One of the expected growth actions by President Trump is a more lenient regulatory landscape for businesses. During Trump’s first term, his goal was to eliminate two regulations for each new one passed into law. In his second term, he has targeted a 10-to-1 reduction ratio. While some business leaders are skeptical he will be able to achieve this number of cuts, there is little doubt that his administration will shift the overall regulatory landscape, says CapTrust and American Action Forum. That’s good—we need regulatory reform, and badly.
Regulations in the U.S. are generally designed to protect against the potential actions of dirty players and fraudsters in the world of capitalism. Yet the business community’s expense of creating and implementing internal protections to abide by regulatory requirements either reduces profits or increases consumer prices. Or both.
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Recent rules regarding fuel efficiency, emission standards, drinking water regulations, climate change, and Medicare staffing, all potentially protective policies, have caused the costs of compliance to soar. Combined, the estimated cost of complying with the regulations adopted during Joe Biden’s term exceeded $1.8 trillion. This compares to $500 billion in costs in Barack Obama’s first term and less than $100 billion in Trump’s first term.
Trump’s more lenient regulatory approach is expected to speed up U.S. business growth, but no one knows at what price. But here are helpful recommendations for how he could achieve this:
- Roll back Biden-era regulations: Mr. Trump could use executive orders and administrative rule changes to repeal or modify costly regulations imposed in the Biden administration, particularly in sectors such as finance, energy, and health care.
- Reinstate the “One-In, Two-Out” Rule: During his first term, Trump required federal agencies to eliminate two existing regulations for every new one they introduced. A similar policy could be re-implemented to curb regulatory expansion.
- Reduce environmental regulations: Trump has criticized Biden’s climate policies, including stricter EPA regulations. He could ease rules on fossil fuel production, emissions standards, and permitting processes to boost domestic energy production.
- Overhaul federal agencies – He could push to re-structure or scale back agencies like the SEC, EPA, and OSHA to reduce or eliminate their regulations, which could lead to lower compliance costs for businesses.
- Judicial and legislative actions – Appoint conservative judges who favor deregulation. This could help strike down costly regulations. Also, the Republican Congress could pass legislation limiting the ability of agencies to create new regulations without Congressional approval.
- Encourage state-level decision-making: By shifting regulatory power to states, Trump could reduce federal oversight and allow businesses to operate under potentially less restrictive state rules.
How about it, President Trump?
Other stories you may want to read:
- John R. Smith: A Turning Point for America: Pondering Trump’s Plans & Obstacles - March 12, 2025
- John R. Smith: Regulatory Relief for Businesses May be On the Way - March 5, 2025
- John R. Smith: Known Knowns, Known Unknowns, and Unknown Unknowns - February 19, 2025