President Donald J. Trump recently issued a new executive order (EO) that will require “independent agencies” to submit their rulemaking to the Office of Management and Budget (OMB) for review. Interestingly (but unsurprisingly), this led to a deluge of news articles and quotes from opponents of the administration decrying the move as a power grab and part of an anti-regulatory agenda. But these articles seem to misunderstand what OMB review means. In truth, Trump’s latest move is one that regulatory reformists have suggested as far back as 1990 and would address a longstanding concern that not all government regulation is held to a suitably high standard.
Independent agencies and the gap in oversight
The federal government promulgates many regulations, which mainly come from conventional agencies like the U.S. Environmental Protection Agency or from independent agencies like the Securities and Exchange Commission (SEC) or the Federal Energy Regulatory Commission (FERC). Both types are tasked with regulating in a manner that captures net benefits to the public. (Past Low-Energy Fridays pieces have explained the difference between good and bad regulation.) But while regular agencies and independent agencies aren’t all that different in practice, they are accountable in different ways.
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The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.
