingell to another Senate bill as a rider, a type of amendment. The bill loses by 1 vote.

15 Example: The Pickering Nomination Charles Pickering was nominated by Republican President Bush to be an appellate judge in But judicial nominations need Senate approval... On a party line vote, the Judicial Committee refused to report the nomination to the floor On the floor, Pickering would have won– he had several Democrats who would have voted for him

16 A: Tax breaks for buying American steel B: Tax credits for steel workers C: Depreciation tax breaks for steel companies 40 Typical voters ABC (A best, then B, C worst) 40 Steel unions BCA 20 Ernst and Young CAB B vs. C : _____________________________ Winner vs. A: ________________________ ____________________________________ PROCEDURE WITH THREE CHOICES B wins, 80 to 20 A wins, 60 to 40

17 A: Tax breaks for buying American steel B: Tax credits for steel workers C: Depreciation tax breaks for steel companies 40 Typical voters ABC (A best, then B, C worst) 40 Steel unions BCA 20 Ernst and Young CAB If the senators vote these preferences, then (a) First A wins, then A again. (b) First A wins, then C. (c) First B wins, then B again. (d) First B wins, then C. First, vote on A vs. B. Second, vote on Winner vs. C.

18 The Business Lesson: ___________________ If you get to choose the order of votes, you get to choose the result of the votes It matters who sets the agenda. 1. Did the sign-in sheet get around? 2. If you answered a question, bring up a notecard for me.

19 Rulemaking and Litigation The Clean Air Act (1970) directs the EPA to set air quality standards requisite to protect the public health. State Public Utility Commissions are expected to set just and reasonable rates. The FDA is required to establish the safety and efficacy of new drugs.

20 The Courts The Chevron Doctrine:______________ ___________________________________ What is easiest to challenge are procedural mistakes by the regulator Courts should defer to agency interpretations of statutes unless the agencies are grossly wrong.

21 Agencies must ensure: Broad representation Rights of participation A clear, predefined process A public record of the evidence presented

22 The Rulemaking Process A proposed rule or change to an existing rule is published in the Federal Register, which has upwards of 70,000 pages per year. Comments are invited. The agency holds hearings to collect evidence. The agency considers the evidence and publishes a final regulation in the Federal Register and the Code of Federal Regulations.

23 Example: The U.S. Forest Service halted a timber sale to the Wetsel- Oviatt Lumber Company on the grounds that it would hurt spotted owls