White House to Seek Changes
In Proposed Tire-Safety Rule

WASHINGTON -- The Bush administration said it is preparing to call for major changes in a proposed new auto-safety rule inspired by the Firestone tire recall.

The decision, requiring regulators to redraft proposed requirements that auto makers install new systems for monitoring tire pressure, is the most significant move so far in a campaign by Mr. Bush's regulatory czar, John Graham, to curb what many White House economic advisers -- and corporate donors -- have said was an undue zeal for regulation by his Democratic predecessor.

Mr. Graham heads the information and regulatory affairs office in the Office of Management and Budget, an obscure but powerful post often referred to as the "gatekeeper" for federal rules. Since taking office in July, he has directed federal agencies to reconsider proposed regulations 18 times. Most cases involved issues that were of relatively little interest to the general public, such as prohibitions on the transport of flammable liquids and certification requirements for pilots, aircraft and repairmen to operate and maintain light sport aircraft.

By contrast, the efforts of the National Highway Traffic Safety Administration to develop tough new safety measures have been watched closely by auto makers, members of Congress and ordinary citizens ever since Bridgestone/Firestone Inc. was forced to recall millions of tires linked to deadly highway accidents. A report by the Transportation Department's inspector general last month found the highway-safety agency has already fallen behind in drafting new regulations called for under a law passed shortly after the recall, in 2000.

A draft rule forwarded by NHTSA to OMB for approval in December -- originally due out in November -- would have required auto makers, beginning in model year 2004 and continuing through model year 2006, to install tire-pressure monitoring systems in vehicles. During this period, auto makers would have been allowed to continue using systems that measure the rotational differences between tires to determine whether they are dangerously underinflated, rather than actually gauge the inflation level in all four. Beginning in model year 2007, NHTSA would have required systems that actually gauge pressure in all four tires, a method that some safety experts say is better at detecting low tire pressure.

But OMB officials reviewing NHTSA's proposal concluded that the agency's approach would discourage auto makers from installing antilock brakes, according to an administration official familiar with the matter. The OMB based its conclusion on estimates submitted by NHTSA that examine the rate at which auto makers are installing antilock brakes, which aren't currently required under the law, and how the industry might react to sudden safety-related cost increases.

The differing approaches have major financial ramifications for auto makers, who lobbied the Bush administration for months to be flexible in its decision. NHTSA has estimated that its approach would cost the industry about $1 billion a year, twice as much as what auto makers would have to spend if they were allowed to use either kind of tire-pressure monitoring system.

Since the Sept. 11 terrorist attacks, the Bush administration has presided over a massive expansion in the size and power of the federal government, including the implementation of a law -- opposed by the White House -- that calls for hiring 30,000 new federal airport-security workers by November. But the administration's latest move suggests that, at least in some areas of government, the White House is still determined to continue an aggressive deregulatory campaign.

Write to Stephen Power at stephen.power@wsj.com¹

Updated February 13, 2002 12:01 a.m. EST