Week in Review

IN THE NEWS

• The U.S. Supreme Court ruled that the Consumer Financial Protection Bureau’s (CFPB) funding mechanism does not violate the U.S. Constitution—reversing a federal appellate court decision which held the CFPB’s funding mechanism unconstitutional because it comes from bank fees collected by the Federal Reserve instead of the congressional appropriations process. The Court found that the Constitution’s language that “no money shall be withdrawn from the Treasury, but in Consequence of Appropriations made by Law” has been and can be “exercised with a wide range of discretion.” Justice Alito, joined by Justice Gorsuch, filed a dissenting opinion, arguing that the drafters of the Constitution would be “shocked, even horrified” by the funding mechanism and that the CFPB is granted far too much financial independence.
• The Federal Housing Finance Agency (FHFA) published a final rule removing obstacles to housing opportunities for impoverished communities. The rule encourages greater accountability for public transparency in the Equitable Housing Finance Plan program, and includes the oversight of deceptive practices to FHFA’s fair lending and fair housing programs. For instance, in an attempt to increase public transparency, the rule requires banks to annually report on the actions they do take to remove barriers to housing opportunity for impoverished communities.
• President Joseph P. Biden directed U.S. Trade Representative Katherine Tai to increase tariffs on imports from China, including electric vehicles, semiconductors, and medical products. President Biden has continued the tariffs that former President Donald Trump placed on imports from China. The Biden Administration cited China’s “unfair trade practices” and “artificially low-priced exports” as the reasons for maintaining the tariffs and stated that this action would protect workers and businesses in the United States.
• The Federal Energy Regulatory Commission (FERC) released a final rule attempting to improve electric grids to ensure that new renewable energy sources can be used. Many sections of the United States’ current power grid cannot handle the energy produced from new renewable energy sources. The new regulation requires regional grid operators to predict the transmission needs of their region for the next twenty years and to support renewable energy in their existing infrastructure.
• The U.S. Department of Defense published a final rule amending the process for active duty service members to bring medical malpractice claims for injuries that occurred in military medical treatment facilities. Under the previous rule, all medical malpractice payments received from the Defense Department and the Department of Veteran Affairs were subtracted from the total claim amount—a process known as offsetting. The amendments eliminate the offset requirement for payments of noneconomic damages. The amendments also allow service members to receive compensation for noneconomic damages, including “pain and suffering, physical discomfort, mental and emotional trauma or distress, and loss of enjoyment of life.”
• The U.S. Department of State issued a final rule allowing third parties, including private attorneys and interpreters, to attend certain appointments at passport agencies and U.S. embassies and consulates. The rule covers  appointments such as those for applications for a U.S. passport, requests for a consular report of birth abroad, or a certificate of loss of nationality. Individuals must hire a third party at their own expense, provide advance notice of a third party’s intent to attend, and appear in person at their appointment regardless of the third party’s presence. All questions will be directed to the individual requesting services, and the officer conducting the interview has discretion to interview the person without the third party present.
• Florida Governor Ron DeSantis signed a law eliminating previously required climate change considerations and prohibiting renewable energy programs and policies. The new law removes language requiring the legislature to consider the effects of climate change when enacting policies that impact energy infrastructure. The law also prohibits the construction or expansion of all offshore wind energy facilities or wind energy facilities within one mile of the state’s coastline or the intracoastal waterways. In addition, the law eliminates a previous requirement that state agencies purchase fuel-efficient vehicles and climate-friendly products.
• The Centers for Medicare and Medicaid Services issued a rule to improve care access for people enrolled in Medicaid and the Children’s Health Insurance Program. The rule  expands the scope of Medicaid Advisory Committees, which advise states about medical care and policy decisions. To create more transparency for beneficiaries, the rule requires that states publish all Medicaid fee-for-service payment rates and publicly compare these rates to Medicare rates. The rule also creates a uniform assessment and supervision system for Medicaid home and community-based services to ensure that these services effectively serve the needs of beneficiaries.
• The Centers for Medicare & Medicaid Services also issued a final rule to improve the quality of managed care plans, which are health plans administered by outside vendors that contract with state Medicaid agencies. To promote transparency, the rule requires that state agencies maintain a website detailing managed care plan information. The rule also increases reporting requirements for state-directed payments, which are a way for states to dictate how managed care organizations pay providers. The new requirements mandate detailed reporting of spending and of the taxes on providers that fund these payments.

WHAT WE’RE READING THIS WEEK

• In a recent report published by the Urban Institute, Shayne Spaulding, a Senior Fellow at the Urban Institute and several coauthors tackled the issue of equitable access to climate infrastructure jobs in the wake of the Infrastructure Investment and Jobs Act of 2021 and the Inflation Reduction Act of 2022.  The Spaulding team found that many of the affected industries offer high-quality employment but that women and people of color are underrepresented in these industries. Spaulding and her co-authors recommend that to promote equitable hiring, policymakers should position grant programs to prioritize equity and develop training programs that cultivate a diverse workforce.
• In a recent Brookings Institution report, Michael J. Ahn, an associate professor at the University of Massachusetts Boston, proposed that a tax on companies using artificial intelligence would compensate displaced workers and encourage companies to make thoughtful decisions when implementing artificial intelligence systems. Ahn argued that, to implement such a tax, artificial intelligence systems need to be granted legal personality due to the independent decision-making capabilities that artificial intelligence systems possess. To provide legal personality to artificial intelligence systems, Ahn explained that subsequent legislation must define the range of the rights and responsibilities of the different artificial intelligence systems. Ahn contended that the legal recognition of artificial intelligence may also promote regulations that curtail other negative effects of artificial intelligence.
• In a recent National Bureau of Economic Research working paper, Patrick Carlin, assistant professor at the School of Economic Sciences at Washington State University, and four coauthors analyzed the social costs of masking regulations during the COVID-19 pandemic. Carlin collected demographic information and survey data from over 4,000 people in 2022, assessing respondents’ beliefs about masking. Carlin and his coauthors found that 56 percent of respondents would not pay any amount to be exempt from a three-month mandate. The findings, however, varied by age group: 18-29 year olds were willing to pay an average of $1,200 to be exempt, while respondents over 65 years old were willing to pay an average of $50. Carlin determined that, based on his study’s results, a three-month mask mandate would need to save just over 13,000 lives to be cost effective.

EDITOR’S CHOICE

• In an essay in The Regulatory Review, Rangita de Silva de Alwis, a faculty member at the University of Pennsylvania Carey Law School, and Elodie Vialle, a senior advisor to PEN America, discussed the threat that artificial intelligence based misinformation poses to women. For example, Silva de Alwis and Vialle explained that 98 percent of fake videos created using artificial intelligence were pornographic, and, of those, 99 percent featured women or girls. Silva de Alwis and Vialle contended that these fake videos have the potential to bolster harassment that female journalists face. De Alwis and Vialle argued that, to remedy the issue, legislation must address the intersection of artificial intelligence and gender.