Why Biden will get rid of the ‘two-for-one’ regulation order on day one

It won’t get the attention of rejoining the Paris Climate Accords or halting building on the wall at the southern border, but President-elect Biden will likely retract a large number of executive orders on his first day in office. One downside to using executive orders to govern as President Trump did, is that they are very easy to reverse.

Executive orders govern the management of the executive branch and do not impact the public directly. But, in numerous instances, they have been used by presidents to direct agencies to take certain actions that can then affect the public. One example of this is Trump’s Executive Order 13771 which requires agencies to withdraw two regulations every time they issue a new one, and to prepare a regulatory budget. The idea behind both proposals is to push agencies to repeal existing regulations.

The order has been — at most — a limited success.

It may have deterred executive branch agencies from issuing new regulations (although the dearth of new regulations under the Trump administration can more likely be explained by Cabinet Secretaries with deregulatory preferences). However, in a recent report with Professor Cary Coglianese and Natasha Sarin of the University of Pennsylvania, we showed that the Trump administration has done much less repealing of regulations than they have claimed. And the economic impact of their limited deregulating has likely been minimal and probably has had negative economic consequences.

Despite the limited impact of EO 13771, it is still a prime candidate for repeal on day one of the Biden administration. On the one hand, the executive order is bad public policy. For four decades, presidents of both parties have endorsed evaluating regulations using benefit-cost analysis. These ideologically diverse administrations have agreed that a regulation should be promulgated only if the benefits it gives people (cleaner air, reduced risk of a terrorist attack, safer food) justify the costs it imposes (usually on businesses). 

Both requiring agencies to repeal two regulations every time they issue a new one, and a regulatory budget, subvert this logic. These two tools are essentially an assertion that the costs imposed by regulations are more important than the benefits they create. They elevate the concerns of one party affected by regulations over others. Benefit-cost analysis is far from a perfect tool. But it forces agencies to consider all of the effects of their actions, not just their costs.

EO 13771 undermined the principle of caring about all of the impacts of regulation.

Second, repealing the executive order is good politics. Despite the limited deregulatory reach of the Trump administration, EO 13771 has become a symbol of the administration’s commitment to ignoring those who benefit from regulations. Its repeal would be a strong signal to labor unions, advocates for a clean environment, and others who support robust public health initiatives that this new administration has a very different set of priorities.

Finally, while a “two for one” order and a regulatory budget meant little in an administration that probably wouldn’t have done much regulating in any case, the tools contained in EO 13771 could constrain the Biden administration in some of its top priorities.

Importantly, the president-elect has announced his intent to aggressively tackle climate change. With legislation unlikely in Congress regarding climate change, issuing environmental regulations is likely to be the primary policy tool for the Biden administration. Issuing regulations becomes much more challenging if they have to repeal two regulations every time they tighten standards on carbon dioxide or methane emissions.

The Biden administration has a gargantuan task ahead of it just in changing the direction of the executive branch of government. But some steps are easy both politically and administratively. Repealing Executive Order 13771 is one of them.

Stuart Shapiro is professor and director of the Public Policy Program at the Bloustein School of Planning and Public Policy at Rutgers University, and a member of the Scholars Strategy Network. Follow him on Twitter @shapiro_stuart.