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President Donald Trump's deregulation initiatives might eventually run into challenges from the courts and Congress as businesses work to navigate a changing and complex regulatory framework.
Trump signed an executive order launching the 10-to-1 deregulation initiative in January. For every new rule, regulation or guidance a federal agency proposes, it must repeal 10 existing ones. Overregulation "stops American entrepreneurship, crushes small business, reduces consumer choice, discourages innovation and infringes on the liberties of American citizens," according to Trump's order.
This marks a significant escalation from Trump's first-term policy, which required agencies to eliminate two regulations for each new one issued. Since taking office, Trump has signed multiple executive orders focused on deregulation. Meanwhile, Elon Musk, who leads the U.S. Department of Government Efficiency (DOGE), has systematically halted or frozen federal agency funding and work.
Rob Atkinson, founder and president of the Information Technology and Innovation Foundation, said the Trump administration wants to shrink the federal government radically. Requiring federal agencies to eliminate 10 rules, regulations and guidance documents for each new one proposed is "unbelievable."
"That seems to be gutting the entire regulatory state," he said.
However, Trump might soon face multiple legal and congressional hurdles on his path to deregulation. It's an issue Trump faced during his first administration, when many of his attempts to overhaul regulations were overturned in federal court, Atkinson said. Such an aggressive approach to regulation overhaul is "quite risky" for businesses, he added.
Trump would repeal a regulation, only to face a lawsuit, which the administration lost most of the time because congressional action was required to remove the rule, he said.
What businesses can expect
While the 2-to-1 deregulation initiative during the first Trump administration kept new rules to a minimum, Atkinson said it didn't necessarily reduce existing regulatory paperwork and processes. However, this administration's 10-to-1 deregulation initiative and efforts undertaken by Musk and DOGE send a stronger deregulatory message to businesses, he said.
What Trump wants to do now is go way beyond that -- radical hacking and cutting into the regulatory state.
Rob AtkinsonPresident, ITIF
"He slowed the rate of growth of the regulatory state," Atkinson said of Trump's first administration. "What Trump wants to do now is go way beyond that -- radical hacking and cutting into the regulatory state."
Atkinson said he believes the Trump administration's greatest effect will continue to be on limiting new rule development and implementation. Getting rid of existing rules and regulations is a different story, he said.
Some policymakers are also speaking out against Musk's power in the executive branch. Trump's deregulatory goals can only be achieved with Congress's support, Atkinson said. However, Republicans maintain a majority in both the House and the Senate, which Atkinson said will likely be more in line with Trump on deregulation.
Matthew Bisanz, a partner at Mayer Brown, said while some of Trump's actions, like the 10-to-1 deregulation initiative, function as posturing for the administration's deregulation goals, the real effects will come down to federal agency leadership.
For digital assets and cryptocurrency, for example, Bisanz said the Trump administration is focused on tailoring a regulatory framework rather than eliminating regulation completely. The U.S. Securities and Exchange Commission has created a crypto task force to recommend policy measures.
"I tend to think of the 10-to-1 initiative as being more aspirational and motivational," he said.
Makenzie Holland is a senior news writer covering big tech and federal regulation. Prior to joining Informa TechTarget, she was a general assignment reporter for the Wilmington StarNews and a crime and education reporter at the Wabash Plain Dealer.
