As successive GATT and WTO negotiations have reduced border protections
of manufactured products over time, domestic policies that affect
manufacturers costs and ability to innovate have increased
in importance in determining manufacturers competitiveness.
The Office of Competitiveness and Regulatory Analysis addresses
competitiveness issues by undertaking analysis of domestic
and international policy studies and regulatory
policy analysis.
Domestic and International
Policy Studies
Completed
Analysis
Energy
in 2020: Assessing the Economic Effects of Commercialization of
Cellulosic Ethanol
U.S. dependence on imports of crude oil has steadily increased
for three decades. One way to reduce this dependence is to increase
domestic production of renewable fuels such as ethanol. Cellulosic
ethanol is ethanol that is manufactured from the cellulosic materials
in biomass, such as crop and forestry residues, energy crops,
and wood wastes. This report examines the effect on the U.S. economy
in 2020 if advances in technology allow cellulosic ethanol to
become commercially viable and if production of it becomes adequate
to allow total annual U.S. ethanol production to reach 30 billion
gallons.
Potential
Exports of U.S. Clean Coal Technology through 2030
Increased demand for coal-fired electricity capacity worldwide
could lead to as much as $36 billion dollars of exports for U.S.
clean coal equipment manufacturers from 2003 until 2030. Specifically,
China, India, and South Korea present the greatest value of U.S.
clean coal technology exports in this study, representing approximately
$26 billion, $3.5 billion, and $3.2 billion, respectively. Australia,
Brazil, Mexico, New Zealand, South Africa, and the EU 25 account
for an additional $2.9 billion of growth.
Employment
Changes in U.S. Food Manufacturing: The Impact of Sugar Prices
This report was
written in response to a provision in the 2005 appropriations
act for the Department of Commerce (P.L. 108-447), more than 10,000
jobs were lost between 1997 and 2002 at sugar-consuming companies,
such as confectioneries. It suggests that high domestic sugar
prices were a major factor in this trend. The study points out
that many U.S. manufacturers of sugar-containing products have
closed or relocated their plants to locations where sugar prices
are less than half of the U.S. price. In 2004, for example, the
price of U.S. refined sugar was 23.5 cents per pound compared
to the world price at 10.9 cents.
[Return to list of Domestic and International
Policy Studies]
Ongoing Analysis
The Effect of
Inward FDI Restrictions on the Energy Sector
This analysis quantifies the effects on the U.S. economy of delays
in inward foreign investment transactions in the United States.
Inward foreign direct investment (FDI)
is an important source of investment capital in the U.S. economy,
representing 12 percent of the total U.S. capital stock. FDI in
the U.S. manufacturing sector is even more important, where the
share is even greater, 27 percent.
Climate Change Mitigation Strategies
Climate change mitigation policies, such as a CO2 emission tax or cap-and-trade system, will affect the competitiveness of all industries. The composition of fuel stocks used to produce energy will change in accordance with the level, and method used to impose the additional costs. This report examines the impact, and response of domestic industry to the level of taxation required to bring carbon emissions to mandated levels.
[Return to list of Domestic and International
Policy Studies]
Regulatory Policy Analysis
Manufacturing and Services
(MAS) has a comprehensive program of regulatory review, of
which OCEA is an integral component. MAS and OCEA analysts leverage
their industry knowledge and capacity for economic analysis to
improve Federal regulatory outcomes through several actions:
- Supplementing Agency Regulatory Impact Analysis (RIA) with
richer industry knowledge that incorporates analysis of upstream
and downstream economic activities, including impacts on business
competitiveness in an increasingly open U.S. economy.
- Ensuring that costs associated with a given rule are assessed
in the context of overall regulatory burden faced by businesses
from all existing/proposed rules.
- Introducing new approaches to regulatory analysis that draws
on lessons from assessments of the soundness of past Regulatory
Impact Analyses.
MAS' primary value added to the regulatory process is using its
industry and international trade expertise to improve analysis
of proposed regulations. Industry expertise allows MAS to evaluate
the regulatory agencies' impact assessments and businesses' ability
to stay competitive. For example, one type of analysis that is
seldom undertaken by regulatory agencies is macroeconomic multi-market
analysis, which OCEA can undertake to assess the impact of proposed
rules on economic growth and job creation. Additionally, a policy
or regulation affects not only the immediate industry but also
other upstream and downstream markets, and MAS analysis takes
these economic impacts into consideration. Traditionally, this
type of impact assessment falls outside the scope of analyses
performed by the regulatory agencies.
MAS contributes to the regulatory review process by undertaking
analyses intended to supplementnot replacethe mandated
analyses undertaken by the rulemaking agencies. MAS also ensures
that appropriate industry and other stakeholder input on competitiveness
are injected into the rulemaking deliberations. This twin role
of bringing supplemental industry analysis and ensuring appropriate
stakeholder input into the rule-making process leads to more informed
decision making and improved business competitiveness.
The Current State of Regulatory Policy
Activity
MAS has formed seven teams to carry out analysis of impacts of
seven major rules:
- EPA's Definition of Solid Waste
- The Environmental Protection Agency (EPA)
rule governing spill prevention control and countermeasures
- OSHA's Occupational Exposure to Crystalline
Silica
- OSHA's Occupational Exposure to Beryllium
Rule
- The Department of Transportation's Side
Impact Safety Regulation
- The Department of Justice's Americans With
Disabilities Act
- The Occupational Safety and Health Administration
(OSHA) rule establishing a permissible exposure limit for Hexavalent
Chromium
EPA'S
Definition of Solid Waste. In October 2003, EPA published
its proposed rule to revise the Definition of Solid Waste (DSW)
under the Resource Conservation and Recovery Act (RCRA). The rule
was nominated in OMB's 2005 report, "Regulatory Reform of
the U.S. Manufacturing Sector," as one that, if reformed,
could enhance competitiveness of U.S. manufacturing.
Under the current RCRA, certain waste streams are regulated as
hazardous wastes, even when they are being recycled. The objective
of a reform of this rule is to increase recycling rates while
reducing the costs of managing hazardous wastes.
On March 26, 2007, EPA published a supplemental
proposal for the Definition of Solid Waste rule in the Federal
Register (read ITA's summary here).
Comments on the proposal will be accepted until June 25, 2007.
To provide industry input about this rule, please contact
at 202-482-5159. [Return to list of regulatory
studies]
EPA'S
Spill Prevention, Control and Countermeasure (SPCC) Rule.
The SPCC rule was selected by EPA for review after a request by
OMB to update old rules that may be overly burdensome. The rule
describes measures that must be taken to prevent oil spills, and
applies to any company that stores more than 1320 gallons of oil
on its property. The rule was nominated in OMB's 2005 report,
"Regulatory Reform of the U.S. Manufacturing Sector,"
as one that, if reformed, could enhance competitiveness of U.S.
manufacturing.
The current rule was set down in 1973, and many businesses are
unaware of it and are not in compliance. EPA has proposed
to allow small facilities with storage capacity below a certain
threshold to use streamlined, less expensive requirements. However,
a number of problems will remain, and so a "loose-ends"
rule is being considered for 2007.
To provide industry input about this rule, please contact
at 202-482-4423. [Return to list of regulatory
studies]
OSHA'S
Occupational Exposure to Crystalline Silica Rule. Crystalline
silica is a small particle of common sand. Pursuant to a court
order, OSHA must issue a final crystalline silica exposure standard.
OSHA has proposed a reduction in the current workplace exposure
standard from 100 to 50 micrograms per cubic meter. The rule will
have significant economic impacts on a substantial number of entities,
mainly construction services and mining.
To provide industry input about this rule, please contact
at 202-482-4877. [Return to list of regulatory
studies]
OSHA'S
Occupational Exposure to Beryllium Rule. OSHA has proposed
a rule to reduce the PEL to Beryllium from 2.0 micrograms/cubic
meter to a more restrictive PEL (possibly set at 0.2 micrograms/cubic
meter, as proscribed by the Department of Energy in 1999) for
workers exposed. OSHA began work on the reforming the rule in
1999 by announcing a proposed rule for public comment in 2002.
To provide industry input about this rule, please contact
at 202-482-0607. [Return to list of regulatory
studies]
DOT'S
Side Impact Safety Regulation. MAS staff have been reviewing
the Department of Transportation/NHTSA proposed side impact safety
regulation since February 2006. A very complex rulemaking, NHTSA
issued its proposed rule in May 2004 and said at the time the
new regulation could become a final rule as early as 2005. The
automakers agreed to voluntarily install side air bags in all
vehicles by September 1, 2009. But NHTSA continues to consider
a proposal that would require automakers to significantly upgrade
their side protection systems. This is the last major crash-worthiness
regulation that is in the works.
To provide industry input about this rule, please contact
n at 202-482-5898. [Return to list of regulatory
studies]
DOJ'S
Americans With Disabilities Act (ADA). The Department
of Justice is adopting rules and standards that ensure accessibility
by handicapped individuals.
To provide industry input about this rule, please contact
at 202-482-5027. [Return to list of regulatory
studies]
OSHA's
Worker Exposure to Hexavalent Chromium Rule (completed rule)
This rule was nominated in OMB's 2005 report, "Regulatory Reform
of the U.S. Manufacturing Sector," as one that, if reformed, could
enhance competitiveness of U.S. manufacturing.
Under a court order, OSHA promulgated a final rule reducing permissible
worker exposure to hexavalent chromium from 50 to 5 micrograms
per cubic meter (mcm). MAS worked with OMB, OSHA, and industry
to come up with a final rule that ensured worker safety and did
not create undue burden on U.S. businesses competitiveness. [Return
to list of regulatory studies]
FDI - Defined by the Bureau of Economic
Analysis as the purchase by a foreign resident of more than 10
percent of equity in a domestic company. [return
to FDI paragraph]