The Environmental Protection Agency (EPA) announced today that it will begin accepting public comments on its proposal to require pesticide manufacturers to label pesticide ingredients. Currently, pesticide makers must label the "active" ingredients in a pesticide, but they are not required to identify the so called inert ingredients. "Inerts" often are toxic or otherwise harmful substances in their own right.

According to EPA, "Consumers deserve to know the identities of ingredients in pesticide formulations, including inert ingredients." Such disclosure "will empower consumers and pesticide users to make more informed choices.” [news release]

The EPA will soon publish in the Federal Register an Advance Notice of Proposed Rulemaking (ANPRM), which is an early step toward reaching a final rule. As soon as the agency's proposal is published, the public will have 60 days to comment. EPA will likely seek comment on options for requiring disclosure of inert ingredients, such as which inert ingredients must be disclosed and whether a voluntary disclosure program would be adequate.

This proposed rulemaking is the agency's response to a pair of petitions, one submitted by the nonprofit group, Northwest Coalition for Alternatives to Pesticides, and a second by several State Attorneys General. The petitions called for requiring disclosure on labels of more than 350 inert pesticide ingredients that have been deemed hazardous.

The agency's response to the petitions is underlain by the sound understanding that the public has a right to know what is in the products they are using – especially if those ingredients are hazardous – and informed consumers can make better, safer choices. Moreover, those informed purchasing decisions will pressure pesticide manufacturers, who will no longer be allowed to hide hazardous ingredients as "trade secrets," to use less toxic inert ingredients in the products they manufacture.

While most of the nation's attention seems to have been focused on health care and budget issues as of late, the Office of Management and Budget has been hard at work on the Recovery Act recently. With the start of the second recipient reporting cycle rapidly approaching, on Friday OMB put out a new Recovery Act guidance, this one specifically addressing job creation estimates and data quality issues. These two areas have been huge problems for OMB and the Recovery Act in general, with many of the story lines from the last cycle focusing on terrible data quality and suspect job creation estimates. With the new guidance, OMB is hoping to head off some of these stories for the coming reporting cycle.

Overall, the guidance is very helpful. First, it lays out ways in which agencies can help recipients report better data. Agencies now are supposed to highlight for recipients data elements that have been shown to have significant errors, such as recipient name, award amount, and job creation estimates, with the hope that recipients will pay more attention to these sections when entering their data. The agencies also are instructed to have recipients examine their reports for logical inconsistencies, such as if a recipient reports having created a large number of jobs despite not yet starting a project.

Most of the document though, fourteen pages of the twenty-four page document, are dedicated to guidance on job creation estimates (so called "full time equivalents," or FTEs). The new guidance is surprisingly in-depth, providing multiple examples covering a range of possible scenarios. It even includes a worksheet at the end giving step-by-step instructions for how recipients should go about calculating FTEs.

Perhaps the most significant change in the new guidance is in this FTE section. In the previous reporting cycle, many recipients were confused about the distinction the OMB made between jobs created and jobs retained. Earlier guidance was not very clear about when a job should be counted as created or saved. Under the new guidance, however, this distinction is largely eliminated. Recipients now simply report FTEs based on the hours worked on Recovery Act funded projects, regardless of whether those hours were worked by a new or retained employee.

That said, the new guidance isn't perfect. Among other problems, the guidance is very, very late. OMB released it on the night of December 18, a Friday night a week before Christmas, meaning that agencies have less than a week to act on the new guidelines before the second reporting cycle beings on January 1. Because of this short turnaround time, it doesn't seem likely that much of this clarifying guidance will make it down to the recipients in time for the upcoming cycle.

At the same time, the guidance also includes several December 22 deadlines, which is today, the Tuesday after the Friday OMB published it. I imagine many agencies will not meet these deadlines, since, thanks to the epic Snowpocalypse of 2009, the federal government was not open on Monday, and is still not operating at full strength.

Finally, and perhaps most disappointingly, the guidance still does not provide for a standardized FTE. OMB still leaves it up to the recipient to decide how many hours constitute a "full time" job (although the new guidance changes the period of time an FTE should be measured by to a quarter, down from the life of a project). So despite all of the changes and positive clarifications delivered through the guidance, it will still be impossible to compare FTEs between recipients.

On Thursday, Sen. Joe Lieberman (I-CT), in an attempt to become more "relevant," held a hearing in search of fiscal remedies to the country's growing $12 trillion debt. Rather than provide a platform for exploring different options, though, Lieberman lined up witnesses to trumpet a special congressional commission that could railroad budget "solutions" through Congress. Lieberman, along with several of his hearing witnesses, has joined a small but vocal choir of deficit-hawk-converts that are demanding the government address budget shortfalls immediately, seemingly without regard to current fiscal circumstances.

The first panel at Lieberman's economic scare-fest was the chair and ranking member of the Senate Budget Committee, Sens. Kent Conrad (D-ND) and Judd Gregg (R-NH) respectively, who talked up their recently introduced legislation to create the Bipartisan Task Force for Responsible Fiscal Action (BTFRFA?). When debuted, Jonathan Chait at The New Republic labeled the bill "insane" because it would require 14 out of 18 commission members to agree on any recommendations before the group could send them off to Congress, and then would require supermajorities in both chambers to pass any commission proposals.

As Chait facetiously remarked, the only way Conrad and Gregg could have set the bar any higher would have been to "require the commission members to create a cold fusion reactor or retrieve a magical ring from inside a volcano." But it's important to note that the two senators may have inserted those tough requirements because they recognized that a small group of sitting politicians entrusted with binding recommendation powers over the budget process could produce some horrendous results.

In an earlier piece on deficit commissions, I claimed that it would be difficult for a small group of congressional members "to make sound decisions about long-term deficit policy" because they're "prey to the powers of moneyed interests and subject to the short-term whims of electoral politics." If Congress tasks a commission to look at "all aspects of the current and long-term financial condition of the federal government," I want to know that cuts to discretionary spending are just as likely to come from defense as they are from social programs; the Conrad/Gregg commission all but guarantees that that wouldn't be the case.

Moreover, I hardly believe now is the time for such a commission. I wrote earlier this month that Speaker Nancy Pelosi (D-CA) had it right when she argued that Congress has to focus on job production before it starts to cut spending in order to balance the budget. Despite what some economists may claim about the end of the Great Recession, the country is still hurting in terms of employment and the government must continue to inject money into the economy to keep it going. Once unemployment is under control and the economy is relatively stable, Congress can begin to tackle the deficit through some combination of entitlement/spending cuts and tax increases.

Image by Flickr user BiggerPictureImages.com used under a Creative Commons license.

According to a Wall Street Journal article published this morning, efforts to pass some sort of estate tax extension in the upper chamber broke down late Wednesday afternoon. It seems the Democratic caucus can't agree on whether to permanently or temporarily extend 2009 estate tax levels. Though legislators are already promising to address the issue as soon as they return from the holidays, there is still time left to pass something. OMB Watch and a host of other organizations have submitted a letter to the Senate urging them to take action. Ironically enough for those who would champion the tax's death on Jan. 1, the consequences of inaction for small businesses and farms are costlier than extension.

In a new report from the authoritative Center on Budget and Policy Priorities (CBPP), Chuck Marr and Gillian Brunet show that "the number of people likely to face tax increases [because] of congressional inaction on the estate tax far exceeds the number of wealthy people who would secure a tax cut." This is due to a "little-known provision" in the 2001 Bush Tax Cuts that would pile up a new capital gains tax burden on many small businesses and family farms that never would have owed any estate tax.

The current estate tax exemption of $7 million for couples ($3.5 million for individuals) touches only a tiny number of estates in this country each year. Moreover, the small numbers of estates that owe any tax pay "less than one-fifth of the estate’s value...in estate taxes." However, expiration of the estate tax will trigger a change in the tax treatment of unrealized capital gains in estates.

Currently, heirs of an estate do not pay taxes on unrealized capital gains. This means that if an estate passes on a stock that the decedent purchased for $10 but is now worth $100, the heir does not pay taxes on the $90 of appreciation when selling the stock. With expiration of the estate tax, heirs will now have to pay taxes on that appreciation. This is particularly important to family farms and small businesses because often, "the primary asset in a family farm or small business estate is the farm or business itself, which has increased substantially in value over time but the owner has never paid capital gains tax on that increase."

There are exemptions that would moderate the impact of the tax, but, according to CBPP, the change in the tax treatment of unrealized capital gains in estates would rope in some 62,500 new estates, and farms and small business estates would "constitute a disproportionately large share of this group." Indeed, the only group the expiration of the estate tax would help would be the wealthiest 4,590 estates in the country.

Opponents of the estate tax in the Senate, mainly conservative Democrats and the Republican caucus, have refused to work with the Democratic leadership to extend the tax even temporarily to allow further debate on the issue. The Wall Street Journal article cited Republicans "cheering" the impending temporary demise of the estate tax because it would provide leverage for achieving a lower rate when the expected reintroduction of the estate tax occurs. It's sad that opponents of the estate tax who say they are advocates of farms and small family businesses would play with the livelihoods of farmers and small business owners just to score political points in the future.

Image by Flickr user Tammra McCauley used under a Creative Commons license.