Trump Reforms Die Without An Abuse-Of-Crisis Prevention Act

Amid frustrations with interventionist elements of the Trump agenda—such as tariffs and revived antitrust zeal—many have nevertheless been encouraged by the renewed push for deregulation under the administration’s second incarnation. Executive actions targeting bureaucratic sprawl, agency guidance abuse and taxpayer funding of left-wing causes mark a welcome return to limiting government’s reach.

But let’s not kid ourselves. Even in the best political circumstances, a single crisis can undo it all.

When the next economic shock or national emergency inevitably strikes, any GOP victories in trimming back the regulatory state will prove fleeting—unless the administration and Congress prepare for and preclude what otherwise reliably follows: permanent government expansion, both on the spending and regulatory fronts.

The COVID-19 pandemic marked the third major 21st-century shock—after 9/11 and the 2008 financial crisis. In each case, Washington seized the moment to entrench hyper-spending and regulation through newly minted powers, agencies and social programs.

Both parties are complicit. Republicans who supported unprecedented pandemic-era deficit spending and eviction moratoria later lined up behind Joe Biden’s infrastructure and technology spending campaigns, deepening the cycle of crisis-driven expansion.

A new Trump executive order aimed at restoring crisis-readiness at the state level—along with fresh efforts to manage procurement and slash government grants and contracts spanning education, climate initiatives, and nominally independent basic research—marks a critical move in the right direction. But executive action alone can’t unwind the machinery of crisis opportunism and political predation.

To break the shock-to-sprawl cycle, Congress should assemble and pass an Abuse-of-Crisis (AOC) Prevention Act—a legislative framework to curb political predation, block federal bailouts and institutionalize limits on government growth that endure through the next emergency.

Comprehensive Downsizing

The Trump administration has already reignited the deregulatory agenda with a flurry of executive actions targeting red tape and bureaucratic bloat. But to make lasting change, Congress must go further—beyond trimming—to the wholesale termination of entire departments, agencies and commissions by repealing their enabling statutes. That means replacing sprawling federal economic and social programs—and their thicket of rules—with privatization and the restoration of residual authority to states and communities.

This is where the Department of Government Efficiency (DOGE)—a Trump-era initiative—can also play a role. While not referenced in every executive order on deregulation, DOGE embodies the broader push to root out waste, eliminate redundancy, and streamline the executive branch as the only entity specifically “chartered” to do so. Congress should now codify DOGE—currently set to expire at America 250—and empower it or some variant as the institutional hub for agency elimination and structural reform, while also enacting the administration’s aggressive new regulatory sunsetting and other mechanisms.

Business Resilience

In advance of the next crisis, businesses must accumulate abundant rainy-day (and year) reserves to deter lobbyist-driven feeding frenzies, flash-policy bailouts, and disruptions to supply chains and employment. A critical step is reforming the Internal Revenue Service’s restrictive “reasonable needs” limits, which currently constrain how much businesses can set aside for operating expenses and retained earnings. We now know with certainty that reasonable needs include crisis-preparedness. A constitutional amendment may ultimately be required to ban the hundreds of billions in bailouts, subsidies, loan guarantees, and other cronyist supports that otherwise undermine true resilience in both good times and bad.

Foster Intergenerational Wealth

Policymakers must do more to enable household wealth-building across generations. This is urgent given the left’s ongoing push for universal basic income (UBI)—a policy likely just one crisis away, as previewed by the COVID-era Economic Impact Payments that sent direct cash to nearly every American household. Congress should promote emergency and retirement savings, empowering families to protect themselves from fiscal collapse. A federal government barely noticeable–as opposed to one consuming 30 percent of GDP–is the way forward. While current entitlements would be honored, younger generations should have the option to opt out, and lawmakers should ban the automatic enrollment of newborns into federal benefit programs.

Restore Federalism

Resilience at the state level may begin with Trump’s new directive, but to proceed it requires the termination of the hundreds of billions in annual federal grants-in-aid, allowing funds to remain in states from the outset. This shift restores state sovereignty, enabling local governments to serve their citizens without federal interference.

Emergency Powers Restraint

Congress must tightly limit emergency declarations and require affirmative reauthorization for any extensions. It should also liberalize and defederalize casualty insurance markets to promote private-sector readiness, reduce moral hazard, and eliminate the socialization of risk.

The time to erect permanent barriers against the progressive vision of a custodial administrative state—one that subsumes business, states, communities, and households—is now. The executive branch cannot do it alone, so policymakers should seize every legislative and political opening to implement reforms with lasting consequences.

By fostering self-reliance across sectors, an Abuse-of-Crisis Prevention Act can confront the root causes of both debt crises and hyper-regulation—protecting Americans from political opportunism both now and for generations to come.

For more see:

The Case for Letting Crises Go to Waste How an “Abuse-of-Crisis Prevention Act” Can Help Rein in Runaway Government Growth, Competitive Enterprise Institute

“A Constitutional Amendment Banning Subsidies, Grants And Loan Guarantees,” Forbes