This post is the first in a three-part series.
During his first term, President Donald Trump encountered for the first time the modern regulatory system that Congress has slowly built up over the last century. What he found was that its commitment to rule of law principles, democratic input, and reason-based decision-making presented a formidable barrier to his administration’s agenda of rolling back protective measures that millions of us depend on to keep our workplaces safe, our drinking water free of contaminants, and our bank accounts guarded against cheats and scams.
That experience clearly left an impression. With the help of Office of Management and Budget Director Russ Vought and other White House advisors, Trump has spent the first few months of his second term issuing a dizzying array of executive orders aimed at building, piece by piece, the kind of regulatory system that he would like to have — one that is strongly biased against promoting the public interest.
Given the sheer magnitude of these orders, it’s easy to lose sight of just how systematic this overall effort has been. And maybe that’s the point. But if you line them up, you’ll find the orders accomplish a comprehensive scheme to corrupt each of the four key pillars undergirding regulatory decision-making: law, science, economics, and career civil service.
Law
The law is the genesis of all agency regulation. Agencies cannot take a particular regulatory action without legal authority. Sometimes this authority mandates a specific action by a date certain; other times, it conveys substantial discretion in whether and how to act. With respect to executive branch agencies, presidents can, and ought to be able to, shape how agencies exercise that discretion when it exists. But that does not mean that presidents can systematically prevent agencies from accounting for decision-making factors Congress told them to consider through their authorizing statutes or force them to account for factors Congress expressly forbid them from considering.
Unsurprisingly, Trump has issued several executive orders that defy these legal limits in order to skew agency decision-making in an antiregulatory direction. The so-called 10-out, 1-in executive order from January has this obvious effect in requiring agencies to account for a decision-making factor that Congress has not authorized when deciding whether to issue a new rule: whether there is space under the agency’s arbitrary “regulatory cap.” Similarly, it compels agencies to repeal existing rules (a form of regulatory action) that they would not have otherwise for reasons not permitted by the authorizing statute (i.e., to clear space under the regulatory cap).
In February, Trump followed up with a second executive order similarly designed to steer the administration’s deregulatory agenda in ways that contravene agencies’ legal authority. Whereas the 10-out, 1-in order creates an illegal incentive structure to discourage new rules, this second order on “Implementing the President’s ‘Department of Government Efficiency’ Deregulatory Initiative” sought to provide more refined guidance for developing a deregulatory agenda by prioritizing rules for repeal that it claims run afoul of a lengthy list of U.S. Supreme Court precedents. The goal, of course, is to provide agencies with an all-purpose pretext for rescinding rules that the administration objects to for purely ideological or political reasons.
Trump has taken more targeted actions at controlling how agencies account for their legal authorities when engaging in regulatory decision-making. An April executive order on “Zero-Based Regulatory Budgeting” is designed to quickly unwind various existing environmental regulations that allegedly inhibit American fossil fuel energy development and use. As a threshold matter, few laws permit or require agencies to explicitly account for these kinds of energy impacts as part of a decision-making criterion (though, many might permit this indirectly as part of more generalized cost considerations). Indeed, the purpose of many environmental statutes is to limit fossil fuel use in absolute terms, or at least to reduce the intensity of such use in many industrial activities.
More specifically, the order purports to require agencies to incorporate “sunset” provisions into all such existing and future regulations as a means for affirmatively promoting energy production. According to these provisions, a rule will automatically expire after five years unless the agency takes some affirmative action to extend its legal effect. Properly understood, such sunsets are an illegal end-run around the requirement that agencies undertake the standard rulemaking process to repeal their existing rules. Black letter administrative law demands such regulatory repeal actions comport with statutory authority, reflect a reasoned deliberation based on the evidence available to the agency, and abide by applicable procedural requirements, including notice and comment. An executive order cannot permit agencies to wish those requirements away.
Another April executive order requires agencies to work with the Federal Trade Commission and the U.S. Attorney General to identify existing rules that are “anti-competitive” in effect and to begin taking steps to repeal them. As was the case with the Zero-Based Regulatory Budgeting order described above, few laws explicitly permit or require agencies to base their decision-making on anti-competitive effects. To the extent that this order compels agencies to undertake deregulatory actions they otherwise would not have, it raises similar concerns about introducing improper legal considerations into agency decision-making.
Not content merely to dictate the legal substance of agencies’ deregulatory agendas, Trump has also taken upon himself to micromanage how agencies interpret their procedural obligations in carrying out these agendas. An April memo directed them to avail themselves of the Administrative Procedure Act’s “good cause” exception to the notice-and-comment requirement for the standard rulemaking process for certain kinds of deregulatory actions, thereby cutting the public out of the process so that they can be rammed through as quickly as possible.
Lastly, Trump’s February executive order on “Ensuring Accountability for All Agencies” provides a kind of all-purpose “backstop” provision for micromanaging agency regulatory decision-making that can be used to catch any instances that might slip through cracks between these different orders. In a particularly controversial section, the order asserts that “The President and the Attorney General, subject to the President’s supervision and control, shall provide authoritative interpretations of law for the executive branch.” While it remains to be seen whether and how this authority is asserted in practice, it opens a veritable Pandora’s Box for forcing agencies to account for criteria in regulatory decision-making that exceed their legal authority.
In two follow-up posts, I will look at the impact of Trump’s executive orders affecting the use of science, economics, and the career civil service to advance his administration’s deregulatory agenda.
