New Order: Cut Two Regulations for Each New One

You can read the order here. Key text:

Sec. 2. Regulatory Cap for Fiscal Year 2017. (a) Unless prohibited by law, whenever an executive department or agency (agency) publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed. (b) For fiscal year 2017, which is in progress, the heads of all agencies are directed that the total incremental cost of all new regulations, including repealed regulations, to be finalized this year shall be no greater than zero, unless otherwise required by law or consistent with advice provided in writing by the Director of the Office of Management and Budget (Director). (c) In furtherance of the requirement of subsection (a) of this section, any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least two prior regulations. Any agency eliminating existing costs associated with prior regulations under this subsection shall do so in accordance with the Administrative Procedure Act and other applicable law.

I wrote about this “one in, two out” idea here. As crazy as it sounds, this is actually an approach that both the UK and Canada have used to pare back the regulatory burden.

And the final order is surprisingly limited, thanks to section (b). An agency making $5 billion worth of new regulation doesn’t have to repeal $10 billion worth—it just has to offset the $5 billion while cutting twice the number of regulations. It could enact five $1 billion rules and repeal ten $500 million rules.

Section (c) seems to say that each new regulation has to be offset specifically by the two repealed regs it’s paired with—a “pay-as-you-go” system—but frankly the wording is kind of garbled.

Starting next year, agencies will be given a “regulatory budget” they have to stick to, instead of just keeping incremental costs at zero. This will be handled by the director of the Office of Management and Budget, a position for which Trump has chosen Mick Mulvaney.

Brian Knight of the Mercatus Center has some more thoughts here.

Robert VerBruggen is managing editor of The American Conservative.

Follow @RAVerBruggen