Analysis: Trump’s New “10-Out, 1-In” Executive Order — Part Two

This post is the second in a series. Click to read the first and third posts.

In my previous post, I began exploring some of my major takeaways from the new “10-out, 1-in” executive order. President Donald Trump sort of announced the order Friday night with a Fact Sheet, but not the actual order itself. At this point, the order is not on the White House website but can be viewed on a third-party website.

In this post, I will offer some additional observations and analysis. As noted previously, there’s a lot of uncertainty still about how the Trump administration will actually interpret and implement the order’s ambiguous terms. This analysis is intended to preliminary and contingent upon further clarification from the Trump administration. I’ll provide further updates as that guidance becomes available, so keep an eye on this space.

The 10-out, 1-in executive order further entrenches the power of the Director of the Office of Management and Budget (OMB). There’s no question that the Trump administration envisions the OMB Director playing a powerful role. This is especially terrifying because the individual likely to hold this position is none other than Russell Vought, a key architect of the Project 2025 policy vision that is now guiding the Trump administration and a leading advocate for the creation of an authoritarian administrative state.

According to my analysis of the 55 executive orders and other actions that Trump announced during his first week in office, 21 of them (38 percent) assign an implementation role to the OMB Director. The 10-out, 1-in order adds to this list. Repeatedly, it empowers the OMB Director to fill in the implementation details for the executive order. This would only further expand the OMB Director’s authority over the federal regulatory apparatus. Among other things, he would get to decide what agencies’ annual regulatory budgets are, what rules must satisfy the regulatory budgeting requirements, and, perhaps most importantly, what rules are exempt. It will be interesting to see whether presumptive Director Vought retains these powers or delegates them to the OIRA administrator, as was the case during Trump’s first term.

As with the similar regulatory budget executive order from Trump’s first term, this order gives the OMB Director “gatekeeping” authority over agencies’ entire regulatory agendas — not just specific rules. This, too, represents a massive expansion of the OMB Director’s power over the regulatory work of the administrative state.

Executive Order 12866 remains on the books — for now. The new order directs agencies to continue complying with various aspects of Executive Order 12866, which suggests that the Trump administration intends to retain that order. Ever since it was issued by President Bill Clinton, Executive Order 12866 has provided the basic legal infrastructure the centralized review process conducted at OIRA, as well as for the semiannual regulatory agenda development process.

While Republicans have long championed Executive Order 12866 as an institutional mechanism for blocking or weakening rules, the first Trump administration was notable for having an uneasy relationship with OIRA review. Many of its regulatory actions flew through the review process in just a few days, suggesting that it was conducted in a manner that was at best perfunctory. Several of the cost-benefit analyses performed in conjunction with this review process were sloppy and even amateurish. Ironically, the whole episode seemed to suggest that OIRA review presented a formidable barrier to the kind of reckless deregulation that was a hallmark of the first Trump administration.

So, it was an open question what Executive Order 12866’s status would be during a second Trump administration. For now, it seems like Trump intends to retain it. If so, we can expect more haphazard reviews and slapdash cost-benefit analyses. In the future, though, it is possible Trump may replace Executive Order 12866 with a new centralized regime that is more amenable to deregulation.

The Biden administration’s revisions to Circular A-4 are gone, and the 2003 version has been reinstated. As part of its broader Modernizing Regulatory Review initiative, the Biden administration significantly revised Circular A-4, a technical guidance documents for agencies that offers step-by-step instructions on how to conduct cost-benefit analyses for their rules as part of the Executive Order 12866 process. The Biden revisions were intended to improve agency estimates of regulatory benefits, which were historically underestimated, and to account for rules’ distributional consequences, which would give a more accurate picture of their on-the-ground effects.

By reverting to the 2003 version, the Trump administration is effectively locking in analytical methodologies that are systematically biased against protective regulations. These will make it harder for a future administration to justify such policies and could, to a point, make it easier for Trump administration agencies to defend their deregulatory actions.

While the Biden administration subjected its revisions to a public notice-and-comment process and peer review, the Trump administration summarily repealed them. It’s possible that this failure to follow a rigorous process could leave Trump administration regulations vulnerable to legal attack. The Regulatory Right-to-Know Act, which provides some legal authority for Circular A-4, could be read as requiring a notice-and-comment and peer review process for revisions to regulatory guidance like these. Also, to the extent that the 2003 version of Circular A-4 is no longer seen as the state of the art for conducting regulatory impact analysis, rules that rely on it could be challenged as “arbitrary and capricious” under the Administrative Procedure Act or as inconsistent with the “best available science,” as applicable, under their authorizing statute.

In a third and final post, I will offer one last set of observations on Trump’s new “10-out, 1-in” executive order. Stay tuned for that.