Opinion: Daily Journal

Trump sounds the right tone on regulation

CJ file photo
CJ file photo

In this age of cronyism and meet-the-new-boss-same-as-the-old-boss partisan turnstile D.C. politics, maybe it really does take an “outsider” executive to give up power voluntarily.

To D.C. insiders and their likeminded media, the idea is unthinkable. They lack even the vocabulary to denounce it properly.

Two days after Donald Trump won the election, Politico published an article entitled “Trump poised to erase Obama policies.” Here is what they saw Trump poised to do:

Donald Trump has pledged to “reform the entire regulatory code,” to “cancel immediately all illegal and overreaching executive orders,” and to place a “temporary moratorium on new agency regulations that are not compelled by Congress or public safety.”

What Politico described there is a chief executive pledging to shed his office of ill-gotten power. To start getting out of the way of people. To start taking its hands off industry. And then to resist the temptation to get back in the way and meddle.

Here’s how Politico introduced that paragraph: “Prepare for an imperial presidency.”

Imperial? Do they even know what that means?

Media winked and grinned at the imperial presidency of Barack Obama. This is president so allergic to working with Congress that he boasted of governing by pen and phone. His diktats were in line with their politics, so they didn’t fret the executive branch assuming powers it didn’t have.

The courts at least grew weary of Obama’s executive excesses, issuing hitherto unprecedented judicial checks against hitherto unprecedented executive actions. Discussing one such ruling, The Wall Street Journal marveled: “A federal court is stating, overtly, that federal regulators are behaving as if they are a law unto themselves.”

Even so, media and progressive cheerleaders to this out-of-control executive were warned that power seized in such a constitutionally questionable fashion could be dropped just as quickly.

Perhaps now it will. With the news from the incoming Trump administration regarding the regulatory behemoth, I have reason to hope.

An end to the ineffective but crippling Clean Power Plan?

Carolina Journal reports:

President-elect Donald Trump is likely to reshape the U.S. Environmental Protection Agency, and alter some of its most burdensome regulations, which will benefit North Carolina farmers, businesses, and utility ratepayers, state Department of Environmental Quality Secretary Donald van der Vaart says.

Two of President Obama’s signature regulations, the Clean Power Plan, and Waters of the United States, whose harshest critics include U.S. Rep. David Rouzer, R-7th District, would be a focus of the new administration, van der Vaart says. …

The Clean Power Plan and WOTUS “are the top of the list for whoever is going to take over the EPA,” van der Vaart said. “It is my belief that neither of those rules are going to go anywhere now that President Trump has been elected.”

Obama’s capstone environmental measure, the Clean Power Plan (CPP) would be the most foolhardy, expensive exercise in forced climate virtue-signaling ever. By 2100, the plan would achieve only a 0.018-degree (Celsius) reduction in temperature.

Less than two-hundredths of one degree Celsius. Even if you’re sweating that amount (as if anyone could perceive it), is it worth this? The CPP would:

  • impose at least $366 billion in costs
  • hit residents in 43 states with double-digit percentage increases in their electricity bills
  • cost consumers and businesses $41 billion to $73 billion or more for electricity per year
  • prematurely shutter 45,000 megawatts of coal-fired power generation capacity — more than New England’s entire electric generating capacity — and as much as 169,000 megawatts if the EPA cannot legally allow all options it specified for compliance.
  • shut down 68,000 megawatts of fossil fuel electric generating capacity
  • lead to widespread rotating blackouts in parts of the country

No thanks to Attorney General Roy Cooper, who pointedly refused to protect the state from those costs, North Carolina was one of 29 states that successfully petitioned the Supreme Court for an emergency stay of the CPP pending appeal. Van der Vaart’s DEQ — thanks to the work of Sam M. Hayes, Craig Bromby, and Andrew Norton — represented the interests of North Carolinians.

As of this writing, Cooper appears headed to win the gubernatorial election. As governor, Cooper would likely direct DEQ to implement the CPP. Fortunately for North Carolina, the new president eliminating the CPP would preempt that.

A plan for red tape reduction?

Trump also announced, as part of his policy plans for his first 100 days, the following:

On regulation, I will formulate a rule which says that for every one new regulation, two old regulations must be eliminated, it’s so important.

Readers of Carolina Journal and the John Locke Foundation’s work on regulatory reform are already familiar with this idea. Trading in old regulations for a new one is an idea we have been pushing for several years.

For example, our Agenda 2016 section on regulatory reform states:

Regulatory reciprocity would reduce the total regulatory burden over time by making agencies “trade in” a number of old rules for each new rule. It would also introduce opportunity cost to agency rulemaking, as agencies would have to consider their own trade-offs to creating a new rule.

Why is red tape reduction so important? Because regulations are costly. In just a single year, federal regulations cost American consumers and businesses an estimated $1.88 trillion from lost economic productivity and higher prices. In 2015, state regulations cost North Carolina’s economy as much as $25.5 billion.

But it isn’t only the single-year cost. Regulations accumulate over time. As they do, their hidden costs grow worse and worse. They’re like barnacles attaching themselves to the underside of the economy, slowing it down and creating waste.

Economists at Duke University estimated the effects of new federal regulations added since 1980. They found the U.S. economy could be 25 percent larger than it actually is — a loss of about $13,000 per person.

Economists at Appalachian State and N.C. State started their estimates from 1949. They found the U.S. economy to be only about one-fourth the size it could be — a loss of about $129,300 per person.

These massive costs also present a wide-open area for reform. If Trump follows through on this pledge for red tape reduction, it would yield positive economic benefits.

Doing that while also stopping a debilitating package of rules (the CPP) before it begins would, on the regulatory side, be a very liberating start to the Trump presidency. I hope he follows through.

Jon Sanders (@jonpsanders) is director of regulatory studies at the John Locke Foundation.