State of the Less Regulated Union: 6 Ways Trump Has Cut Red Tape

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Countless online previews of President Donald Trump’s State of the Union address may now be found, and all indications are that he will showcase a booming economy and tax reform, infrastructure, trade, immigration, and security.

With respect to that rosier economy, Steve Moore put it this way in The New York Times:

If Mr. Trump had continued Mr. Obama’s policies, one might not credit him for today’s strong economy. But Mr. Trump has begun to systematically overturn Obama policies on taxes, regulations, energy, climate change, net neutrality, budget priorities and health care.

Rollbacks of federal regulation are a main element of the Trump administration’s economic recipe and deserve credit. It’s highly likely that the loosening of red tape will be highlighted in the State of the Union speech.

The program to reduce regulation, or at least the intent to do so, deserves more than a brief mention. Trump’s actions on reducing regulation and taming the administrative state have consisted of six main elements by my count; one legislative, the remainder carried out by executive order and internal executive branch directives.

  1. Fourteen Obama rules and regulations that had been enacted were eliminated by the Trump administration in conjunction with Congress, which employed the Congressional Review Act’s provisions for introducing “resolutions of disapproval.” Each was signed by the president.
  2. Over 1,500 Obama rules that were not yet finalized but were in the rulemaking pipeline were withdrawn or delayed.
  3. A vastly more lenient attitude toward streamlining permitting for bridges, pipelines, transportation, 5G telecommunications, and other infrastructure is apparent, and the reprieve seems to be getting interpreted as open season for certain infrastructure planning. Costly projects requiring lone advance planning are more likely to be contemplated. One can expect Trump to spend time in the SOTU address outlining infrastructure reforms and spending.
  4. In large part, Trump agencies have simply abstained from issuing significant new rules and regulations.
  5. To the extent possible within legislative requirements, Trump required executive (not independent) agencies to eliminate at least two rules for every one issued via a now well-known executive order (E.O. 13,771). So far, the administration claims a 22-1 ratio instead, having dispensed with 67 rules and adding three “significant” ones. This rollback job will become harder in 2018 as low-hanging, quick-to-eliminate rules are addressed. Still, the administration is calling for the approach to be expanded and continued in fiscal year 2018. Of course, bigger rules like the Clean Power Plan and the Waters of the United States rule in the process of being reformed, but will require lengthy formal notice-and-comment procedures, and will face legal challenges. It will become increasingly clear that rollbacks require Congress.
  6. Trump’s executive orders and directives encompass not just rules, but executive agency guidance documents also. The administration has begun to address and limit agency use of such decrees, a concern not addressed since the George W. Bush administration issued “good guidance principles.” These agency sub-regulatory decrees are technically not meant to be binding, but can nonetheless can have real regulatory effect.

More needs to be done to curtail guidance overreach in the coming year, and there are steps that both Congress and the administration can take. Trump, in the same manner that he has been out front on rolling back ordinary red tape, should in 2018 issue an executive order implementing specific reforms on “regulatory dark matter” that nowadays fall through the oversight and disclosure cracks. Congress is beginning to act, such as with the bill by Sen. Ron Johnson (R-WI) and Rep. Mark Walker (R-NC) mandating disclosure called the “Guidance Out of Darkness” or GOOD Act, but they clearly have more work to do.

The year 2018 has brought substantial regulatory reforms, mostly from the White House alone, to the extent law allowed, and these have has positive affects on the state of the union, particularly its economic health. But bipartisan action in Congress—something Trump is also expected to call for in speech—is needed to lend permanence to the newfound breathing room for business and job expansion.

The 2018 State of the Union will be interesting, but we know what will be said. More interesting might be where things stand in 2019.