DHS waives environmental protection regulations for border wall construction, SEC charges accountants in relation to KPMG audit, and more…
IN THE NEWS
- U.S. Secretary of Homeland Security Kristjen Nielsen waived more than 20 environmental protection regulations “to ensure the expeditious construction” of the border wall along the southwestern border of the United States. In response, Center for Biological Diversity attorney Brian Segee called the border wall “a humanitarian and environmental disaster.”
- The U.S. Securities and Exchange Commission (SEC) announced that it had charged six accountants—including former employees of the Public Company Accounting Oversight Board (PCAOB)—over a scheme to “misappropriate and use confidential information” that PCAOB was planning to audit accounting firm KPMG. Steven Peikin, Co-Director of the SEC’s Enforcement Division said the SEC will not “tolerate any scheme to subvert the important” auditing process.
- The U.S. Food and Drug Administration (FDA) and the Federal Trade Commission (FTC) sent warning letters to 15 companies marketing unapproved “opioid cessation products” with claims touting their capacity to treat opioid addiction and withdrawal. FDA Commissioner Scott Gottlieb said that individuals with an opioid addiction should “have access to safe and effective treatments and not be victimized by unscrupulous vendors” making “baseless claims.”
- The U.S. Senate confirmed Alex Azar as U.S. Secretary of Health and Human Services (HHS). Azar will succeed Eric D. Hargan, who has been Acting Secretary of HHS since October 2017. Speaking before the vote, Senator Ron Wyden (D-Ore.) denounced the selection of Azar as an epitome of President Donald Trump’s “broken promises on prescription drugs and health care overall.” On the other hand, Senator Orrin Hatch (R-Utah) praised Azar as “qualified,” mentioning Azar’s “two decades of experience in the healthcare system.”
- The U.S. Senate, with bipartisan support, confirmed Jerome H. Powell as Chairman of the Board of Governors of the Federal Reserve System (FRB). Powell has served as a member of the FRB since 2012, and will succeed Janet Yellen, who has served as Chairwoman since 2014. Senator Sherrod Brown (D-Ohio) reportedly endorsed Powell and said that Powell’s “track record over the past six years shows he is a thoughtful policymaker.” Senator Elizabeth Warren (D-Mass.) reportedly expressed concern that Powell would “will roll back critical rules that help guard against another financial crisis.”
- The Trump Administration imposed a 30 percent tariff on all solar panels imported to the United States. U.S. Trade Representative Robert Lighthizer contended that the tariffs would protect U.S. manufacturers from unfair trade practices that have allowed Chinese manufacturers to dominate the global supply chain of solar panels. The Solar Energy Industries Association predicted that this tariff “will cause the loss of roughly 23,000 American jobs this year, including in manufacturing, and it will result in the delay or cancellation of billions of dollars in solar investments.”
- The SEC has opened an investigation into General Electric’s (GE) disclosure that a miscalculation in its North American Life & Health (NALH) division—a division that helps cover the risks assumed by insurers that sell policies to consumers—could cost the company $15 billion. NALH underestimated the amount of money required to “pay for the care of people who lived longer than projected”—a $6.2 billion miscalculation. To make up for the shortfall, GE has planned to “divert $15 billion into North American Life through 2024.”
- The European Commission fined Qualcomm €997 million for antitrust violations in its sale of chipsets, which enable smartphones and tablets to connect to cellular networks. The Commission claimed that Qualcomm paid Apple billions of U.S. dollars for a promise that Apple would not buy chipsets from any of Qualcomm’s rivals. Commissioner Margrethe Vestager said these payments “meant that no rival could effectively challenge Qualcomm in this market, no matter how good their products were.”
- The Philadelphia Department of Public Health and the Department of Behavior Health and Intellectual disAbility Services said that, as “a harm reduction strategy,” the City will promote Comprehensive User Engagement Sites (CUES) to help people abusing opioids. At CUES, opioid users can receive medical treatment, “medically supervised drug consumption,” clean injection tools, and naloxone, a drug that stops an opioid overdose temporarily.
WHAT WE’RE READING THIS WEEK
- In a working paper, Alexander Luttmann and Cody Nehiba, both of the University of California, Irvine School of Social Sciences, examined hours-of-service regulations for airline employees—regulations that limit how many hours a pilot may fly—and argued that these regulations, which were implemented in 2013, disproportionately affected regional and low-cost airlines. Luttman and Nehiba found a “significant reduction” in the total number and an increase in the overall fare of regional and low-cost airline flights.
- In an article for the University of Michigan Journal of Law Reform, David A. Friedman, professor and Director of the Law and Business Program at the Willamette University College of Law, explored “mediated reputation systems”—entities that provide consumers access to peer experiences, such as Yelp or Angie’s List—and the conflict caused by their reliance on advertising sales to support their business. Friedman argued that businesses seeking to advertise on these platforms should experience more “rigorous regulation” such as disclosure requirements and “prioritized enforcement.”
- In an article for POLITICO, Danny Vinik asked if President Donald Trump’s “war on regulations” is “working.” Vinik noted that the Trump Administration has not scrapped existing rules but rather “put a cork in the federal regulatory process.” Vinik also discussed the roles that other Administration officials—like Neomi Rao, director of the Office of Information and Regulatory Affairs—play in the regulatory “rollbacks.” Still, Vinik observed the hurdles facing the Administration’s deregulatory efforts, and he wondered if those hurdles would instead signal “that even the most deregulatory administration in a generation couldn’t find a bunch of expensive rules worth cutting.”