Trump’s First 100 Days Herald Tough Regulatory Battles Ahead

Federal regulation costs trillions of dollars each year. Call it the “costberg”—a vast, submerged amalgam of rules, guidance, and paperwork that reshapes the economy without a vote in Congress.

These regulatory costs stack atop the $7 trillion Washington is set to spend this year. Surveys like the just-released Ten Thousand Commandments help track notice-and-comment rules and the limited information available about their costs (conservatively estimated at over $2 trillion annually).

But the bigger problem now is the big bang of agency memos, bulletins, circulars, and other forms of regulatory dark matter—edicts that bypass traditional public-notice rulemaking procedures, allegedly lack the force of law, yet few are brave enough to ignore.

Add to that the laundering of regulation through subsidies, grants, contracting, and procurement, and it becomes clear we are increasingly governed not just by Congress but by what Barack Obama called the executive branch’s “pen and phone.”

Donald Trump’s first term imposed some discipline on traditional rulemaking through a one-in, two-out requirement, and made real progress against regulatory dark matter, including establishing a formal inventory.

But COVID-19 disrupted those reforms, fusing massive new spending with expansive regulatory power. Emergency management morphed into permanent governance, with federal powers stretched to justify price controls and intervention in supply chains. Crisis now seemingly licenses anything; if you doubt it, just wait for the next economic shock. This tendency toward flash policymaking in response to crisis cuts across party lines—and it’s a deeper threat to limited government than any one administration’s bungling.

Biden’s “whole-of-government” initiatives on climate, equity, the care economy and more accelerated these shifts toward expanded federal power. His Modernizing Regulatory Review executive order scrapped Trump’s entire regulatory streamlining project. What little cost-benefit analysis existed was gutted and replaced with agency pursuit of “net benefits” as defined by progressives, whose North Star is regulatory wealth redistribution and government-driven safety nets for able-bodied adults. The cost threshold for reviewing significant rules was doubled, allowing even more regulation to slip through unremarked upon.

The current Trump administration has issued over 140 executive orders, many aimed at taking regulatory streamlining to greater heights, while naturally returning his predecessor’s favor by rolling back not just Biden’s rules, but his entire progressive philosophical framework.

Over time, however, these steps won’t restore limited government unless Congress backs them up legislatively—and limited government is doomed regardlessif Congress keeps passing hyper-regulatory laws like the CARES Act, the Bipartisan Infrastructure Law and the CHIPS and Science Act. To an underappreciated degree, spending-driven regulatory expansion is bipartisan. And if we’re being honest, the left isn’t particularly worried, because they know the GOP ultimately yields to the largest legislative interventions when push comes to shove. This year’s deficit will top $2 trillion—with no war or national emergency at hand.

Still, there’s reason for long-term optimism when it comes to lightly regulated free enterprise, robust capitalism and rising prosperity. Most of the world’s wealth has yet to be created, and America’s bloated administrative state increasingly cannot hide its character as a barrier, not a builder. Agencies cannot meaningfully measure costs and benefits when their very existence is the cost.

Reform energy is growing, too, here at the conclusion of Trump’s first 100 days. Ideas like regulatory budgeting, requiring congressional approval of major rules, and exposing regulatory dark matter are gaining ground. Most importantly, even agency termination is now on the table. Trump’s Executive Order 14,219 boldly calls for “Commencing the Deconstruction” of the administrative state. If policymakers get serious, here are some action items to ensure that outcome:

• Terminate departments and agencies (and most spending, for that matter)
• End federal subsidies and public-private partnerships
• Downscale federal contracting and procurement
• Require congressional approval of regulations
• Brace for post-Chevron progressive mobilization
• Enforce existing regulatory reform laws
• Rewrite OMB’s regulatory cost-analysis guidelines
• Reinforce Trump executive orders with new legislation
• Crack down on regulatory dark matter
• Implement regulatory cost budgeting
• Establish sunsetting and a regulatory reduction commission
• Create an annual regulatory report card
• Consider replacing or subordinating OMB review with a Congressional Office of Regulatory Analysis (CORA)
• Enact an “Abuse-of-Crisis Prevention Act” before the next economic shock

Even if many of these reforms are achieved, one crisis could erase all progress. That’s why the final action item—the Abuse-of-Crisis Prevention Act—is crucial. Policymakers have shown time and again that they will seize on any disruption to expand government. An AOC Prevention Act would shrink the federal enterprise in favor of resilience at the state, local, and household levels, and impose restraints on predatory emergency declarations that permanently expand federal spending and regulation.

Liberty’s unfinished business is at hand, and the next 100 days can advance it further—before another crisis demands action.