President Donald Trump has signed an executive order that significantly reshapes the relationship between independent regulatory agencies and the executive branch. This order mandates that major regulators, including the Securities and Exchange Commission (SEC) and the Federal Trade Commission (FTC), report their new policy priorities to the White House for approval. The move grants the executive branch influence over these agencies’ budgets and aligns with Trump’s campaign promises to make independent agencies accountable to the president.
The administration has argued its authority to refuse spending funds allocated by Congress, challenging the Impoundment Act of 1974. This Act explicitly prohibits such actions, marking a contentious point in the ongoing debate over presidential powers. The order is part of Trump's broader push to expand or assert powers traditionally kept out of the president's hands, reflecting a fundamental shift in how the US government operates.
"Under the [executive order], independent agencies’ rules would be approved by OMB and Vought, their funding would be determined by OMB and Vought, and they would be required to follow White House policy dictates." – Robert Weissman
Russell Vought, head of the Office of Management and Budget (OMB), now holds oversight over a suite of major agencies, including those regulating Wall Street, campaign finance, telecommunications companies, labor, and the Postal Service. The executive order also extends to the Federal Reserve but exempts its authority over monetary policy.
"The Order directs that all independent agencies shall subordinate themselves to the office of management and budget (OMB) and Trump’s OMB hatchet man, Russ Vought." – Robert Weissman
This move aligns with the unitary executive theory, a fringe legal premise suggesting that the US president has sole power over the entire executive branch. Daniel Schuman, executive director of the American Governance Institute transparency group, highlights a long-standing strain within the Republican party to advance this theory.
"There has been a long strain within Republicans to advance the unitary executive theory, which is basically that the president is a king and can do whatever they want." – Daniel Schuman
The impact of this order is profound. Agencies like the SEC and FTC currently have ongoing investigations or enforcement actions against companies owned by Elon Musk. Critics argue that such centralized control could compromise the independence necessary for fair and impartial regulation.
"Not incidentally, both the FTC and SEC have ongoing investigations or enforcement actions against companies owned by Elon Musk." – Robert Weissman
Legal experts are scrutinizing this development, with significant pushback coming from the courts, the third co-equal branch of government. Lawsuits are already challenging various aspects of the Trump administration's approach to governance, including the summary firing of independent watchdogs and attempts to end birthright citizenship.
"What we’re trying to do is identify the pockets of independence and seize them." – Russell Vought
The administration has previously attempted other controversial initiatives, such as dismantling USAid, which underscores its broader strategy of consolidating power within the executive branch.