Thomas Lucente: Administrative state killing us

By Thomas J. Lucente Jr. - [email protected]

A federal judge in Texas put the kibosh on, at least temporarily, President Barack Obama’s effort to force employers to pay overtime wages to 4 million workers who are exempt from the extra pay because of their job duties and salary levels.

The 20-page nationwide preliminary injunction issued by U.S. District Judge Amos L. Mazzant of the Eastern District of Texas on Tuesday in the case Nevada v. U.S. Department of Labor prevents the new rule from going into effect Thursday. It means the rule will not go into effect until the court case plays out, which will be long after Obama leaves office Jan. 20.

The judge, an Obama appointee, is expected to ultimately overturn the proposed rule if the new Republican Congress, using its power under the Congressional Review Act, doesn’t beat him to the punch.

Either way, this likely means the fate of Obama’s overtime rule will fall into the lap of President-elect Donald Trump, barring a speedy appeal by Obama. While it is unclear how Trump would handle the overtime rule, he did mention it on the campaign trail as one of the many Obama regulations he would like to roll back.

However, as we are seeing, Trump is not a man of his word and has already backed out of several campaign pledges before he has even been sworn into office, just as Obama did eight years ago.

Trump campaigned as an advocate of the working class and this rule has the potential to lift millions of middle class workers out of poverty. While Republicans are generally opposed to the rule, and rightly so, Trump is neither a Republican nor a conservative. The question, then, is will the former Democrat back his current party and alienate many of those working-class voters who put him in office.

This tortured path began in 2014 when Obama directed the U.S. Department of Labor to update the rules concerning overtime pay.

The Department of Labor came up with this plan to increase the minimum salary level for exempt employees from $23,660 annually to $47,892 annually. The new salary level is based upon the 40th percentile of weekly earnings of full-time salaried workers in the lowest wage region of the country, which is, unsurprisingly, the South. The rule also establishes an automatic updating mechanism that adjusts the minimum salary level every three years with the first automatic increase to occur on Jan. 1, 2020.

The president, with little more than his signature, adopted the rule and forced companies to pay overtime to some 4.2 million workers who were previously exempt.

Democracy in action (that is sarcasm).

This is reminiscent of the ergonomics rule that President Bill Clinton tried to push onto U.S. businesses in November 2000 when the Occupational Safety and Health Administration devised a 600-page rule that would have forced companies to alter their workstations, redesign their facilities, or change their tools and equipment. The rule also would have required in part that disabled workers receive more compensation than is provided for by many state compensation laws.

Congress, using the Congressional Review Act for the first time, overturned those regulations and the newly inaugurated President George W. Bush signed the repeal to prevent the rule from going into effect. OSHA estimated the rule would cost U.S. businesses more than $4 billion a year in compliance costs while businesses said it would be closer to $100 billion.

Either way, the idea that a president can impose rules — laws really — costing businesses billions of dollars a year without congressional approval is disturbing.

Trump has indicated he intends to overturn some Obama regulations. In fact, he promises to eliminate two regulations for every one enacted.

While that is nice, we need more than a president who wants to overturn Obama’s regulations while passing new ones of his own. We need a serious change in the rule-making powers of our administrative agencies.

Last year, Congress enacted 114 new laws while 3,410 rules were issued by federal agencies. That comes to 30 rules for every law enacted in 2015. These federal regulations cost $1.89 trillion last year, which amounts to a hidden tax of $15,000 per U.S. household. That is more than the $1.82 trillion the IRS collected in income taxes from individuals and corporations combined.

The 2015 Federal Register contains 80,260 pages, the third highest page count in its history. Of the seven all-time-highest Federal Register total page counts, six occurred under Obama. While the Bush administration averaged 62 major regulations annually over eight years, the Obama administration has averaged 81 major regulations annually over seven years.

Heading into Thanksgiving, the 2016 Federal Register was at some 85,000 pages, the highest in history and there is still a month left of furious rule-making. At a pace of well more than 1,000 pages a week, the Register could top 90,000 pages for the first time in history. Indeed, this is only the fourth time in history the Register has surpassed 80,000 pages and all four times were under Obama.

Right now, some 60 federal departments, agencies, and commissions have more than 3,000 regulations in development at various stages in the pipeline.

Enough is enough.

Our Constitution grants the sole power to make laws to the U.S. Congress. According to Article 1, Section 1 of the U.S. Constitution: “All legislative Powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.”

If Trump can somehow return that power to Congress, he will be one of the most successful presidents ever. Unfortunately, to do that he would have to weaken the power of the presidency, and his own power, and it is hard to foresee any president, Trump or otherwise, wanting to do that.

By Thomas J. Lucente Jr.

[email protected]

Thomas J. Lucente Jr. is an attorney with the Hearn Law Office in Wapakoneta (419-738-8171) and night editor of The Lima News. Reach him by telephone at 567-242-0398, by email at [email protected], or on Twitter @ThomasLucente.

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