Regulatory Policy

Biden’s Regulatory Pen and Phone Must Be Replaced with an ‘Abuse-of-Crisis Prevention Act’

President Joe Biden signs executive orders at the White House, January 28, 2021. (Kevin Lamarque/Reuters)
Public policy should aim toward increasing resilience and renewal, rather than dependence on the administrative state.

For folks who talk about boring topics such as federal regulation, it’s normal to discuss costs and counts.

I’m one of those people. I actually enjoy writing the Ten Thousand Commandments — the Competitive Enterprise Institute’s annual survey of the federal regulatory state. Indeed, each year it informs readers of important details, such as how the regulatory burden in the U.S. rivals the cost of the individual and corporate income tax combined. (Glamorous, I know.)

Yet this report covers just the part of federal regulation we can discern. Just as the great economist Ludwig von Mises noted that economic calculation in a socialist polity is impossible, it’s impossible for third parties to know the full costs of regulatory intervention experienced across all of society.

Regulation’s intractable nature ensures that the administrative state continues to grow. And Congress bears much of the blame. Each year, Congress passes a few dozen laws, while the federal bureaucracy churns out well over 3,000 regulations. Given that Article I vests all legislative power in Congress rather than the alphabet agencies, I like to call this ratio the “Unconstitutionality Index.” In the past decade, it has reached an average of 28 agency rules for each piece of legislation passed into law.

But unfortunately, there’s a lot more to federal regulation than that. Rule by guidance document became routine when President Obama asserted that he governed with a “pen and phone,” Congress be damned. These were exemplified in Obama’s unilateral immigration-law changes; manipulation of his own Obamacare statute (via waivers extending the employer-mandate deadline and allowing continuance of noncompliant policies); the Department of Justice and Department of Education pronouncements over bathroom access, and more.

While there was a partial reprieve after eight years of Obama with Trump’s four, public safeguards are now shattered. Indeed, nobody needs to actually write rules anymore — a topic that I’ll return to in a moment. First, it’s helpful to understand the nature of the regulatory environment under President Trump. While the Ten Thousand Commandments typically addresses the regulatory burden by calendar year, rather than presidential terms, the sheer unconventionality of the Trump years necessitated a recap of his administration’s successes and misfires. Consider seven of the key ways Trump streamlined things. The administration

  • eliminated 15 rules and one guidance document via the rare use of the Congressional Review Act;
  • continued agency restraint in initiating large, significant rulemakings after the delay or withdrawal of hundreds of Obama administration rules in the pipeline;
  • streamlined permitting for pipelines, bridges, 5G broadband, rural broadband, and other infrastructure;
  • made progress, albeit with declining marginal returns once the low-hanging fruit was picked, on the presidential requirement that agencies eliminate at least two rules for every one issued;
  • took steps toward addressing the aforementioned agency guidance documents and other sub-regulatory decrees; and
  • streamlined specific regulations to address the COVID crisis, such as those related to health care and transportation.

(Also, in a few instances, agencies quite apart from executive directive took proactive steps on their own in the spirit of what might be called “rules for rulemaking” by offering formal reform recommendations. Take, for example, the Department of Transportation under Elaine Chao, and the Department of Justice, whose deputy attorney general issued a report titled Modernizing the Administrative Procedure Act.)

Unfortunately, Trump’s deregulatory agenda was not applied to every issue. His affinity for aggressive antitrust intervention, drug price controls, regulation of social-media content, and tariffs and trade restrictions (just to name a few) counteracted and complicated his regulatory-reform legacy.

Trump’s lapses and Republicans’ acquiescence in it have left the nation vulnerable to pro-regulatory agendas, such as Biden’s elimination of Trump’s deregulatory executive orders. On Day One, for example, President Biden eliminated Trump agency directives to grapple with what I like to call “regulatory dark matter” — the informal guidance that agencies issue without going through the Administrative Procedure Act’s notice-and-comment process. He’s gone further yet, even removing the official “Deregulatory” designation for reporting of rules — a transparency-enhancing measure introduced during Trump’s tenure. Biden’s agencies are now in the process of getting rid of Trump-era procedures for protecting the public from guidance document abuse to boot.

Expect more unilateral action, such as from the Federal Trade Commission, which has indicated moves to ditch bipartisan Obama-era restraints on antitrust enforcement. In this and other areas, the responsibility for administrative-state bloat is shared by Republicans, who never truly occupy the driver’s seat no matter who the president or his appointees are.

The situation is grave in the post-COVID era in which dangerous hyper-spending continues as if the country were still in crisis mode. Taxing and spending have always had regulatory effects. For example, each signature Biden program — the American Rescue, Jobs, and Families plans — threatens to impose social regulation of healthy adults. If allowed to come to fruition, their countless provisions would likely be heavily administered with guidance documents, not solely actual laws or even ordinary regulations. The same is true, sadly, of the bipartisan and regulation-heavy infrastructure compromise bill (which Republicans should abandon). But, as with antitrust, they just can’t help themselves, even when they have alternatives.

Grappling with abuse of agency guidance documents — not just their thousands of rules — is key. But even that is merely treating a symptom. In terms of constitutionality and preservation of limited government, it is vital to impose upon Congress an Abuse-of-Crisis Prevention Act that prioritizes deregulatory stimulus, fences in federal spending, allows greater retention of household and business wealth, and limits the emergency-power abuses that happen every single time there’s a crisis. Public policy should aim toward increasing resilience and renewal to allow for the growth of intergenerational wealth and self-sufficiency in preparation for crisis, rather than dependence on the administrative state.

We will continue to document the fusion of spending and regulation in reports such as Ten Thousand Commandments. But if Congress doesn’t act to restore spending and regulatory restraint, our progeny will be left unable to deal with future crises because we will have stolen their resources and regulated them into helplessness.

Wayne Crews is vice president for policy and a senior fellow at the Competitive Enterprise Institute.


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