Unleashing Prosperity Through Deregulation

This order directs federal agencies proposing a regulation in 2025 to identify ten existing regulations for elimination that together yield a net reduction in regulatory costs. It also empowers the Director of the Office of Management and Budget to cap the incremental costs of new regulations in subsequent years. It expansively interprets “regulation” to encompass interpretive guidance, and revokes a controversial Biden Administration directive that undermined long-standing cost-benefit analysis methods. It exempts military, foreign affairs, immigration, and homeland and national security measures, and makes other exemptions possible where estimated costs of a proposed regulation to the private sector are low. Overall this is positive for federalism insofar as it reduces the regulatory burden on states and communities.

 What to watch: The order cites 1993 Executive Order 12866 to direct agencies to systematically track and limit their regulatory proposals via a Unified Regulatory Agenda. EO 12866 is also noteworthy for its direction that agencies “seek views of appropriate State, local, and tribal officials before imposing regulatory requirements that might significantly or uniquely affect those governmental entities,” and “harmonize Federal regulatory actions” with the regulatory frameworks of those entities. Going further by restoring President Reagan’s 1987 Executive Order 12612, which required federal agencies to cooperate with states when crafting regulations, would be an even stronger pro-federalism move.

Unleashing Prosperity Through Deregulation – The White House

January 31, 2025