President Donald Trump has signed an executive order that grants the White House direct control over independent federal regulators such as the Securities and Exchange Commission, the Federal Trade Commission, and the Federal Communications Commission. This move aims to provide the president with more authority to shape oversight of the financial system and establish criteria for transportation safety, consumer protections, and various communication sectors.
The order is part of a broader effort by the Trump administration to assert greater influence over the government, potentially restricting the spending of congressionally approved funds in ways that could lead to legal challenges and court interventions. Previous administrations valued having independent regulators who could operate in the country's long-term interests without being swayed by daily political dynamics.
The Trump administration argues that independent regulators could hinder the president's agenda and the will of the electorate. The order has sparked criticism from some quarters, with concerns raised about potential politicization and corruption of independent agencies.
Independent regulatory agencies have a long history dating back to the late 19th century, with the creation of the Interstate Commerce Commission. The executive order signed by Trump goes beyond existing requirements for regulatory review and aims to reduce the independence of these agencies.
While the order covers the regulatory responsibilities of the Federal Reserve, it specifically maintains the Fed's independence in setting short-term interest rates. The practical impact of the order may be limited in the short term, but it represents a significant shift in the interaction between the Fed and the White House.
The order also outlines that the White House Office of Management and Budget will set performance standards and management objectives for heads of independent agencies, potentially altering funding based on alignment with the president's agenda. Special liaisons will be appointed to facilitate coordination between independent agencies and the White House.
Overall, the executive order signed by President Trump marks a notable development in the relationship between the White House and independent federal regulators, with potential implications for the future of regulatory oversight in the United States.
