Does Deregulation Move Markets? Be Skeptical

High spirits.

Photographer: Michael Nagle/Bloomberg

From the very start of his presidency, Donald Trump has made it a high priority to reduce the level of federal regulation. And in 2017, the stock market has boomed. Many business leaders believe that this is hardly a coincidence, and that Trump’s deregulatory efforts have fueled the boom. Are they right?

Probably not — but it’s complicated. 

There are lots of estimates of the costs of federal regulations, and they’re mostly rubbish — interest-group fare. The least unreliable figures come from the annual reports of the Office of Management and Budget. Under both Republican and Democratic administrations, the reports are produced by civil servants; they’re not political documents. (I was head of the Office of Information and Regulatory Affairs from 2009 to 2012, and political interference with the numbers in those reports was taboo.)