Getting rid of unneeded regulations may be the single-most effective spur to economic growth that’s available to the federal government. Thankfully, unlike most recent presidents, President Trump is taking the job of cutting bad regulations seriously.
That can be evidenced by the special “Deregulation Day” that Trump declared for his “cut the red tape” event on Monday. Hey, if you didn’t know it was Deregulation Day, you’re not alone.
Still, the president seems to be pushing a minor revolution of sorts, as he repeals all sorts of rules that once impeded the economy. And he’s not done yet. The Competitive Enterprise Institute claimed, “Trump ends the fiscal year as America’s least-regulatory president since Reagan.”
It’s no exaggeration. As the CEI has noted, Trump froze regulations early in his term and argued that up to 70% of regulations were simply unnecessary. He set a tone, and he’s lived up to it. Consider this: The Federal Register, the bible of federal rules, peaked at record high 97,110 pages under President Obama in 2016. Today, under President Trump, it stands at 45,678 pages.
If you count the nine months of regulations propagated by Trump vs. President Obama in 2016, it comes out to 2,183 rules put forward by Trump, compared with 2,686 rules for Obama, an 18% decrease. But even those numbers are deceptive since many of Trump’s new regulations are in fact getting rid of or freezing old regulations. And in terms of the size, Trump’s “significant rules” — those having $100 million or more in estimated economic impact — are just 116 in his first nine months, down 58% from Obama’s 274.
He’s also got fewer rules in the pipelines than any recent president and has promised to cut two for each new rule proposed. The number of significant new rules for Trump totaled 65, way below the average of 213 significant rules in the pipeline in the previous six presidential terms, including Presidents Clinton, Bush, and Obama.
Diane Katz, a fellow with the Heritage Foundation, notes that under Obama, the costs of regulation soared from $68 billion a year in direct costs under President George W. Bush, to $122 billion under Obama.
All told, CEI’s top regulatory analyst Wayne Crews estimated that the economic cost of regulation to the economy is $2 trillion, or roughly 12% of current real U.S. GDP. That’s $15,000 a year for every American family.
That’s an immense amount of money, considering that much of it is utterly wasted. In the private sector, no one ever thinks of doing where costs exceed the benefits. Only in government do people consider imposing rules that cost far more than they’re worth. It’s an enormous tax — one most Americans don’t even realize they’re paying.
“The unparalleled expansion of the administrative state is crunching America’s entrepreneurial spirit, productivity, and economic growth,” Heritage’s Katz wrote on Monday.
She’s right, of course. Small businesses, in particular, seem to be enjoying a renaissance under Trump as the zombielike hand of the regulatory state has finally started to release its grip. That’s why we hope that Trump, with the help of Congress, will stay the course and slay the regulatory demon.
Read more at IBD