The Mielke Way: The War on Regulation
Dr. David Mielke, Retired Dean of the College of Business at Eastern Michigan University
Every year, federal agencies issue new regulations that impact consumers and businesses. President Obama presided over six of the seven highest page counts ever of regulations. President Trump and his administration have been rolling back the regulatory state at a faster pace than even President Reagan. The Trump administration has targeted everything from the internet to higher education to the EPA to the Consumer Financial Protection Bureau and more. Congress has helped with the use of the Congressional Review Act to nullify Obama era rules. Is the rollback of the rules a significant accomplishment for the Trump administration? What has been and will be the impact of these changes? Are the changes good for the economy? Should the Trump administration continue on this path to pull back on additional regulations? What is the “Right Thing to do?” Let’s look at some issues:
- In 2016 as President Obama left office, his regulators had issued a record breaking binge of 95,894 pages of new rules. President Bush wasn’t much better. Under his administration 79,435 pages were added in 2008, the most expansive regulatory year at that time. By contrast, the first year of the Trump presidency added 45,678 pages to the Federal Register.
- Ten days after his inauguration, President Trump issued an executive order directing his departments to scour the books for rules they could rescind or repeal without damaging the law. He also directed that for every single regulation issued, agencies should identify at least two for elimination.
- President Trump appointed Neomi Rao to run the White House Office of Information and Regulatory Affairs that must clear new rules. Through September 30 the Trump Administration had taken 67 deregulatory actions but added only 3 significant new regulatory actions. Ms Rao also reported that since fall 2026 more than 1,500 planned regulatory actions have been withdrawn or delayed. For fiscal year 2018, the current agenda includes 448 deregulatory actions and 131 new regulatory actions.
- One reason for the number of deregulations is the enforcement of the Administrative Procedure Act, which outlines a public comment period for proper rule making and which the Obama administration ignored. Last year, there were at least 480 Obama issued executive orders and memoranda, not counting guidance, administrative interpretations and other regulatory actions that were used to set policy.
- Ms. Rao is also requiring agencies to submit an annual regulatory budget. The budget target for 2018 is for a net reduction is regulatory costs. If enforced and successful, agencies will have to think twice about proposing new rules since they will have to eliminate regulatory costs elsewhere.
- Congress has used the Congressional Review Act to nullify 14 Obama era rules and one Consumer Protection Bureau rule. The CRA had only been used once before, in 2001 to nix a late President Clinton rule. By eliminating the 14 rules, lawmakers spared Americans from $3.7 billion in costs and 4.2 million hours of paperwork, says the American Action Forum.
- The Congressional list includes a regulation that would have imposed onerous disclosure requirements on mining and drilling companies operating overseas, carrying $700 million in initial costs and up to $590 million for annual compliance. They also killed rules on education, public land and the use of family planning funds.
- The Trump administration rescinded Education Department guidance on transgender bathrooms, as well as the “Dear Colleague” guidance that established courts on campus to adjudicate sexual assault and harassment. It also negated Labor Department guidance that held franchise companies responsible for their franchisees wage law violations.
- One of the most recent and controversial regulatory changes was the reversal of the Obama net neutrality. Under Obama, the FCC looked to write regulations that would limit the ability of internet service providers (ISPs) to play favorites with certain services. The courts blocked many of the initial efforts of the FCC. Instead, the FCC reclassified ISP’s as common carriers under Title II of the Communications Act of 1934 that forced ISPs into an 80 year old framework designed to regulate telephone monopolies of a much different era. The new Chairman of the FCC repealed Title II.
- The size of the economic impact of all this action is difficult to measure, but the Trump administration projects the regulatory cost savings to the economy will be $9.8 billion over the next fiscal year. According to the American Action Forum the estimated cost of regulation on the economy was $1.9 trillion last year.
Is it time to rein in new regulations after the Obama administration’s record year and recording 6 of the 7 highest number of pages in history? Are there concerns that the deregulation efforts have gone too far? Is it time to enforce the Administrative Procedure Act that had been ignored by the Obama administration? Should the Trump administration continue to pursue deregulation? What is the “Right Thing to do?” In my opinion, one of President Trump’s major accomplishments in his first year has been the reversal of regulation proliferation. The impact is significant, reducing costs to the economy and freeing businesses to move forward. Ms. Rao is one of the least known people in the Trump administration, yet should be recognized for her efforts. There is no question the Administrative Procedure Act should be enforced, Congress should continue to use and expand its use of the CRA and for the Trump administration should continue its War on Regulation.