Will Trump’s Regulatory Rollbacks Survive?

The Trump Administration has taken aggressive steps to undo the regulatory accomplishments of former president Obama, with some of the highest profile rollbacks taking place in the energy and environmental arenas. In his three years in office, President Trump has repealed the Clean Power Plan, rolled back restrictions on methane leaks and, most recently, repealed limits on automotive tailpipe emissions.

Yet, it’s possible that the same tools that Trump has used to undo the regulatory achievements of his predecessor could be turned against him.

A pair of regulatory experts take a look at President Trump’s unprecedented use of three legal tools to pursue his deregulatory agenda, and at how a new administration could use these same tools to roll back Trump-era rules. They also discuss how the very nature of future presidencies may be altered as the deregulatory gloves have been taken off, limiting the ability of presidents to enact important rules on any front.

Full Transcript

Andy Stone: Welcome to the Energy Policy Now podcast from the Kleinman Center for Energy Policy at the University of Pennsylvania. I’m Andy Stone. The Trump administration has taken aggressive steps to undo the regulatory accomplishments of former President Obama, with some of the highest-profile rollbacks taking place in the energy and environmental arenas. In his three years in office, President Trump has repealed the Clean Power Plan, rolled back Department of Interior restrictions on methane leaks, and most recently repealed limits on automotive tailpipe emissions. Yet it’s possible that the same tools that Trump has used to undo the regulatory achievements of his predecessor could be turned against him. On today’s podcast, we’ll take a look at how President Trump has made unprecedented use of three legal tools to pursue his deregulatory agenda, and how a new administration could use these same tools to roll back Trump-era regulations.

My guests are two legal experts who have written extensively on regulation. Bethany Davis Noll is Litigation Director at the Institute for Policy Integrity at New York University School of Law. Richard Revesz is Dean Emeritus at NYU School of Law and directs the Institute for Policy Integrity. Bethany and Ricky, welcome to the podcast.

Richard Revesz: Thank you so much for having us.

Bethany Davis Noll: Yes, thanks for having us.

Stone: Ricky, to get us started, could you tell us how presidents use regulation, and why new presidents might want to undo the rules that were put in place by a prior administration?

Revesz: Sure. Legislation is typically written at a fairly high level of generality, and Congress relies on administrative agencies to fill in the details as the legislative programs get implemented. For example, in the Clean Water Act, Congress set out its goal to restore and maintain the chemical, physical, and biological integrity of the nation’s waters. And that’s a very good goal, but in order to implement it, a lot of specific details need to be figured out. Which sources are regulated? To what extent are they regulated? What are the deadlines for compliance, and so on. And that’s work that typically Congress delegates to administrative agencies.

In recent years, Congress has faced significant gridlock, so it’s difficult for it to enact legislation. As a result, policies that presidents might have tried to get enacted by Congress in the past are now adopted by administrative agencies pursuant to existing, as opposed to new statutes. And that’s a reaction to this phenomenon, that after an inter-party transition, the new president will want to roll back certain of his or her predecessor’s regulatory policies. And that’s the issue that interested Bethany and me, and it’s why we set out to do this work.

Stone: So as you said, regulation has become relatively more important because of the gridlock in Congress.

Revesz: That’s right.

Stone: So Bethany, what tools have presidents traditionally relied upon to roll back regulations?

Noll: Traditionally, after an inter-party transition, there were two big tools that presidents could rely on. First, a new president generally will issue what is known as a “stop-work order,” which is a memo directing all agencies that are still preparing draft rules for the prior administration or that have recently sent rules for publication to pull it all back — you know, basically, “Stop your work in the prior administration’s rules.” There is a limit to how much that can accomplish, though, because it only works on very recently completed or pending rules.

In addition, the other big tool that presidents have traditionally relied on is repeals or amendments that are promulgated through traditional means, using notice-and-comment procedures under the Administrative Procedure Act. Though it’s the traditional tool, it also has some limits because it takes time and a lot of agency resources to pursue that route.

Stone: President Trump has been very aggressive in attempting to roll back regulations put in place by former President Obama. What major energy-related rules, Ricky, has Trump sought to roll back?

Revesz: Trump has been extremely aggressive and has sought to roll back a whole bunch of rules. For example, he sought to first repeal, and then roll back the Clean Power Plan, which is the rule that limits the greenhouse gas emissions of existing power plants. He has weakened the legal foundation for the Mercury and Air Toxic Standards, which limit the emissions of hazardous air pollutants by power plants, as well. He has delayed rules limiting how much mercury a power plant can release into waste water, has delayed rules limiting methane emissions from oil and gas installations, delayed rules that were supposed to clarify royalty payments for mining on federal land. He has now tried to significantly roll back the greenhouse gas limitations and fuel economy standards for automobiles. The list just goes on.

Stone: Bethany, a moment ago you gave us a quick overview of some of the traditional tools that presidents have used to roll back regulations put forth by prior administrations. And you made a point of the fact that those tools are pretty limited. Now, Trump has used three administrative and legal tools to undo Obama regulations that have not really been used much in the past. Their use is actually quite unprecedented. Early in his term, Trump used what’s called the “Congressional Review Act.” What is the Congressional Review Act, and how does it work?

Noll: Yes, that’s right. These three tools are the tools we discuss in our piece. The Congressional Review Act basically gives Congress the opportunity to disapprove or repeal an agency regulation through streamlined procedures. The statute allows Congress to bypass the usual 60-vote requirement to overcome a filibuster in the Senate, which means that more partisan bills can pass. You only need a bare majority to pass a disapproval under the Congressional Review Act. It allows a new Congress and president, after an inter-party transition, to disapprove of regulations that were issued within approximately the last six months — so the prior president’s term. So it’s a very powerful tool that a new president can use, assuming both houses of Congress line up with the president.

Stone: And that’s an important point, right? If the president doesn’t have Congress on his or her side, then Congress won’t even act to undo these rules in the first place. That’s why the Trump administration was able to take advantage of having a Republican House and Senate, when it came into office three years ago.

Ricky, it’s worth noting that President Trump has used the CRA sixteen times, whereas the three presidents before him only used it one time, combined. If the CRA is so effective, as Bethany just mentioned, why did earlier presidents tend to avoid using it?

Revesz: For a couple of reasons. First, this idea of dismantling the policies of the prior administration has taken much more vehemence in the Trump administration. You hear it in the political rhetoric and the references to President Obama in extremely negative terms. I think in the past, presidents did not think it was in their political interest to spend a lot of time trashing their predecessors, and instead wanted to implement policies going forward.

So the nature of the political debate has unfortunately changed, and the polarization of the parties has changed. Also, there is a tradeoff, because Congressional Review Act disapprovals have to be done within a pretty short period of time after the new president takes office — so the first couple of months, approximately, depending exactly on what days Congress actually holds sessions. And that can be a very busy time for administrations, so they have to figure out whether they want to allocate Senate time, which is a very precious resource, to Congressional Act disapprovals, or to other things. And the other things could be the confirmation of executive branch officials to staff up the political positions in the new administration, or it could be for major legislative initiatives — something like the Affordable Care Act or Waxman-Markey, President Obama’s plan that ultimately did not pass — to control greenhouse gas emissions economy-wide.

Presidents have to make that tradeoff. Prior presidents seem to have made that tradeoff in different ways, and President Trump made it in this way. He actually seemed not particularly concerned about confirming Executive Branch officials quickly. A lot of these positions stayed vacant for a long time. He made much more active use of acting people than had been true before. So the dynamics changed with this administration. I think that explains the significant difference in the numbers of Congressional Review Act disapprovals.

Stone: It does sound like the CRA is a significant draw on Congress this time.

Revesz: It definitely is, because there is a prescribed time for Senate debate that has to be set aside, and that’s a scarce resource. And there’s a significant tradeoff.

Stone: Now, there are two other key tools that you point out in your writings, that the current administration has used aggressively to roll back energy and environmental regulations. Bethany, can you tell us what those two other tools are?

Noll: Yes, Ricky alluded to one earlier, something that we could term “suspensions.” Those are new regulatory actions from an agency that put off deadlines in a prior rule. The Trump administration used this tool aggressively at the beginning of the administration to put off deadlines on Obama-era rules. This was important to the Trump administration because once a rule is implemented, that takes away much of the impetus for repeal. Imagine that you’ve already spent money complying with a regulation. If an agency, then, rolls that regulation back or pauses it, all you’re doing is harming the American public and not saving any money. So aggressively suspending even long-standing regulations was a big priority of the Trump administration at the beginning.

Another tool that the Trump administration used was something known and “abeyances,” and those are court orders that put a pause on litigation. Many of the Obama-era rules were under review in court when the transition happened, and putting a pause on that litigation was also important to the Trump administration, because having a court bless the Obama-era rule would have complicated the Trump administration’s efforts to repeal those rules. For example, if the Trump administration wanted to argue that the Obama-era rule was illegal or legally unsound for whatever reason, and you have a court blessing the rule, that would complicate those efforts. In prior transitions, other administrations have asked for abeyances like this only when a court decision was a long way off — for example, in cases that have not yet been briefed. In those kinds of cases, it’s more reasonable to imagine that the agency will have finished rewriting the rule before a court can issue its decision. But the Trump administration asked for abeyances in all sorts of cases, many of which had already been briefed, and even one of which had already been argued.

Stone: Now that’s one of the unusual things that the Trump administration has done. One of the reasons that abeyances are possible is that they save the court from putting in the resources to hear a case that the government isn’t going to support under a new administration, anyway. It sounds like the Trump administration has gone way past that point, as you just said. The courts have already invested the time to hear these cases, and then the administration has asked for the abeyances. Is that correct?

Revesz: Yes, and actually to give you the most extreme example was the Clean Power Plan. The challenge to the Clean Power Plan had been argued in September of 2016, to the en banc D.C. Circuit — that is, all of the judges of the D.C. Circuit. And the argument had gone on literally all day. This was in September. Around March, Trump had taken office, the case had not yet been decided, and then the government sought an abeyance. So at that point, not only had the judges read the briefs, had they prepared for oral arguments, they had had oral arguments, and we were almost six months after oral arguments. So it’s almost certain that there were draft opinions — maybe draft opinions, draft dissents, concurrences, other dissents — that would all have been drafted. So the case was practically decided. And in fact, it’s not clear at all that asking for the abeyance and getting it is actually saving judicial time because a lot of the very same issues that were at stake in the Clean Power Plan are now going to come up in connection with the review of the ACE rule, which is the Trump administration’s very, very significant rollback of the Clean Power Plan.

And in fact, if the court had decided the Clean Power Plan challenge, it would have been proper guidance for this administration and others on how to interpret the statute. So it’s really not clear at all that this saved judicial time. Those arguments were made to the court, but for whatever reason, the court actually did grant the abeyance, and then kept the case in abeyance for years while the Trump administration tried to figure out what to do. Initially it sought to repeal the Clean Power Plan. Then it sought to roll it back. It was a very long, drawn-out process.

Stone: Is there any insight into why the courts would have said “okay” to the abeyance request? It sounds like it was really late in the game.

Revesz: It was very late in the game. It seemed unusual. So this is the most extreme case. There were others that were also where it was late in the game, though not quite as late. I think the courts were still kind of learning their way around these issues. Abeyance requests were typically routinely granted because they arose in different, much earlier times. And it’s possible also that the court thought that the Trump administration would act more quickly.

It is awkward to decide a case involving a rule that the administration is actually no longer defending and is, in fact, attacking it. I can understand why the court found this difficult, but the traditional justification of saving judicial resources probably did not apply in connection with the Clean Power Plan’s judicial review.

Stone: Is there a requirement for a new administration to have a new regulation in mind when it asks for either a suspension or an abeyance? It would seem to me that the government, as the prior administration, would have invested significant resources in justifying these new regulations. It would seem kind of odd that a new administration would just walk away.

Revesz: And that’s what happened here. Basically, none of this work had been done when the abeyance was requested. All that was said is, “The president has announced that he wants to reconsider this, so we should place it in abeyance while the agency can consider what changes it has to make.” Now, as a practical matter, to propose a new rule is going to take a year or year-and-a-half. And so there is no way that work can be done all that quickly. So a new administration probably doesn’t have a written, kind of proposal rule in play, so the time to request an abeyance. My guess is we’ll learn more about how courts treat this issue now that they’ve had the experience of the Trump administration.

Noll: Yes, to add to that, I think one sort of pernicious effect of all this is deregulatory uncertainty that all these abeyances and suspensions cause. I mean, it’s a lot easier for industry to comply with something if they know what’s coming, and then the new rule is finalized, and then it gets implemented — and there aren’t changes on the way, or uncertainty about whether there will be changes. And the Administrative Procedure Act sort of contemplates a much more stable environment, and all this effort to change things — or promise to change things, and then we don’t really know whether the agency will be able to pull together the record to actually change it — causes significant and harmful regulatory uncertainty.

Stone: And then the industries don’t know whether they need to invest the time and the financial resources to comply, if there’s a good chance that those regulations may be undone at some point in the future, it sounds like.

Revesz: Yes, and actually from the perspective of the regulating community, often certainty is more important than getting the precise, right regulation because they need to plan for long-term investments and so on, which is one of the reasons that a lot of the car manufacturers actually opposed the rollback of the vehicle standards, which the administration justified as something that was going to help the automakers. It turned out that many of them actually did not want that. And one of the reasons they didn’t want that is because they understood how volatile the regulatory climate would become. If Trump actually did this, the next Democratic administration would change course and go back to the stringent regulations. And from their perspective, that was not an attractive scenario. It was probably better to have kind of a more consistent policy that stays in place in the long run.

Stone: So Bethany, overall, just how successful has this Trump administration been in its efforts to roll back Obama-era rules?

Noll: So at Policy Integrity, we’ve been tracking the outcomes of litigation over the Trump administration’s use of agencies to deregulate, as well as to implement other policy priorities. And at current count, the Trump administration has been losing at a rate of about 90%.

Stone: Wow.

Noll: That includes all the cases where the administration was sued, as well as the cases where the administration pulled back on regulation after being sued. You can compare that to prior statistics. There are studies that have looked at how successful agencies have been in the past. And before this era, the studies showed agencies winning 70% of the time. So that compares to a 10% win rate for the Trump administration.

Of course, there are a number of new cases right now and new regulations that are being finalized right now, like the vehicle emission standards, obviously, which are still in litigation phase. And those aren’t included in my stats. But that’s the stat as it stands right now.

Stone: Now we get to a really interesting point, Ricky. It seems that the deregulatory tools that Trump has used could come back to haunt him. Why might this be?

Revesz: Yes, I think it will come back to haunt Trump, and the reason is this. By making this very aggressive use of these tools, Trump has made it easier for the next administration to do the same. That is, the Trump administration broke certain norms. Once they’re broken, it’s easier for the next administration to follow what looks like the new normal. So for that reason, I predict that these tools — Congressional Review Act disapprovals, abeyances, suspensions — are going to be used more aggressively by the next Democratic administration, compared to prior Democratic administrations.

That’s one point. The second point is the one that Bethany just mentioned. It’s that because the Trump administration has been so analytically sloppy, it has lost the vast majority of the cases in which its regulatory policies have been challenged. So it broke a norm in order to get some policy benefits but then did its work so badly that it didn’t end up getting the policy benefits. So now a new administration is inheriting this broken norm, so they can be aggressive in undoing regulations, but they also know that sloppy analytical work leads to judicial reversals. So if they do their work right, they will be able to succeed at undoing Trump policies in a way that Trump was not able to succeed at undoing Obama policies.

Stone: So are we saying, then, that the low success rate — to this point of the Trump administration in rolling back Obama-era regulations — is not so much due to the fact that they’ve pushed for abeyances and suspensions, for example, late in the game, but more to do with the fact that their legal work has just been sloppy and has been rejected?

Revesz: Yes, I’d say it’s mostly with analytical work — their analysis of costs and benefits. That probably has been the sloppiest. And some of the significant rules were unbelievably sloppy. They made moves that were inconsistent with the first principles of economic theory. They became the laughing stock among economists. For some of the analysis, you couldn’t find a single respectable economist who would say that what they did was even plausible.

Stone: So Bethany, what Trump rules or actions might be most vulnerable to future rollbacks, if there’s a change in administration coming up? And are any of Trump’s regulations going to be easy targets for the Congressional Review Act, which again has the short timeframe for action?

Noll: Yes, we alluded to this earlier, I think, but any rewrites of EPA’s methane rules will be at risk. It appears the EPA is planning to rewrite rules that limit methane emissions at new oil and gas facilities. They are apparently pending. Those rules, by the way, have been under implementation this whole time, but the final Trump administration rollback hasn’t come out yet, and we’re already in June.

So when Trump came into office, the Congressional Research Service estimated that Congress could target any completed rules that were submitted to Congress for disapproval on or after June 13, 2016, under the Congressional Review Act. So that means we’re already at the deadline. As Ricky mentioned earlier, it’s possible that the deadline was even earlier because the way you calculate which rules you can attack under the Congressional Review Act is you look at how many legislative days have happened. And it’s possible there won’t be that many legislative days between now and the end of the year with what’s going on with the pandemic and so on. So we may have already passed the deadline. We may be far past the deadline, and there may be lots of rules that are finalized this year that will be subject to the Congressional Review Act.

And I’ll just say this sort of threat, this sort of risk does appear to have been putting pressure on the Trump administration to finalize things. So whether or not Congress flips, and whether or not the deadline is on June 13th or some other day, this threat is a near and present risk that the Trump administration is facing right now, and it’s causing the administration to rush rules out, without the analytical basis that they need for the rules to survive in court.

Stone: You know, there’s a passage I would like to read right now that comes out of the article that you published in The Regulatory Review, and which I think really gets to the root of a new era that we may be facing here. And here’s that passage. You wrote, “The Trump administration has ushered in a new era of aggressive regulatory rollbacks that is likely to become an enduring feature of American politics and to radically change the nature of the presidency.” Ricky, could you tell us a little bit more what you mean by that?

Revesz: Sure. It’s an excellent question. We mean a whole number of things. So first, we mean that a one-term president might not be able to have his policies reflected in regulation in a way that will stick — that is, it will not be undone through the aggressive use of these tools. But it will also change a lot of the incentives that presidents face. For example, in the past, the president might have said, “Oh, we’ll wait for the second term to implement this policy, through this regulation.” It might actually turn out to be the case that waiting for the second term means it never ends up sticking, whereas if you do it in the first term and then get re-elected, it works.

And we can look back to the Obama administration itself, where most of the major policies of the Obama administration promulgated in the first term went into effect, are working, have been implemented, have been complied with, and so on, whereas a lot of the second-term policies ended up not seeing the light of day in a meaningful way. So a president might decide to make a different decision with respect to the timing of regulations.

Also, even in the first term, the president might decide to move more quickly. The Trump administration waited a long time. So for example, its most significant regulatory venture in this area is the rollback of the vehicle standards, and that happened in April of this year — more than three years into the Trump administration — which makes it more likely that it will be undone in ways that we’ve discussed. An administration might decide to move much more quickly and aggressively with respect to the publication of rules that are priorities for the implementation of its policies.

Stone: And I just want to emphasize here the fact that these rules, these regulations, often take three or four years to finalize, and then they go through legal review. So really, that three or four-year term is — you’ve got to do it all in that time.

Revesz: Yes, it’s short. It pretty much is coextensive with the presidential term. Future presidents might decide to explore whether that timeline can be moved up, and whether instead of taking three or four years, it could be done in two or three years. That year of difference could actually have an impact on the long-term outcomes.

Stone: Bethany, what else will future presidents need to do to prevent their regulatory accomplishments from being undone?

Noll: One big, important thing they need to do is get their rules out fast, as Ricky just alluded to. And that’s one reason why this is so important for us to be talking about right now. What a new president needs to do is get the rules out fast and make sure they come out early in the administration, and make sure they’re implemented before the end of that first term — which means, really, there isn’t very much time, and it means that advocates and potential transition team folks need to be thinking about how to support that effort now, how to support an effort to build a record, how to support an effort to target rules or to make plans for different policy priorities and make sure those rules can come out fast. They need to start thinking about that now, even before the election happens.

Stone: Ricky, let me ask you a final question here: Will we ever go back to the way things used to be? It seems like we’ve crossed sort of a regulatory line in the sand here.

Revesz: It’s an excellent question. We started out this session talking about legislative gridlock. Legislative gridlock is caused in large part by the fact that the parties are so far apart on the political spectrum right now. It wasn’t always that way. There was a time when there were conservative Democrats and liberal Republicans, and liberal Republicans were more liberal than conservative Democrats. There was overlap between the parties, and that created opportunities for coalitions to emerge. That’s essentially not true anymore. There’s almost no overlap along the political spectrum, between the parties in the U.S. Congress right now. But that could change. It could be either — just like the parties moved towards the ideological edges — they might, as a result of political factors, move closer to the center. And if they do, there might be overlap again. And if there’s overlap again, then coalitions will once again be possible. So that’s one possibility.

The other possibility actually works in the opposite direction, which is that the parties might continue in this sort of very oppositional phase of their political life and might decide to move to eliminate the filibuster for legislation. The reason we have this legislative gridlock is because of the U.S. Senate. Things do pass the House. It’s just that in the Senate, they can’t overcome the need to get 60 votes to invoke cloture. For example, in the Obama administration, the Waxman-Markey Bill passed the House. This is the bill to regulate the greenhouse gas emissions of power plants, but it could not overcome a filibuster in the Senate. It couldn’t get the 60 votes for cloture.

Now we’ve already gone down this path. When Democrats controlled the Senate, they got rid of the filibuster for the confirmation for executive branch officials and lower court judges. Years later, Republicans followed suit when they controlled the Senate and got rid of the filibuster for Supreme Court justices. And that’s why we now have Justice Grouch and Justice Cavanaugh. It’s quite possible that come next year, if Democrats control the Senate, the House, and the presidency, they might decide that the legislative filibuster should be eliminated, as well. That can be done on just a simple majority vote. I’m not saying that will necessarily happen, but it’s something that probably will be considered. It could happen.

So for one reason or another, that is — either the parties get closer together, or they stay far apart then become even more aggressive in their norm-breaking — we might end up in a world in which legislation is more possible. In that case, presidents will rely less on regulatory policy to implement big-picture policies. And in that case, the importance of these techniques will have been diminished.

Stone: Bethany and Ricky, thanks very much for talking.

Revesz: Thank you so much. We really enjoyed it. Thanks for including us.

Noll: Thanks for having us.

Stone: Today’s guests have been Bethany Davis Noll and Richard Revesz of New York University’s Institute for Policy Integrity. For more energy and environmental views, news, and research, check out the Kleinman Center for Energy Policy’s website or subscribe to our feed on Twitter. Our Twitter feed is @KleinmanEnergy. Thanks for listening to Energy Policy now, and have a great day.