One of the first things Donald Trump did as soon as he began his his term as president of the United States, is he signed into law Executive Order 13771.
Under this law, each federal ministry and agency is obliged to eliminate two regulations for each new approved law. In addition, the decree requires that the net cost of introducing new regulations must be equal to or less than zero, which implies accompanying any measure of regulatory reinforcement with compensatory deregulation actions. The problem of over regulation has significantly depressed economic activity in the United States.
In 1960, regulation approved by the federal government added 20,000 pages, while in 2016 that number ballooned to a whopping 185,000. Such crippling regulations began to be reversed in 2017, when the Trump government achieved a spectacular result in deregulatory matters, with 22 normative withdrawals for each new norm approved.
The benefit of deregulation
The impact of the deregulatory agenda is already being felt in the private sector. The Council of Economic Advisors of the United States considers that, if this type of policy is maintained during the next five years, the average citizen’s income will have gone up 0.8%, an amount equivalent to $1,200 per household.
A good example of the savings generated by this new strategy is in the expense that consumers assume when signing up to cell phone or internet services. Since the first quarter of 2017, this disbursement has fallen by 3%, thanks to a series of deregulatory measures introduced by the government. Another good example of the savings passed down by the new regulatory framework is at the pharmaceutical level, where new federal rules have been modified to facilitate savings in the purchase of medicine. Compared to the expected spending levels for 2019, Americans now pay 11% less every time they go to the pharmacy.