Publications :  The Watcher :  OMB Watcher Vol. 8: 2007 :  September 11, 2007 Vol. 8, No. 18 : 

In This Issue

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Parts of Patriot Act Ruled Unconstitutional (09/11/2007)
On Sept. 6, the U.S. District Court for the Southern District of New York ruled that a controversial section of the USA PATRIOT Act is unconstitutional. In John Doe v. Gonzales, Judge Victor Morrerro ruled that the National Security Letter (NSL) provisions of the USA PATRIOT Act are in violation of the separation of powers doctrine and the First Amendment's protection of free speech.

Wiretapping Made Simple (09/11/2007)
On Aug. 6, President Bush signed the Protect America Act of 2007 (PAA), granting the government the authority to wiretap anyone, including U.S. citizens, without any court approval as long as the "target" of the surveillance is located outside the U.S. The legislation will expire in six months, but members of Congress and concerned public interest groups are not waiting for the sunsets. They are seeking immediate revisions to address the invasion of privacy and erosion of civil liberties contained in the act.

EPA's Second Round of 9/11 Testing Falls Short (09/11/2007)
According to a Sept. 5 Government Accountability Office (GAO) report, the U.S. Environmental Protection Agency's (EPA) second program to test and clean building interiors contaminated by toxins from the World Trade Center (WTC) collapse was a virtual failure. The program's problems stemmed from EPA's inadequate public notification and refusal to listen to its own science experts. The GAO report also indicated that EPA was reluctant to accept cleanup responsibility according to expert recommendations. The result was a limited program grossly underutilized by the public.

OMB Watch Releases 'An Attack on Cancer Research' (09/11/2007)
OMB Watch released a report in late August that further documents industry's attempt to restrict access to health and safety information produced by the National Toxicology Program (NTP). The report comes just as Congress is investigating allegations of mismanagement, industry influence, and suppression of whistleblowers at the National Institute of Environmental Health Sciences and the NTP.

Federal Agencies Knew of Diacetyl Dangers and Kept Silent (09/11/2007)
Federal regulatory agencies have known for years the dangers that diacetyl exposure creates among workers in factories where bags of microwave popcorn are tested. The only agency to have taken any action, the U.S. Environmental Protection Agency (EPA), has kept its study of the chemical's impact on consumers secret except for sharing it with the popcorn industry. Now the first case of potential consumer illness from exposure to diacetyl has been documented.

Bush's Anti-Regulatory Ideology under Increasing Scrutiny (09/11/2007)
The public and the media are paying more attention to and showing increasing frustration with the anti-regulatory ideology of President George W. Bush. A new report by the Center for American Progress traces several recent failures of the federal government to the anti-government views of Bush and senior administration officials. Separately, increasing concern over the federal product safety net is causing many to question Bush's seriousness about using government resources to protect American consumers.

It's Industry vs. Consumers and Health Specialists in National Ozone Hearings (09/11/2007)
Recent field hearings in five major U.S. cities highlighted the debate over the need to write a more stringent air quality standard for ozone. The U.S. Environmental Protection Agency (EPA) is under court order to issue an updated standard by March 2008. Industry representatives used two familiar arguments to urge EPA to leave the existing ten-year old ozone standard untouched, while public health experts and citizens argued the health impacts under the current standard are potentially devastating.

New Small Business Program Will Influence Agency Regulatory Reviews (09/11/2007)
The Small Business Administration's (SBA) Office of Advocacy has launched a new program that may expand SBA's influence into agency regulatory activity. The Office of Advocacy acts as a liaison between the business community and the federal government, particularly the executive branch.

Nussle Approved as Budget Head, Faces Task of Completing FY 2008 Budget (09/11/2007)
In the Senate's first vote following the August recess, former Rep. Jim Nussle (R-IA) was confirmed as director of the Office and Management and Budget (OMB), 69-24, with all Republican senators voting in favor of Nussle and the Democrats split down the middle. Notably, Senate Majority Leader Harry Reid (D-NV), Appropriations Committee Chair Robert Byrd (D-WV), and Senate Budget Committee Chair Kent Conrad (D-ND) voted against the nominee. Nussle's approval sets up what is expected to be a bitter struggle to complete work on the FY 2008 budget during the fall.

Continuing Resolution a Virtual Certainty; Congress Continues to Work for Appropriations Passage (09/11/2007)
A plethora of veto threats and the Senate's dithering over spending legislation have combined to all but guarantee the necessity of enacting a continuing resolution before the start of the new fiscal year on Oct. 1. While Senate Majority Leader Harry Reid (D-NV) has indicated that a continuing resolution will likely fund government operations for weeks, not months, time is not their only obstacle. Although it remains unclear how long it will take the Senate to complete its appropriations work, congressional leaders will also have to formulate a strategy to overcome President Bush's veto threats to see their spending priorities ultimately enacted.

Carried Interest Issue Gets Full Hearing(s) in Congress (09/11/2007)
On Sept. 6, the carried interest tax loophole took center stage, featuring a four-panel, 20-witness marathon hearing in the House Ways and Means Committee and the third hearing this year on the topic in the Senate Finance Committee. The day before the hearings, over 300 national, state and local nonprofit organizations sent a letter to Congress urging it to close the loophole in order to bring equity to the tax code.

Census Report Shows Working Americans Falling Behind (09/11/2007)
The U.S. Census Bureau released its annual report, Income, Poverty, and Health Insurance Coverage in the United States 2006 on Aug. 28. The report, which covers the most recent Current Population Survey (CPS) data, showed slight overall improvement in income and poverty, but continued declining rates of health insurance coverage. The headline numbers — a 0.7 percent increase in median household income and a 0.3 percent decline in poverty — are undermined, however, by the underlying story that middle- and low-income working Americans are not seeing substantial gains from the current economy.

Americans Dislike Rising Inequality, Contrary to Popular Belief (09/11/2007)
It is commonly assumed that Americans do not oppose increasing inequality. After all, a consensus among social scientists exists that most Americans favor equality of opportunity over equality of outcome, and the public has supported welfare state retrenchment and regressive tax cuts, both of which increase inequality. However, this belief may be a misinterpretation of American values and policy preferences.

FEC Proposes Rulemaking on Elections and Issue Advocacy (09/11/2007)
On Aug. 23, the Federal Election Commission (FEC) issued a Notice of Proposed Rulemaking (NPRM) stating the agency's intent to make its regulations consistent with the recent U.S. Supreme Court decision in FEC v. Wisconsin Right to Life (WRTL II). The FEC seeks public comment on two alternative proposals by Oct. 1. The FEC will hold a hearing on Oct. 17, and it plans to vote on a final rule by the end of November, in time for the presidential primaries. The difference between the alternative proposals is that one would require sponsors of grassroots, non-electoral broadcasts to file disclosure reports on their funding sources to the FEC; the other approach amends the definition of electioneering communications to allow issue advocacy and would not require disclosure to the FEC.

USAID Temporarily Delays Implementation of Partner Vetting System (09/11/2007)
The U.S. Agency for International Development (USAID) has agreed to temporarily delay implementation of a new database, called the Partner Vetting System (PVS), that would "[ensure] that neither USAID funds nor USAID-funded activities inadvertently or otherwise provide support to entities or individuals associated with terrorism." Under the plan, initially announced on July 17, all nonprofits that apply for grants, contracts or other financial partnership with USAID would have to provide the government with highly detailed personal information about employees, executives, trustees, subcontractors and others associated with the organization. On July 20, USAID also proposed to exempt portions of the PVS database from the Privacy Act. USAID is accepting comment on the Privacy Act exemption until Sept. 18. Charities are actively objecting to this burdensome and unwarranted program in which thousands of nonprofit workers would have to be screened. USAID is moving forward with a pilot program for aid recipients working in the West Bank and the Gaza Strip before expanding it globally as first intended.

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