Despite Electoral Losses, Don’t Expect the Trump Administration to Give Up on Its Objectives

by Simon F. Haeder and Susan Webb Yackee

With the 2018 midterm election dealing a setback to Republican legislative future in the U.S., questions emerge whether Democrats’ hope of halting the Trump agenda are finally coming to fruition.

While this may be true with regard to statutory changes such as Republican hopes to undo the Affordable Care Act and further tax reform, our research suggests that the Trump Administration retains important instruments at its disposal to continue work on many of its priorities. Perhaps most crucially, despite Democratic gains in the House of Representatives, the Trump administration will still be able to move ahead with one of its prime targets: deregulation.

What Is Regulation and Why Does It Matter?

Rulemaking is a crucial, if often overlooked, part of making public policy. When Congress passes a law, it tasks a specific agency with implementing the law. A crucial reasons for this delegation is that agencies are staffed primarily by subject-matter experts. As a result, the executive branch is tasked with actually figuring out how to put a law to work, through steps that can profoundly shape what affect that law has in the real world. The relevant agency examines the law and often publishes a “Notice of Proposed Rulemaking” in the Federal Register that solicits public comments. This draft provides a general indications of the agency’s expectations for the regulation. After “considering” those comments, the agency may then promulgate a legally binding “Final Rule” that defines how the law will be put into action.

Because thousands of rules – which, at times, approach 100,000 pages in length – are issued each year, one might assume that the agencies craft these regulations somewhat autonomously, relying on civil servants’ neutral expertise. However, the White House rarely leaves rulemaking to chance. A Clinton-era executive order requires an oscure agency within the White House called the Office of Information and Regulatory Affairs (or OIRA) to act as a gatekeeper by reviewing all “significant” government regulations, including those issued by federal entities such as the Department of Health and Human Services and the Department of Education, before they are finalized. One of the reasons for the executive order was to bring more transparency to a process that had been relatively clandestine under previous administrations. This executive order also authorizes OIRA to offer “suggested policy changes” to the issuing agency, so that the agency can modify its rules to better fit “presidential priorities” and other goals.

The Crucial Role of OIRA

Scholars have long argued that OIRA plays a crucial role in the regulatory process. However, few empirical studies have shed light on the role that OIRA plays and what power it wields over the rulemaking process.

To determine how OIRA exercised its power, we studied more than 1,500 final regulations that OIRA reviewed between 2005 and 2011, under Presidents George W. Bush and Barack Obama. We determined whether OMB sent the rules back to agencies with suggested changes or accepted them as is. We also analyzed a set of just over 120 significant rules, using plagiarism software to see whether the agencies accepted OMB’s suggested changes. Our goal: assess whether OMB was more likely to request changes in rules issued by liberal, neutral, or conservative agencies. We used two standard metrics for determining agency ideology: one based on expert opinions and one based on a survey of federal executives.

Assessing OIRA’s role during this regulatory pre-clearance process, we find that OIRA frequently recommends substantive changes to the content of rules being written across the federal government, and we also find that these “recommended changes” almost always make it into the text of the finalized rules.  Moreover, our results suggest that OIRA is significantly more likely to recommend changes to rules being proposed by agencies that are traditionally believed to be more left of center in their political orientation, such as the U.S. Environmental Protection Agency (EPA), than those proposed by politically neutral or conservative agencies (such as the U.S. Departments of Transportation or Defense).  However, what may be most interesting about in our study is that Presidents from both sides of the political aisle appear to display this tendency. In total, this new article suggests an important—and relatively hidden—path where regulatory efforts may be curtailed (or possibility augmented) during a largely out-of-sight administrative process.

These findings are in line with our previous findings, which we have written about previously in this venue, that business interests appear to be particularly successful at lobbying for their interests in front of OMB. In our previous study, we found, using plagiarism software, that the (1) draft Final Rules that agencies submit to OIRA for review and (2) the Final Rules promulgated after OIRA’s “suggested changes” often differ on substantive grounds.  We also show that—while many rules receive no lobbying during OIRA review—for those that do, more interest group lobbying is associated with a greater degree of policy change during OIRA’s Final Rule review. We also demonstrate that when only business groups lobby, we are more likely to see rule change; however, the same is not true for public interest groups.

The Trump Administration and Deregulation

Since taking office last year, the Trump administration has been working to undo many Obama-era regulations affecting clean water, national parks, energy production, and more. Most recently, Trump’s EPA has proposed to weaken Obama-era regulations on coal-fired power plans.

Based on research we argue that there could be more deregulation going on than most government watchers realize. President Trump — like many presidents of both parties before him — is certaintly using the White House’s Office of Information and Regulatory Affairs to modify regulations before they are issued.

Importantly, Democrats, despite taking over one chamber of the U.S. Congress, have little ability stop these deregulatory efforts. While Congress has the power to undo select regulatory changes under the Congressional Review Act, support from both house of Congress is necessary to do so. With Republicans extending their majority in the Senate, this seems rather unlikely. For now, Democrats will have to resign themselves to exerting their oversight powers to monitor federal agencies in the regulatory process, and, to a limited degree, pursue oversight through the courts if the Trump Administration oversteps its statutory bounds.

 

This post is based on the following articles:

Haeder, Simon F. and Susan Yackee. 2018. “Presidentially Directed Policy Change: The Office of Information and Regulatory Affairs as Partisan or Moderator?”  Journal of Public Administration Research and Theory.

Haeder, Simon F. and Susan Webb Yackee. 2015. “Influence and the Administrative Process: Lobbying the U.S. President’s Office of Management and Budget.” American Political Science Review 109(3): 507–522

Simon F. Haeder (@simonfhaeder) is an assistant professor in the department of political science in the John D. Rockefeller IV School of Policy & Politics at West Virginia University. Simon is also a Fellow in the Interdisciplinary Research Leaders Program, a national leadership development program supported by the Robert Wood Johnson Foundation to equip teams of researchers and community partners in applying research to solve real community problems.

Susan Webb Yackee is a Vilas Distinguished Achievement Professor of Political Science and the Director of the La Follette School of Public Affairs at University of Wisconsin-Madison