The regulatory-budget experiment has run long enough to grade. Executive Order 13771, signed in January 2017, required agencies eliminating two regulatory costs for every new cost imposed, with incremental-cost caps set by the Office of Management and Budget; the United Kingdom ran a similar one-in, three-out policy from 2010, and both became the model for statutory proposals in Congress. The measured results split cleanly by timescale. In year one, the U.S. rule count fell dramatically — the 2017 unified-agenda data showed agencies finalizing far fewer significant rules than any recent prior year, and the administration claimed multibillion-dollar regulatory-cost savings. Beyond year one, the reduction faded: rulemaking volumes rebounded toward historical norms in later years, and the cost accounting behind the savings estimates drew sustained methodological criticism.
What the evidence shows
Three findings hold up across the Government Accountability Office's retrospective, academic evaluations, and the administrative-law literature. First, the instrument shifted rulemaking from significant rules to actions below the significant threshold — guidance documents, interpretive rules, and direct-final actions — some of which moved because they avoided the budget accounting, a substitution effect critics documented in detail. Second, the offset arithmetic was soft: agencies claimed savings from deregulatory actions whose baseline valuations were contestable — savings from delaying or withdrawing a rule are measured against a counterfactual that never happened, and the Office of Information and Regulatory Affairs's own analyses carry wide uncertainty bands that the headline totals omitted. Third, durability failed: a regulatory budget built on executive order lasts exactly as long as the next executive order, and the mechanism was rescinded and reinstated with administrations — unlike the Congressional Review Act, which is statute and produced the durable record: 22 rules permanently repealed in 2025.
Why the UK comparison matters
The British experience is the longest-running dataset and lands in the same place. The one-in, three-out rule and business-impact-target demonstrably changed agency behavior — departments game-kept their regulatory balance sheets, and some genuinely deregulated. But evaluations, including the OECD's regulatory-policy reviews of the UK, found the metric drove avoidance behavior: measures reclassified out of scope, burden definitions adjusted, and genuine regulatory needs deferred to stay inside the target. The lesson both countries teach: a cost cap changes accounting behavior reliably, and rulemaking behavior only at the margin, because most major rules are statutory commands Congress has already ordered agencies to execute.
The statutory constraint, stated plainly
The binding limit on any regulatory budget is that agencies do not volunteer most rules — statutes do. Deadlines and mandates in environmental, financial, and safety law force action regardless of an executive order's accounting; deferring a statutory deadline invites litigation from whoever wants the rule, a pattern that ran through every administration's attempts at cost control. The durable versions of the idea in Congress — regulatory budget statutes passed by one chamber in some sessions but never enacted into law — would have the same collision, just with harder legal fights.
FAQ
What was Executive Order 13771?
The 2017 two-for-one order: for every new regulatory cost, agencies had to eliminate two, under incremental-cost caps set by OMB — rescinded and reinstated with successive administrations.
Did it reduce regulation?
Rule counts fell sharply in year one, then rebounded; claimed savings rest on contestable counterfactuals, and substitution into non-significant actions blunted the effect.
Why can't a regulatory budget be permanent?
Executive-order budgets expire with administrations, and statutory rulemaking mandates — Congress's deadlines — sit outside any executive accounting cap.
For more context, read Unfunded Mandates: When Washington Bills the States.
For more context, read Why State Unemployment Systems Can't Finish Modernizing.
For more context, read evidence act.