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The Kiplinger Washington Editors
Nov. 14, 2008
 

Facing the Recession :
How Bad Will It Be?

When Barack Obama takes the oath of office Jan. 20, he'll inherit the worst economy in a quarter of a century. This week’s Kiplinger Letter looks at how bad it's likely to be and what the new president might do to help spur a recovery.
 
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Federal Agencies Running on Fumes

Senior level vacancies will slow work at many regulatory agencies well into next year. Some say that's good.
 
 
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    A slew of senior job openings at federal agencies will force some regulatory offices to delay work. It's largely the result of a standoff between President Bush and the Democratic Senate, and it's likely to keep several agencies limping along dysfunctionally until a new president fills gaps in the senior ranks of the bureaucracy.

    Fully 200 vacancies exist in the upper echelons of the federal government, including at Cabinet departments, regulatory agencies, boards and commissions. That's about one-third of all jobs subject to Senate confirmation. Some 20 regulatory agencies and boards -- many of which are not household names -- lack quorums or are barely operational, which affects their ability to act on a host of issues crowding their agendas.

    The National Labor Relations Board (NLRB), for example, has not issued any decisions since September. The delay affects disposition of pending cases and litigants' complaints in the chemical, textile and steel industries. And the Occupational Safety and Health Administration (OSHA) may be slower to act on complaints of unsafe working conditions in timber yards and poultry processing plants without a full complement of board members.

    The Bush administration doesn't seem particularly unhappy with the situation. Bush has long been cool to aggressive federal regulatory action and oversight affecting business and commerce. Many of his nominees are unacceptable to Democrats, but he won't offer replacement candidates, and the topic is low on his to-do list in his final year in office.

    Agencies hit hardest in addition to the NLRB and OSHA: The Federal Trade Commission, the Commodity Futures Trading Commission, the Securities and Exchange Commission, the Federal Election Commission and the National Transportation Safety Board. Even the Federal Reserve Board of Governors has two vacancies, a problem for decisions requiring a supermajority. So, too, does the Council of Economic Advisers, which helps develop economic policy for the White House.

    Other notable vacancies are at the Federal Communications Commission, the Nuclear Regulatory Commission, the Federal Mine Safety and Health Administration, the Chemical Safety and Hazard Investigation Board, the Federal Maritime Commission and the National Highway Traffic Safety Administration.

    The later in the year it gets, the harder it will be for nominees to win confirmation, and many potential candidates may reject overtures if it means running the congressional gauntlet for a job that will last only a few months before the next administration takes office. As a final brake on the process, Democrats are using procedural mechanisms to prevent Bush from making recess appointments when Congress is out of session.

    Most of the vacancies, including chairmen, commissioners and under secretaries, will remain unfilled not only for the rest of this year, but probably also well into next year, until the next president appoints his or her own people and they win confirmation.

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