Hoping that the Trump administration’s going to ease HR’s regulatory burden over the next year or so? Afraid we’ve got some bad news.
Companies hoping for big regulatory rollbacks may be disappointed, according to four experts who spoke at a panel session, Assessing the Trump Administration’s Regulatory Agenda, at the University of Pennsylvania in Philadelphia on March 28, sponsored by the Penn Program on Regulation.
There’s a certain amount of “low-hanging fruit” that will be targeted at first, according to Alan Krupnick, co-director of the non-partisan Center for Energy and Climate Economics at Resources for the Future.
But Krupnick says the low-hanging fruit will run out. Attempts to eliminate some regulations may wind up in court. Various advocacy organizations’ war chests are “well stocked” to oppose rescinding federal rules, according to Krupnick. He predicts some attempts to remove regulations will be stopped by the courts.
Krupnick says there are two anti-regulatory directions that businesses can count on, at least in the first two years of the Trump administration:
There will be very few new regulations enacted, and Congress will attempt to further relax regulatory burdens through the federal budget. Lawmakers may not fund programs to enforce regulations.
Even a lack of Congressional funding isn’t a given, according to Krupnick. Despite a Republican majority, he says there may be pushback at some levels against too many agency funding cuts.
It takes time
Amy Sinden, an environmental and property law expert at Temple University, noted that the process to formally withdraw a regulation takes time.
In fact, the same process that’s used to enact a new or change an existing regulation has to be used to eliminate one.
That process, which include various required analyses and comment periods, can take several years.
Sinden says it may be three or four years before the removal process winds its way through the system for some regs. And that’s not necessarily counting court challenges, which could draw out the process even longer.
But even the Obama administration found some cumbersome business regulations to rescind, noted Sam Batkins, Director of Regulatory Policy at the center-right American Action Forum.
Even with that note of optimism for regulation removal, Batkins admitted that he isn’t sure if there are “20 or 30” such regulations that could be rescinded without much controversy or challenge. And that’s across all types of business regulations.
Cary Coglianese, director of the Penn Program on Regulation, noted that the Trump administration is taking eight steps to further its anti-regulatory direction:
- Nomination of agency heads who share his view about reducing regulations
- Budget proposals that would cut regulations and/or enforcement
- Targeting agencies for reorganization, including this week’s announcement of the Office of American Innovation which seeks to bring business management practices to government
- Using targeted executive orders as a jumping off point to rescind regulations
- Action directly from agency heads on their own since they share the President’s point of view
- Using the Congressional Review Act to rescind recently enacted regulations (such as the Fair Wages and Safe Workplaces executive order)
- General executive orders that change the regulatory process (example: the “one-in-two-out” EO), and
- Legislative changes to the regulatory process such as the REINS Act, which would require Congress to approve new regulations before they go into effect.
Coglianese says if bills such as REINS are passed in Congress, this would mark the most significant change in the regulatory nature of the federal government since the end of World War II.
When will we know more officially about the regulatory direction in Washington? Batkins says the spring version of the federal Regulatory Agenda, which is usually released in May, could be delayed because agencies aren’t fully staffed with political appointees yet.
Late or not, the upcoming Regulatory Agenda will most likely be slim due to the new administration’s position on regulations.
Batkins notes the Federal Register, which publishes updates on proposed regulations, is “a lonely place” right now.
Under the “two-for-one” EO, Batkins says 80 to 100 existing regulations would have to be eliminated annually to offset the cost of new regulation.
Congress realizes this is an uphill climb, according to Batkins. Some members of Congress are recommending adding 40 to 50 staff members to the Congressional Budget Office, which provides federal lawmakers with nonpartisan analyses of economic and budget decisions.
Sinden called the two-for-one EO “patently absurd.” She notes that many laws passed by Congress, such as clean air and water laws, require lawmakers to meet certain standards via regulations that are enacted by executive branch agencies.
Sinden says it appears President Trump thinks he can “rule by decree,” but that’s not entirely possible. Courts will likely stand in the way of that happening. Whether or not Congress goes along with the President’s desire to defund certain parts of the federal government could also play a part. And it’s not a given, just because the same party controls Congress and the White House, that will actually happen.
A general theme that arose from the session: There appears to be a lot going on right now regarding federal regulations, but in reality, not as much as it seems. Not much has happened that will have a fast impact on businesses.
If all this makes your head spin, you can take some comfort in knowing that even the experts feel that way. Sinden said due to the “whirlwind” of activity, she’s “exhausted.”
The final word came from Coglianese, who said only time will tell what really happens. “To be continued,” he said.