• Since President Donald Trump took office in 2017, federal regulations have seen an unprecedented decrease under his administration.
  • Over the first two years of Trump’s term, the White House says federal agencies have reduced regulatory costs by $23 billion — or about $1.6 billion each year
  • The administration’s success in rolling back regulations as promised faces one major challenge: lawsuits.

Unprecedented rollback

While President Donald Trump has faced criticism from both the right and the left over his unfulfilled campaign promises, there is one commitment he has undoubtedly made good on: deregulation. Since Trump took office in 2017, federal regulations have seen an unprecedented decrease under his administration.

One of Trump’s first executive actions, in fact, was Executive Order 13771, which stipulates that “for every new regulation issued, at least two prior regulations (must) be identified for elimination.” This means that for the first time in history, the federal government is now keeping track of both new regulations and acts of deregulation each year and reporting the ratio to the public.

“While past administrations have paid lip service to cutting red tape, the reality is that past presidents from both parties only added new layers on an out of control regulatory state,” Timothy M. Doyle, General Counsel and Vice President of Policy of the American Council for Capital Formation, wrote in the Washington Examiner. “No president since Ronald Reagan has attempted to pursue such a hefty deregulatory agenda.”

Indeed, according to a new paper published by the American Council for Capital Formation, the executive branch under Trump has created fewer regulations than either of the past two administrations of Barack Obama and George W. Bush. Doyle noted that some analysts believe it may be fewer than any president since they started tracking the number of new regulations in the 1970s.

The result is that over the first two years of Trump’s term, according to a White House report earlier this year, federal agencies have reduced regulatory costs by $23 billion in the long run — or about $1.6 billion each year. They’ve done so by achieving a roughly four-to-one ratio of significant deregulatory actions versus significant new regulations, well above the two-to-one benchmark the president established.

Legal roadblocks

The administration’s success in rolling back regulations as promised comes with one big asterisk, however: lawsuits.

“For the projected long-run savings to materialize, agencies must present careful legal justifications of their decisions to modify or rescind existing rules,” Susan Dudley, Director of the GW Regulatory Studies Center, wrote in Forbes earlier this year. She noted, however, that “their track record to date is not encouraging.”

A running tally maintained by the Institute for Policy Integrity, a nonpartisan think tank sponsored by the New York University School of Law, has found that more than 90 percent of the Trump administration’s deregulatory efforts have been blocked in court or withdrawn after a lawsuit.

The U.S. Supreme Court, with the recent appointments of Neil Gorsuch and Brett Kavanaugh, would likely lean in Trump’s favor when hearing cases related to his administration’s deregulatory efforts. But as Doyle noted, most regulatory matters do not make it as high as the Supreme Court. Instead they are more often decided by the D.C. Circuit Court of Appeals, which is currently comprised of seven Democrat-appointed judges and only four Republican-appointed judges (including the recent confirmation of Neomi Rao, Trump’s former regulatory czar).

As an example of the kinds of deregulation that could face litigation, Dudley notes two noteworthy changes to federal regulations under Trump that have sparked controversy. First, the Department of Transportation and EPA have proposed to retain model year 2020 corporate average fuel economy standards through 2026. They estimate this could save consumers up to $340 billion over the life of new vehicles. Second, the EPA is also working with the Army Corps of Engineers to narrow the broad scope of waters covered by the Clean Water Act.

Writing in Politico, John D. Graham and Keith B. Belton of the School of Public and Environmental Affairs at Indiana University offer five suggestions for how the administration can better defend its deregulatory agenda against an inevitable barrage of lawsuits:

  • First, the administration should make a point to fill vacant posts at regulatory agencies with qualified people who can make a compelling case for deregulation.
  • Second, agency leaders should create an administrative record from which factual findings can be drawn to support deregulation.
  • Third, federal agencies’ general counsels need to make sure that they have honored every procedural requirement for deregulation.
  • Fourth, the leader of the White House Office of Regulatory Affairs must work with federal agencies on regulatory impact analysis that takes into account both the cost savings from deregulation and the benefits of regulation.
  • Fifth, the administration must seriously take into account how deregulation at the federal will affect state and local regulations.

For a more granular look at specific acts of deregulation under the Trump Administration, the Brookings Institution is tracking delayed, repealed, and new rules; notable guidance and policy revocations; and important court battles across eight major categories, including environmental, health, labor, and more.


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Image credit:  “Donald Trump” by Gage Skidmore is licensed under CC BY-SA 2.0.