An emergency lawsuit seeks to overturn a Trump administration executive order that could have dire consequences for public safety and well-being. I’m not talking about the executive order on immigration but about the one on regulation, which three groups are seeking to overturn in the Washington, DC, federal district court. In the lawsuit, Public Citizen, the Natural Resources Defense Council, and the Communications Workers of America argue that the order, among other things, “directs federal agencies to engage in unlawful actions” that violate the statutes governing their existence.
In the blizzard of signing ceremonies, you might have forgotten that Trump issued an executive order mandating that federal agencies eliminate at least two regulations for every one they bring into existence, and that the total net costs of regulations on individuals and business entities in 2017 must be $0. In other words, costs of any regulation must be offset by repealing regulations with equivalent costs.
The three groups consider this illegal for several reasons. They argue that no congressional statute authorizes federal agencies to offset the costs of regulations, and that the order is “arbitrary and capricious” in setting a random limit for all regulatory costs. This would violate a key clause of the Administrative Procedures Act that governs federal rule making. And the groups argue that the order would force agencies to repeal regulations that they’ve already determined through a deliberative process “advance the purposes of underlying statutes.” Therefore, any repealing of regulations under the executive order would violate the governing statutes of the various agencies. This usurps Congress’s authority, and violates the president’s constitutional obligation to “take Care that the Laws be faithfully executed.”
As I’ve noted, the regulation order, which applies to“significant” regulations costing $100 million or more, was little more than a paperwork generator, forcing federal agencies to perform all sorts of analyses and make public comments before they could ever get a regulation out the door. The interim guidance on the order from the Office of Management and Budget (OMB), issued last week, makes this even more clear.
First of all, the OMB exempts “purely deregulatory actions that confer only savings to all affected parties,” making the order a one-way ratchet. Second, the definition of “costs” does not take into account the benefits from consumer, environmental, or safety protections. The OMB specifically says that, for example, cost savings to consumers for regulations requiring energy-efficient technologies in home appliances “would not be counted as offsets to costs.” So to simplify a bit, if Maytag has to spend $100 on a washer-dryer by adding energy-efficient controls, and it saves the purchaser $1,000 in energy costs over the life of the appliance, the OMB sees that regulation as “costing” $100, and the Department of Energy would have to cut a regulation that costs $100 to offset that.