Quantitative over qualitative regulatory reform: assessing Trump Regulatory Reform Agenda’s implementation. An update

Research note by Leonardo Parona

The release of the latest version (fall 2019) of the Unified Agenda of Federal Regulatory and Deregulatory Actions – which, since the ‘80s, offers an updated representation of the ongoing progresses towards more effective and less burdensome regulation – represents a valuable opportunity for assessing the current implementation of Trump’s Regulatory Reform Agenda three years after its inception in 2017 (E.O. 13771, 30 January 2017, Reducing Regulation and Controlling Regulatory Costs (82 FR 9339), and E.O. 13777, 24 February 2017, Enforcing the Regulatory Reform Agenda (82 FR 12285)).

Before presenting some concise considerations, however, it might be useful to briefly recall the main features of the Regulatory Reform Agenda. The basic goal of such deregulatory initiative, which focuses almost exclusively on the costs generated by regulation, is the reduction of the burden of federal regulation on American businesses and economic activities in general. The agenda, more precisely, is built upon two main policies, i.e. the zero-net-cost policy (which deals with the total amount of regulatory costs introduced every year) and the one-in-two-out policy (which deals with the number of regulations introduced and deleted), the implementation of which is ensured by the Presidential Office of Management and Budget (OMB). The Regulatory Reform Agenda, moreover, envisages a more active role of the OMB and confers new powers to its Director, who is now in charge, among other things, of approving the regulatory budget and fixing for each agency a total incremental cost allowance. Finally, federal agencies as well (except for independent regulatory commissions), have experienced some changes in their organizational structure, following the creation of Regulatory Reform Task Forces which, besides ensuring the compliance with the policies of the new Agenda, are asked to carry out regulatory planning, regulatory review and retrospective review activities, previously dealt with directly by agency heads.

The deregulatory initiative inaugurated with the two mentioned executive orders has subsequently been accompanied by an aggressive use of several low-profile and less formalized rollback tools, to target some of the prior administration’s regulations, such as: disapprovals under the Congressional Review Act, abeyances in pending litigation concerning previous regulations and suspensions of final regulations.

The recent Unified Agenda of Federal Regulatory and Deregulatory Actions (Fall 2019) could represent – as mentioned at the outset – a useful tool for assessing the implementation of the Regulatory Reform Agenda, as well as for revealing regulatory priorities. Information provided by such report, however, should be used with caution.

For example, although the overall number of rules registered in the Agenda is currently higher than under President Obama (the Fall 2019 rule flows is 3.752, against 3.320 rules under President Obama in 2016), this is due to the fact that deregulatory rules also count as rules. Making a comprehensive assessment of the implementation of the Regulatory Reform Agenda is therefore more complicated than it might seem. What emerges, however, is that although in 2019 the one-in-two-out requirement has been formally met (689 deregulatory actions against 324 regulatory actions), there are about 2.000 regulatory actions that have been excluded from the balance.

Another element to be kept into consideration is represented by long-term planned regulatory actions, i.e. major rules that are undergoing a process of approval, which currently outnumber deregulatory ones.

These factors, although providing only a partial representation, suggest that, while in the first years (see 2017 and 2018 editions of the Unified Agenda of Federal Regulatory and Deregulatory Actions) of the Regulatory Reform Agenda’s implementation, agencies managed to meet its goals, in the long run such deregulatory initiative is proving itself either ineffective or structurally unsustainable.

A possible explanation for this recent trend could be represented by the attempt of some agencies to oppose their “resistance” against Trump’s Regulatory Reform Agenda. Such an explanation, although having the merit of taking into consideration the political dimension of the regulatory process, is however debatable and, in order to be confirmed, would require a more accurate case by case analysis. 

These brief considerations, and the data provided by the Unified Agenda of Federal Regulatory and Deregulatory Actions, do not allow us to univocally express a negative evaluation on the Regulatory Reform Agenda and its implementation. What seems to be confirmed, however, is the prevalence of the quantitative – instead of qualitative – approach of such reform, which focuses more on the costs and the number of federal rules, rather than on the effective benefits they could provide.

For a more detailed analysis of the Author see L. Parona, Riforme recenti e prospettive future del rulemaking statunitense, in Rivista trimestrale di diritto pubblico, 2018, n. 4, pp. 1145-1167

Some updated readings on this topic are: