Trump deregulation rule Biden ditched on Day One helped save $160 billion, analysis finds

The Trump administration’s deregulatory push that President Biden ended on his first day in office helped businesses save about $160 billion, according to an analysis issued as Mr. Biden paves the way for more-aggressive regulations.

Mr. Biden is trying to make a clean break from the former president. He has paused Trump-era deregulatory moves on issues such as drug prices and showerhead water flow and is signaling a far-reaching agenda in other areas.

“Biden has jettisoned … most of what Trump put in place,” said Clyde Wayne Crews, vice president for policy and a senior fellow at the free-market Competitive Enterprise Institute think tank. “It’s very difficult to imagine there being another administration that would be quite so aggressive in doing the things [President Trump] did, so I do give a lot of credit to the [Trump] administration.”

Mr. Trump’s moves on the “regulatory budget” resulted in $155 billion to $165 billion of net savings from 2017 to 2021, according to a report from the American Action Forum, a center-right think tank.

“The regulatory budget was very meaningful,” said Dan Bosch, the group’s director of regulatory policy and author of the report. “The range is in terms of economic impact, which is almost entirely borne by the private sector.”

Mr. Trump issued an executive order requiring a “one in, two out” rule for new regulations and imposing financial caps on how much new regulations could cost.

Mr. Biden rescinded the executive order on his first day in office. He said his administration needs flexibility to use regulations to tackle major issues including COVID-19, the economy, racial justice and climate change.

The American Action Forum’s report also estimated that the Trump administration added an average of $10 billion annually in regulatory costs, compared with an annual average of $111 billion during President Obama’s eight years in office.

Mr. Trump’s Office of Management and Budget pegged the savings on regulatory costs at closer to $200 billion from 2017 to 2020, including $144 billion in 2020 alone.

The previous administration said instead of a 2-1 ratio, it eliminated 5½ regulations for every one added.

Mr. Bosch said Mr. Trump’s implementation of the directive was ultimately a mixed bag and that the administration looked the other way when it came to more costly rules in areas such as immigration.

“One in, two out — it’s a simple sound bite to explain the general approach, but in how it actually worked it was very complicated and ultimately not that effective and meaningful,” he said. “It wasn’t counting apples to apples, and it didn’t require that regulations be specifically accompanied by repeal[s].”

Still, he said, it’s difficult to find another administration in the modern era that tackled regulations the way the Trump administration did.

“I wager in saying that going back in the modern era of presidents, even back through Reagan, this is probably the most deregulatory administration we’ve seen in terms of being able to quantify the economic savings that it produced,” Mr. Bosch said.

The actual savings, whether it’s $160 billion or $200 billion, are relatively small in the context of a $21 trillion-plus national economy and a $4 trillion-plus federal budget.

But the private sector cheered Mr. Trump’s moves on deregulation. He said businesses welcomed any way to reduce the federal red tape that companies must navigate.

As is typical with new administrations, Mr. Biden announced a temporary freeze and review of regulations that Mr. Trump’s team had finalized. He also directed federal agencies to review existing orders and regulations that might be in conflict with his stated goals of combating climate change.

To that end, the Department of Energy is reviewing Trump-era rules that could allow for heavier water flow from showerheads and in washing machines and dishwashers.

Low-flow showers, toilets and dishwashers became a persistent focus of Mr. Trump during his time in office.

“Remember the dishwasher? You’d press it, boom! There’d be like an explosion. Five minutes later you open it up, the steam pours out,” Mr. Trump said in December 2019. “Now you press it 12 times. Women tell me … you know, they give you four drops of water.”

Mr. Biden’s regulatory freeze also delayed the implementation of a rule to make community health centers pass along savings from discounted drug prices to lower-income patients.

The National Association of Community Health Centers opposed the original Trump administration rule. It said the rule was redundant and imposed standards that the health centers were already mandated to meet.

In signing the order ending “one in, two out” and Mr. Trump’s “regulatory budget,” Mr. Biden said it’s the policy of his administration to use “available tools” to tackle urgent challenges facing the country.

“To tackle these challenges effectively, executive departments and agencies must be equipped with the flexibility to use robust regulatory action to address national priorities,” the president said. “This order revokes harmful policies and directives that threaten to frustrate the federal government’s ability to confront these problems, and empowers agencies to use appropriate regulatory tools to achieve these goals.”

Advocacy groups say they are all-in for a more expansive use of the federal government’s regulatory power.

Environmental groups have praised Mr. Biden for his executive actions, including moves to stop new energy leases on federal land and step up federal procurement of electric vehicles.

“Biden’s all-out climate mobilization is off to a great start with these executive orders. Now every federal agency and Congress must do their part, too,” said Jamal Raad, executive director of the group Evergreen Action.

Mr. Crews of the Competitive Enterprise Institute said that attitude is shortsighted.

“I don’t think progressives think regulations have any cost,” he said. “They always claim a net benefit, which means there’s no stopping point, there’s no governor or brake.”

Mr. Bosch said Mr. Biden sent a clear signal about his plans by outlining a desire to achieve policy goals through regulation and prioritizing benefits that are difficult to quantify.

“So things like effects on climate change and dealing with racial disparities and inequality — those kinds of things,” he said. “To me, that was a very big signal that they intend to use regulation as their chief means of implementing their agenda.”

Adam White, a resident scholar at the American Enterprise Institute, said the executive moves could crowd out Congress’ willingness to act on major issues, even with unified Democratic control of Washington.

“The first 100 days really used to be a legislative agenda,” Mr. White said. “Now it’s mostly a presidential administrative agenda.”

He said a president’s willingness to take action can become an impetus for Congress to sit back and defer rather than take politically risky votes.

“The president’s administrative agenda is largely crowding out any kind of legislative agenda, other than the COVID relief bill,” he said. “If you have an ambitious EPA agenda on climate policy, for example, which Democrat wants to compromise and expose him or herself to a primary challenger in just two years?”