The Trump Regulatory Record
By Thomas Firey
Before Thanksgiving, a business reporter contacted me for an article he was writing on discussion points for families that wanted to talk politics around the holiday table. He asked me specifically to write up some thoughts about the Trump administration’s regulatory policies, and I did. He ended up not using them, even though I thought they were pretty provocative; in essence, I argued the Trump regulatory record was much less significant than what both the administration’s supporters and critics claim.
I thought they’d make for some good EconLog discussion, so I’m sharing them here:
As a policy analyst, I judge regulations on the question of whether they improve human welfare on net, compared to alternatives. This can lead me to applaud some regulations, criticize others, and call for reform—including deregulation—of still others. (As a libertarian-leaning analyst, I tend to do more of the latter two, but all three happen.)
Republicans tend to see regulation in general as harmful to human welfare, and they mainly criticize regulation and promote deregulation. By this Republican standard, there are two ways to judge the Trump administration’s record: what new regulations have they blocked, and what deregulations are they implementing?
On blocking new regulations, the administration’s record is astounding: rulemaking has largely ground to a halt. This is historic; no previous administration has come anywhere close to this decrease in output.
However, on actual deregulation—reform or removal of regulations already on the books—the administration has done little, and the successes it claims to have had are largely meaningless. Take, for instance, the ending of the Obama administration’s Clean Power Plan targeting coal-fired power plants. Though CPP is gone, coal plants continue to disappear and be replaced in part by cleaner, gas-fired “co-generation” plants. Gas simply makes better economic sense than coal, so the Trump CPP maneuver is largely meaningless (as was the original Obama CPP).
If you believe federal regulation can be more efficient—that we can improve public welfare at a lower economic cost—the Trump record on deregulation is very disappointing but not surprising. Deregulation is hard work, time consuming, and requires political consensus-building, like we had during the major deregulations of the 1970s–1990s. The Trump administration has shown little ability to do those things, and that’s unlikely to change in the future.
That said, there is a significant Trump deregulation effort now in the pipeline: the proposed change to the Waters of the United States (WOTUS) rule, overturning an Obama administration rule on what water bodies fall under federal regulation as opposed to state regulation. This would be serious deregulation, addressing problems with the Obama rule on both constitutional and public welfare grounds, and a lot of work has gone into it. But can the Trump administration ultimately deliver on it and, if so, will it survive for long after he leaves office?