OSHA Under The Budget Ax

In the last post, I looked at OSHA’s apparent about face on its policy of publicly calling out companies that violate safety regulations.  Under the Obama Administration, OSHA sent out a news release whenever it hit a company with a large fine, but that stopped abruptly when Donald Trump was sworn-in.

OSHA is going to see some real changes this year under the new administration.  We will need to wait for the new director of OSHA to be named before we really have a clue as to the direction it takes, but my guess is that we will not see a huge roll-back in safety regulations.  There will be a few tweaks, but, as I noted in the last post, I do not see wholesale changes in regulations.  New safety laws and regulations are often spurred by accidents.  Accidents will happen.  No politician wants to be blamed for weakening safety regulations after that accident occurs.

There will be a lot of talk about rolling-back anti-business regulations and the next OSHA head will push to change the bureaucracy into a pro-business mind-set. I wouldn’t look for they to have much success.   For one thing, pushing a bureaucracy is like the Titanic trying to push the iceberg out of the way.  For another thing, most OSAH employees aren’t anti-business.  They are pro-safe business and their job is to enforce the existing rules.

The Real Changes Coming To OSHA

What I would expect to happen is that OSHA will have a lot less money to enforce its standards and inspect businesses.   Belt-tightening will have more of an impact then regulatory changes.

The Administration has said its budget will increase military budgets and decrease other domestic programs.  By one account, the cuts to domestic programs will average 10% across the board.  However, individual agency cuts could be higher, especially because the administration also wants to increase highway and other infrastructure spending.   Last year OSHA’s budget was $552 million, roughly the same budget it had for the past three years.  That means the agency could absorb a cut of $55 million or more.

The last time OSHA had its budget cut like that was during the Reagan Administration, when non-defense, non-entitlement programs were cut by just under 10%.  OSHA lost about 25% of its staff.  The graph to the right shows what happened to OSHA inspection numbers over the following years.  Labor unions claim it would take OSHA 145 years to inspect every business in the U.S. with its current number of inspectors.

Since that that graph came out in 2006, OSHA’s budget has largely been flat, even though inflation has undercut the present value of its funding level and the workforce has gone up dramatically, as this info-graphic shows:

 

Of course, the numbers of incidents has dropped dramatically.  Injuries rates have been reduced more than 50% and fatalities have decreased by about two-thirds.  OSHA gets credit for that, but if incidents are falling as OSHA’s resources have also gone down, that would indicate that individual companies are committed to providing a safe workplace whether OSHA is looking over their shoulders or not.

What will happen to OSHA’s funding?  We will know more this week when the Administration starts publicizing details of its budget plan.  Then it will be up to Congress to determine the actual spending levels.

Presidents come and go.  Change in agencies is slow and rarely successful.  The thing that doesn’t change is the old Washington two-step: Blame an agency for not being effective and then don’t give it enough money to be effective.  The real fight won’t be over repealing old regulations.  It will be over cutting the budget.

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