What are "midnight regulations," and how do they affect the next presidency?

During the 2000 campaign, Texas governor George W. Bush became known as "Dubya."
During the 2000 campaign, Texas governor George W. Bush became known as "Dubya."
Paul Buck/AFP/­Getty Images

­When Texas governor George W. Bush ran for president of the United States in 2000, he crafted a folksy, approachable image for himself. It worked. Bush won the new, yet vital Sam Adams/Roper Starch poll -- 40 percent of Americans polled said they'd prefer to have a beer with Bush over his rival for the presidency, Vice President Al Gore [source: Business Wire]. Bush's image was eventually encapsulated within a single letter, W, his middle initial. Eventually, it morphed into a variation on the letter pronounced in a Texas drawl: Dubya. The everyman's presidential candidate was born.

After the United States Supreme Court ruled against a recount of contested votes in Florida and Bush was named the new president, he and his transition team entered the White House to begin the new administration in January 2001. Dubya quickly found that his predecessor, Democratic two-term president Bill Clinton, had a sense of humor. The letter "W" had been removed from almost all of the computer keyboards in the White House executive offices [source: Brillman].

Bush soon found bigger, less entertaining headaches that Clinton had left for him -- more than 26,000 pages of new regulations issued by the outgoing president during the last two months of his administration. Among them was a reduction in acceptable arsenic levels from 50 to 10 parts per billion. Bush opposed the decrease, citing the potential financial impact on industries like mining, and quickly suspended Clinton's regulation with an executive order.

­That move allowed ecological groups to paint the Bush administration as anti-env­ironment, an image that would come to characterize his presidency. Bush later relented and accepted the Clinton standard, regretting the initial opposition as "one of the worst moves of his young administration" [source: Seelye]. Bush expended a tremendous amount of political capital -- power and influence generated throughout his campaign -- for his losing fight against the arsenic standards. Through a presidential tool known as midnight regulation, his predecessor had forced him into an embarrassing situation.

­What are midnight regulations? Why are they used with such glee by outgoing presidents -- and such a pain in the neck for new administrations? Find out on the next page.

How Midnight Regulations Affect New Administrations

Federal agencies like the Federal Emergency Management Agency (FEMA) represent the point where the government touches the lives citizens. How these agencies are managed is left to the discretion of the president.
Federal agencies like the Federal Emergency Management Agency (FEMA) represent the point where the government touches the lives citizens. How these agencies are managed is left to the discretion of the president.
Mandel Ngan/AFP/­Getty Images

­In the United States, the legislative branch of the federal government creates new laws. For example, Congress created the Securities and Exchange Commission (SEC) to regulate publicly traded companies. The executive branch, led by the president, ensures these laws are enforced; it carries out the actual regulation of agencies like the SEC. It does so by issuing regulations that direct agencies on how enforce these laws. So the SEC may propose a rule that requires all companies to file earnings reports following a specific accounting method. The proposal is submitted for review, and, if approved, becomes law 30 to 60 days later.

The enforcement, creation and replacement of regulations are all generally left to the president's discretion. The president's viewpoint can determine how strictly the SEC oversees financial reporting among publicly traded companies. A pro-business president will likely take a hands-off approach, while a more socialist president will place a greater emphasis on giving the SEC teeth.

Federal regulatory agencies have a direct and encompassing impact on the lives of Americans and citizens around the world. They issue rules defining what constitutes profanity during a television broadcast, declaring pharmaceuticals safe for human consumption, allowing eavesdropping on Americans' private phone calls, and much more. Cumulatively, a president's regulatory decisions form the country's direction. This direction changes from presidency to presidency, and the change is most pronounced when control of the White House changes party hands.

The reticence of some presidents to relinquish this control might explain the popularity of what have come to be called midnight regulations, or the prolific creation of regulations that come at a presidency's end. The midnight of a presidency occurs every four to eight years in the "lame duck" period between the new president's November election and the late January inauguration that officially ends the outgoing president's administration. Once a president has served two terms or lost re-election, much of that administration's accountability is lost. Although the president is no longer beholden to the electorate, he or she still wields the same power.

Midnight regulation is a powerful tool in a departing president's arsenal. It can represent the final push of the president's agenda and often characterizes its more radical fringes. This flood of new regulation creates the potential for a president to extend his or her administration's influence long past its departure from the White House. Midnight regulations are often slipped past Congress, (which may be only partially operating) and usually occur in such volume that it will be nearly impossible for the next administration to unravel the tangled web they weave. As a result, a new administration looking to steer the country in a new direction can find the wheel stuck tightly in the opposite one.

An outgoing administration can easily use midnight regulations to handicap the effectiveness of a new one. Not only can changing these last-minute rules cost time and resources, but undoing them can also lead to embarrassing situations and political fights. Presidents may also create this final agenda push to curry favor with the outgoing president's party and avoid the partisan dogfights that characterize this period. This is a smart move, as there is life beyond the presidency. By chairing his or her party or by taking a leading party position, a seasoned former president could try to exert a Putinesque influence over less experienced party members (or possibly another president) when his or her party regains White House control.

­Because of the outgoing president's relative lack of accountability during his or her midnight period, prolific regulation during the last quarter is often criticized as undemocratic [source: Brito and de Rugy]. Yet, it's the rules of democracy that have allowed this cynical use of presidential power to continue.

Undoing Midnight Regulation

President Bill Clinton signed the Congressional Review Act of 1996, which allows Congress to speedily repeal midnight regulation.
President Bill Clinton signed the Congressional Review Act of 1996, which allows Congress to speedily repeal midnight regulation.
Paul J. Richards/AFP/­Getty Images

­An incoming president has a few options available to reverse the tide of midnight regulations enacted by his predecessor. Time is often of the essence, since the earliest proposals in the midnight period may have already been reviewed, published in the Federal Register and undergone the 60-day waiting period. In other words, they may already be law. Once a new regulation becomes law, it takes as much time and energy to repeal it as it took to create it. A new administration must also show why repealing the regulation or substituting it with a new one is a better alternative to the original proposal. With midnight regulation, this may not be as difficult as it might be costly in time and taxpayer funds.

More effectively, the new administration can issue an executive order suspending new regulations that haven't yet become law and repeal any that are still being reviewed. Presidents Ronald Reagan, Bill Clinton and George W. Bush all ordered such directives upon taking office. Congress also has a tool available to use, one ironically signed into law by the most prolific midnight regulator, Bill Clinton: the Congressional Review Act of 1996.

Congress has always had the power to repeal laws, but the CRA grants Congress the power to repeal new regulations with simple majorities in both the House and Senate [source: Brito and de Rugy]. The repeal requires the president's signature, and here's where the CRA gets tricky: The CRA is only effective when an incoming administration and Congress are controlled by the same party. This is an uncommon occurrence, although it happened in 2001 and 2008. Even when Congress and the White House are aligned, the CRA hasn't been widely used. In 2001, it was used to repeal just one of President Bill Clinton's midnight regulations.

A number of simple solutions have been proposed that could address the problem of midnight regulations and the difficulty they can create for a new administration. Passage of a moratorium on new regulations during the midnight period or laws that make it easier for a new president to repeal last-minute legislation enacted by his predecessor could protect against the damage midnight periods currently cause [source: Brito and de Rugy]. None, however, have been implemented; administrations are reluctant to hamstring their own future efforts by lobbying for legislation that will reduce midnight regulations at the end of their presidencies.

A midnight period occurred in late 2008 when two-term Republican president George W. Bush's administration came to an end. Bush put forth several controversial midnight regulations, including a Department of Health and Human Services "right of conscience" regulation that redefined contraception as abortion and expanded protection for health care workers who refuse to give counsel on contraception to patients [source: Savage]. Bush's successor, Democratic-president-elect Barack Obama, told the media he would try to repeal the regulation upon taking office. In the interim, however, he was forced to sit idly by until the end of his predecessor's midnight period [source: Pear].

­Like many modern presidents before him -- including his predecessor -- Obama could look forward to being initiated into the presidency by spending political capital on a sensitive issue he opposed.

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