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As the Trump Administration pushes policies promoting massive, swift deregulation, Democrats of the House Committee on Small Business are drawing attention to benefits from rules that protect the environment and public safety. In a hearing today, Democrats expressed concern over the impact that President Trump’s Executive Order 13771 will have on small businesses and the American public. Under the Order, for every new regulation issued, at least two prior regulations are slated for elimination.

“While we certainly must be mindful of how regulations affect small businesses, the Trump Administration’s proposal to cut two regulations in exchange for every new one implemented is arbitrary and economically reckless,” said Ranking Member Rep. Nydia M. Velázquez (D-NY). “We cannot lose sight of the fact that many regulations exist to protect our health and safety and some of them provide small businesses with stability or protection from unfair advantage by their larger competitors.” 

In her testimony, Lisa Heinzerling, Professor of Law at Georgetown Law School, also expressed her concern for the consequences of President Trump’s executive order.  

“President Trump has made deregulation a central goal of his domestic policy,” said Heinzerling. “Through the so-called ‘2-for-1’ order on regulatory costs, President Trump has also placed strict limits on the development of new regulations. Indeed, it appears to be the official policy of this administration that regulatory benefits do not count when one is evaluating the wisdom of regulatory policy. Under the 2-for-1 executive order, a reduction in regulatory costs is considered a success no matter how dearly we all pay for it in benefits forgone.”

In her testimony, Heinzerling notes that the Environmental Protection Agency’s (EPA) regulatory budget has faced particularly dramatic cuts under the Trump Administration. Heinzerling cited data from the Office of Management and Budget (OMB), detailing benefits from EPA regulations.

“No agency in this administration has taken a bigger axe to existing regulatory programs than the EPA,” Heinzerling testified. “Yet OMB has also reported that EPA rules outperform the rules of all other agencies combined in terms of producing net monetized benefits. OMB estimates that from 2006 to 2016, EPA regulations provided as much as $706 billion in 4 benefits – measured in such terms as lives saved, illnesses averted, and environmental degradation reduced – while imposing no more than $65 billion in costs.” 

During the hearing, Democrats drew attention to how regulations can mitigate damage from disasters like Hurricane Harvey and the BP oil spill. 

“When zoning rules are weak, Hurricanes can wreak much more havoc on a city, harming small firms,” Velázquez noted.  “Likewise, environmental catastrophes, like oil spills can devastate local economies that rely on fishing or tourism.  Too often, discussion surrounding regulations focuses only on costs, ignoring completely the ancillary benefits of these rules.”  

Democratic lawmakers concluded by noting the need for balance in regulatory policymaking.

“America’s small business deserve a level playing field, and to this end we must acknowledge and eliminate burdensome regulations and paperwork requirements,” Velázquez concluded. “That requires thoughtful policymaking, not blindly hacking at the underpinnings of consumer, environmental and public health safeguards as this Administration proposes. Mindlessly attacking our regulatory framework doesn’t assist entrepreneurs, but simply helps big companies at the expense of entrepreneurs.” 

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