A Blueprint for Reforming the Federal Government

This is a big week for the executive branch of the federal government. Yesterday, President Trump signed an executive order entitled “Comprehensive Plan for Reorganizing the Executive Branch” and this morning CEI released my colleague Wayne Crews’ newest study on regulatory reform, Mapping Washington’s Lawlessness: An Inventory of “Regulatory Dark Matter.”

The new directive from the White House puts the director of the Office of Management and Budget in charge of creating a plan for merging, streamlining, eliminating, and otherwise reorganizing all of the cabinet departments, agencies, and programs reporting to the president. That’s a big job. The fact that it’s so big, however, is the clearest argument for why it’s also necessary. As CEI president Kent Lassman said yesterday:

The burden of the federal government on the economy has grown like kudzu over the past two decades, under both parties, and it needs to be thinned to allow room for innovation and dynamic enterprise. The President’s executive order to reorganize the executive branch is an encouraging sign for consumers, taxpayers and businesses alike because it shows he is focused on the serious negative effects of too much complex regulation.

Every agency head will have approximately six months to submit a plan of proposed changes. The OMB will also invite the public to submit comments on how the “organization and functioning” of the executive branch can be improved. The White House is in luck—their first set of recommendations is already prepared in the form of Wayne’s new study:

This analysis covers how, in addition to Congress’s own laws and the many thousands of rules issued by unelected regulators, regulatory dark matter exists in the form of thousands of additional issuances from executive and independent agencies. This dark matter goes around Congress, the Administrative Procedure Act’s (APA) public notice and comment requirements, and the American people themselves.

Examples include presidential and agency memoranda, guidance documents, bulletins, and public notices. These directives interject the federal government into our businesses, our communities, and our personal lives on matters such as healthcare, retirement, labor policy, education policy, and more.

Solving this problem will involve both executive branch initiatives and legislation from Congress. Yesterday’s executive order is just one of the actions aimed at reforming the kind of overreach that today’s new study describes. Writing today in Forbes, Wayne summarizes the state of play:

While the new order is more of a streamlining to improve “services,” it should have heft for cutting agency regulatory invasiveness, too.

Beyond talk, there’s been action; along with today’s executive order, President Donald Trump has issued aggressive ones requiring deregulation task forces at agencies; eliminating two rules to offset burdens of each new one; and a temporary regulatory moratorium.

The Federal Register reflects it; apart from FAA airworthiness directives and Coast Guard drawbridge proclamations and fishery designations, new regulation has essentially stopped under Trump.

Congress already passed several reform bills that await Senate action; and over a dozen nullifications of individual rules are in play.

Bills passed by the House this session include the Regulatory Accountability Act, which itself incorporates several previously passed reform proposals. The full House version of the RAA may face a tough reception in the more narrowly-divided Senate, but its many sections will at least provide the basis for negotiations between Republicans and Democrats. In additional to the resolutions of disapproval under the Congressional Review Act that Wayne links to above, we will likely see more attemps to overturn late-stage Obama rules in coming weeks.

On that theme, the Congressional Review Act itself may have dramatically greater applicability that previously thought. Used successfully only once before this year, it has already gotten a workout in the 115th Congress. Normally the CRA only applies to rules that were finalized in the previous 60 legislative days (in effect, the past several months). But according to Todd Gaziano of the Pacific Legal Foundation, who helped write the Congressional Review Act when he was a Capitol Hill staffer in the 1990s, the failure of many agencies to officially submit their regulations to Congress as the law requires may open another set of opportunities:

The window for Congress to disapprove a rule using expedited procedures is triggered by the later of the rule’s submission to Congress or publication in the Federal Register. Thus, for all the many rules that agencies failed to submit, the time for Congress to disapprove them has not yet begun to run. The Trump administration can go back over all the unsubmitted, burdensome rules issued since 1996 and belatedly submit them to Congress for its disapproval. That would allow the President and Congress to effectively block any substantially similar rule in the future.

According to Gaziano, now promoting the “Red Tape Rollback” project, there are thousands of agency rules that were never properly submitted to Congress, among them many substantive regulations with large economic impacts on the U.S. economy. As Wall Street Journal columnist Kim Strassel recently wrote, this is a “game-changer” when it comes to the potential for Congress to challenge two decades of overregulation.

All of this potential for reform comes with a burden—we all have to do the work to make it happen. From OMB director Mick Mulvaney, to every agency head, to the relevant House and Senate committees and leadership, to organizations like CEI and others across the country, we all have a role to play. Americans want a leaner, more efficient, less expensive federal government. More importantly, we all deserve a government that respects the limits of the law and discharges its responsibilities in the daylight. It’s going to be an interesting 180 days.