About That Big Regulatory Rollback ...

Still, the overall message from the data seems to be that, as my fellow Bloomberg Opinion columnist — and OIRA administrator during Obama's first term — Cass Sunstein put it last September, "it's a lot easier to reduce the flow of new regulations than to eliminate those on the books."

What of the argument that deregulation has been a big boost to the economy since Trump took office, then? The current OIRA administrator, Neomi Rao, released a report late last year claiming that its deregulatory efforts had reduced regulatory costs by $23 billion in fiscal-year 2018, and $33 billion since Trump took office. Those numbers are almost certainly an exaggeration: As Connor Raso pointed out in a Brookings Institution report, they ignore the administration's own estimates of the economic benefits of some of the rules being delayed or repealed. And even taken at face value, $23 billion amounts to just one-tenth of 1 percent of GDP. If you're looking for what boosted economic growth in the last fiscal year, the $113 billion increase in the federal deficit brought on by tax cuts and spending increases seems like a far likelier candidate.

Still, the Obama administration in 2016 finalized regulations with annual costs that it estimated at $23 billion. It also estimated annual benefits of $45.3 million from those rules, but in general the costs are front-loaded and the benefits aren't. Shifting from that regulatory pace to one in which hardly any new regulations are being approved and a few are being repealed seems like it could well have a noticeable macroeconomic impact — possibly bigger than indicated by the dollar amounts, if reduced regulatory uncertainty stimulates hiring and investment. There may be truth to Larry Kudlow's claims.

Looking forward, though, the picture is muddier. For one thing, regulation isn't all bad! The air and water of the U.S. are much cleaner than they were a few decades ago, and workplaces much safer, thanks in large part to government-imposed rules. And while there surely is a lot of regulatory kludge (or maybe sludge?) that has developed through the years that could be removed without harm, there's not much evidence of a systematic effort to do that. Reported Bloomberg BNA's Cheryl Bolen last week:

Initial guidance directed regulatory reform officers, beginning with their agencies' fiscal 2019 performance plans, to report on their work, such as how many deregulatory actions were recommended. But a review of the performance plans of four of the most active regulators, such as the Environmental Protection Agency, shows that instead of numbers, charts are often filled in with "No Target Established" or "TBD."

Instead, the focus of the Trump administration's deregulatory agenda so far has been on overturning Obama-era regulations that were seen as harming certain industries, particularly those in the business of extracting things from the ground. These deregulatory moves have brought legal challenges. "For the projected long-run savings to materialize, agencies must present careful legal justifications of their decisions to modify or rescind existing rules," GW Regulatory Studies Center Director Susan Dudley — who was OIRA administrator in the George W. Bush administration — wrote in Forbes in October. "Their track record to date is not encouraging." In fact, it's awful: The administration's deregulatory won-loss record in the courts so far, according to the Institute for Policy Integrity at the New York University School of Law, is 2-29.

This apparent unpreparedness has introduced new uncertainties into the regulatory process, with even the seeming beneficiaries of some proposed changes — such as electric utilities in the case of pollution rules and automakers in the case of fuel-economy standards — pining for a less aggressive approach. Another concern expressed by Raso, a lawyer at the Securities and Exchange Commission who moonlights as a regulatory reform analyst (and seems quite good at it!), is that the Trump team's many failures in court are establishing precedents that will make it harder for future administrations to deregulate.

Philip Wallach, a senior fellow at the center-right R Street Institute, still thinks the Trump administration will eventually succeed in repealing two major Obama-era environmental regulations, the Clean Power Plan and the Waters of the United States rule, and might get its way on fuel-economy standards. But he doubts it will make much progress on removing "the decades of regulatory build-up before then." Why not? "My take is that there aren't private actors with sufficient incentives to drive that kind of deregulation, because existing firms are already compliant and have already baked compliance into their business models," he wrote in an email. Deregulation, in other words, may have less of a constituency than standing pat.

— For more Bloomberg Opinion columns, visit http://www.bloomberg.com/opinion.

Justin Fox is a Bloomberg Opinion columnist covering business. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of "The Myth of the Rational Market."