Politico

Trump's regulatory clampdown called more flash than substance

Written by Lisa

President Donald Trump’s crackdown on federal regulations could take months, if not years, to implement and likely faces costly court challenges.

The executive order, which Trump signed on Monday, requires that federal agencies and departments identify at least two existing federal rules that can be eliminated every time they issues a new regulation. It also seeks to dramatically limit the cost of rules, declaring that the total price tag of new final regulations combined with repealed regulations “shall be no greater than zero” in fiscal year 2017.

Trump aides cast the order as the most significant regulatory reform effort in decades, arguing that the president is making good on his promise to ease the burden of government on businesses.

But putting the order into practice isn’t as simple as Trump’s flashy “one in, two out” slogan suggests.

“It’s just a very indirect and gimmicky way of deregulating,” said Eric Posner, a law professor at the University of Chicago.

It could take years for the administration to fully eliminate regulations that are already on the books. And in some cases, agencies are mandated by law to write regulations, which could make it impossible in some cases to completely abandon them.

The order would also put a heavy burden on agencies with limited resources and shrinking budgets. It relies on these agencies to come up with a proposal to satisfy the order’s requirements — potentially setting off a complicated game of musical chairs in which federal workers are scrambling to find ineffective rules that neatly offset the cost of a new regulation.

“The rulemaking process is not a bazaar where rules are traded without regard to content,” said Rena Steinzor, a law professor at the University of Maryland who has tracked regulations for decades. Before modifying or killing a regulation, agencies must publish their reasoning for public comment, she noted.

And when outside groups inevitably challenge the administration’s decision to scrap key regulations, it will fall on the agencies to defend the decision in the courts with a policy-specific rationale for killing them.

“A court will demand reasons for a repeal and the reasons would have to be something connected to the underlying purpose of the statute,” Posner said. “I’m reasonably confident that a court would not accept Trump’s executive order as a basis of withdrawing the regulations. There has to be a substantive reason.”

Progressive groups strongly criticized the order, arguing that it opens the door to steamrolling environmental and public health protections, among other things.

“Are they saying that if you were going to address climate change that you have to stop protecting clean water?” asked David Goldston, director of government affairs at the Natural Resources Defense Council. “Where’s the logic?”

Robert Verchick, president of the Center for Progressive Reform, called the order “short-sighted” and said it doesn’t taken into account the benefits of regulations that limit exposure to toxic chemicals or protect drinking water, for instance.

The order appears likely to halt some regulations that industry wants, including rules that would mandate the disclosure of GMOs in food products. Congress asked the agriculture department to come up with the regulations after industry groups lobbied aggressively for federal preemption to avoid a patchwork of state GMO labeling laws.

“I think the executive order at least in the near term is likely to have its intended effect of slowing down, if not stopping, the adoption of new regulations,” said Stuart Pape, an attorney at Polsinelli and former lawyer at the FDA.

The order instructs the director of the White House Office of Management and Budget to issue guidance to agencies to help them comply with the requirements. But Trump’s nominee to head the OMB, Rep. Mick Mulvaney (R-S.C.), has not yet been confirmed by the Senate. Trump has not yet nominated anybody to head the White House Office of Information and Regulatory Affairs, which would likely play a central role in implementing the order.

“The workability of the initiative will hinge on the guidance to the agencies from OMB,” said John Graham, the who headed OIRA during the George W. Bush administration, explaining that the guidance should provide greater clarity.

Trump aides said Monday that any regulatory withdrawal will comply with existing federal review processes, which include public notice and comment periods. They said the administration is still working out the exact process, but the White House will have final say on which orders are implemented and eliminated.

After fiscal year 2017, when the total net cost of new and repealed regulations should be zero, the OMB director will prescribe “a total amount of incremental costs that will be allowed for each agency” for the upcoming fiscal year, according to the order.

“No regulations exceeding the agency’s total incremental cost allowance will be permitted in that fiscal year, unless required by law or approved in writing by the director,” the order says.

The order does not apply to regulations related to the “military, national security or foreign affairs function of the United States.”

Presidents already have a great deal of discretion to nix burdensome regulations. President Ronald Reagan signed an executive order in 1981 mandating that benefits of a regulation must outweigh the costs, putting in motion a complicated evaluating process used for federal rules that still exists today.

“[T]he right approach is not ‘one in, two out’ but a careful check on issuing new rules, with the help of cost-benefit analysis — accompanied by an ambitious program to scrutinize rules on the books to see if they should be scrapped,” Cass Sunstein, President Barack Obama’s former OIRA chief, said in November after Trump first proposed the policy.

“The Trump administration doesn’t need a gimmick to make progress on both fronts,” he added in a Bloomberg View column.

Sunstein said the policy is “likely to be a bit of a mess,” but Trump “might be able to make it work” if he gives his administration flexibility to implement it.

Helena Bottemiller-Evich contributed to this report.

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