Regulatory Costs: A Hidden Economic Burden
Federal regulation is an invisible force reshaping the economy, costing trillions annually. The “costberg”—a metaphor for the vast submerged body of rules, guidance, and paperwork—continues to grow, having a monumental impact on businesses without any direct democratic input. According to the latest Ten Thousand Commandments report, the regulatory burden is estimated at over $2 trillion annually, exacerbated by the explosion of agency memos and directives that evade traditional public-notice rulemaking.
Despite efforts to streamline and reduce the impact of this burden, the reality is that much of this regulation slips through unremarked upon, often bypassing Congress. As former President Barack Obama famously put it, the executive branch’s “pen and phone” has allowed sweeping regulatory action without legislative approval.
Trump’s Regulatory Reform Progress and Setbacks
During Donald Trump’s first term, efforts to impose order on federal rulemaking brought some relief, with initiatives like the “one-in, two-out” rule designed to curb excessive regulations. However, the COVID-19 pandemic disrupted these reforms, fusing expansive spending with regulatory power. What began as emergency management became permanent governance, with an expanded federal footprint justifying price controls and supply chain interventions.
President Joe Biden’s administration further accelerated these trends with its “whole-of-government” approach on climate, equity, and care economy initiatives. Biden’s regulatory review order dismantled much of Trump’s regulatory streamlining, replacing it with a framework focused on “net benefits” as defined by progressives. This shift marks a significant departure from cost-benefit analysis, prioritizing wealth redistribution and safety nets over economic efficiency.
Regulatory Expansion and Bipartisan Challenges
Despite Trump’s regulatory rollback efforts, the regulatory state continues to expand. The bipartisan nature of this problem is evident in large-scale legislative interventions such as the CARES Act, Bipartisan Infrastructure Law, and the CHIPS and Science Act, all of which introduce significant regulatory frameworks. While some may point to these laws as bipartisan successes, they also underscore how spending-driven regulatory expansion has become a permanent fixture in Washington.
In truth, this regulatory growth is not limited to one party. Both Republicans and Democrats have contributed to a regulatory state that continues to limit economic freedom and stifle business innovation.
The Path Forward: Reforms and the “Abuse-of-Crisis Prevention Act”
While the regulatory state looms large, there is hope for reform. As Trump enters his second term, regulatory reform is on the table once again. Proposals for regulatory budgeting, requiring Congressional approval for major regulations, and even eliminating outdated agencies are gaining traction. Most significantly, Trump’s Executive Order 14,219 calls for the “Deconstruction” of the administrative state—a bold move aimed at trimming the regulatory fat that slows economic growth.
For real progress to be made, however, Congress must back up these reforms legislatively. Without congressional action, regulatory expansion will continue to erode the gains made in Trump’s first 100 days. The ultimate solution may lie in curbing the power of federal agencies through reforms like a Regulatory Reduction Commission, sunsetting regulatory rules, and establishing an annual regulatory report card.
Additionally, the proposed “Abuse-of-Crisis Prevention Act” would impose limits on the government’s ability to expand during crises, ensuring that temporary measures don’t become permanent regulatory encroachments. This act would guard against the tendency of lawmakers to exploit economic shocks to expand the federal government’s reach.
A Call to Action
As President Trump approaches his second term, the unfinished business of liberty demands action. The next 100 days are critical for continuing the fight against excessive regulation and reclaiming a government that serves the people, not bureaucratic interests. While challenges remain, there is a growing reform movement that could reshape the future of federal regulation—provided that the political will exists to confront the “costberg” of government overreach.
