The Historic Deregulatory Moment: Trump, CPAC, and the Massive Economic Opportunity Ahead

A New Milestone in Deregulation

In an era where the size and scope of the federal government have ballooned largely through unchecked regulatory expansion, we are witnessing a historic reversal. Earlier this month, Wayne Crews of the Competitive Enterprise Institute (CEI), published a piece in Forbes that may have been missed in the clutter of headlines, but its implications are staggering.

According to Crews, the Trump administration’s mid-year tally of new federal rules is at the lowest level ever recorded. In a world where the "hidden tax" of regulation usually grows relentlessly, this mid-2025 snapshot marks an unprecedented rollback. Under President Trump’s aggressive "one-in, ten-out" policy, we are not merely slowing regulatory growth — we are actively dismantling the labyrinth of federal dictates that have long strangled innovation, job creation, and economic mobility.

This is a profound vindication of the work regulatory reform advocates have done over decades, meticulously cataloging the immense cost of the regulatory state. It is also a signal moment for the mission of the CPAC Foundation's Center for Regulatory Freedom (CRF), which has championed deregulatory reform and accountability measures like the REINS Act for years.

But to truly grasp what this means, we must look beyond the count of rules and pages in the Federal Register. We need to examine what these reductions mean in hard dollars — both in the direct costs avoided and, more importantly, the enormous opportunity costs recaptured.

The "Unseen" Tax of Regulation

Groups like CEI, CPAC's CRF, and others have been consistently shining a light on the sheer scale of the administrative state. CEI's annual Ten Thousand Commandments report is the gold standard for measuring the scope and burden of federal regulation. In that report, Crews typically documents that federal regulation imposes an annual hidden tax on the U.S. economy amounting to trillions of dollars.

In his recent Forbes piece, Crews highlights a turning point: the number of new rules coming out of Washington under the Trump administration has dropped to historic lows. This isn’t just a footnote; it is a sign that the tide may finally be turning against the regulatory status quo that has metastasized for over a century.

Under previous administrations, the flow of regulation was more or less taken for granted. Even administrations that spoke of "cutting red tape" rarely managed to slow the flood. The Trump approach, particularly in this second term, appears fundamentally different. As Crews details, the administration's commitment to a "one-in, ten-out" regime has effectively reversed the long-standing trajectory of constant regulatory expansion.

Crews' work puts hard numbers on what too often remains abstract. Regulatory costs don’t show up on a receipt, but they hit every household through higher prices, fewer jobs, and slower wage growth. As CEI's research tirelessly points out, this is a stealth tax that rivals, and sometimes exceeds, the cost of the income tax.

Patrick McLaughlin, the Opportunity Cost of Regulation, and the True Prize

Moreover, Crews' estimates of direct compliance costs — vast as they are — tell only part of the story. The truly staggering figure comes from what Dr. Patrick McLaughlin has called the "opportunity cost" of regulatory accumulation. As McLaughlin has testified before Congress and demonstrated through rigorous econometric research, the accumulation of federal regulations over decades hasn’t merely added paperwork costs. It has fundamentally altered business investment decisions, slowed productivity growth, and thereby shrunk the entire U.S. economy.

According to McLaughlin’s study published in the Review of Economic Dynamics, regulatory accumulation has slowed the U.S. GDP growth rate by about 0.8 percentage points annually, leading to an economy that was $4 trillion smaller by 2012 than it otherwise would have been. In simpler terms, regulations over past decades have cumulatively sliced off about 25% of the economy we could have had.

This means the opportunity cost multiplier of regulations is enormous. Every dollar avoided in direct regulatory cost potentially unlocks $2, $3, or more in economic output that would otherwise be lost to misallocation and drag. Compared to compliance paperwork, these long-term productivity impacts are the true economic killer.

What Trump’s Accelerated Deregulation Means in Hard Numbers

Returning to the present: the Trump administration’s unprecedented record-low flow of new rules means that the cost of regulation is likely to decline at an accelerated pace compared to the first term.

During Trump’s first term, direct regulatory costs declined by an estimated 6.5% to 8.4% over four years, according to research we at CRF have tracked. That amounted to annual declines of roughly 1.7% to 2.2%, modest by historical standards but still the first meaningful rollback in regulatory costs in living memory.

In this second term, however, the pace appears even more aggressive. If this continues, it is plausible we could see cumulative reductions in direct regulatory costs of 13% to 17% by the end of the term in 2029.

Let’s put this into dollars:

• Baseline regulatory cost at start of second term (2025): $4 trillion

• Reduction range by 2029:

  • 13% decline: saves ~$520 billion

  • 17% decline: saves ~$680 billion

    
    

Even at the low end, that is over half a trillion dollars freed from direct regulatory drag.

The Larger Prize: Regained Economic Opportunity

But using Patrick McLaughlin’s conservative multiplier of 2.2 (reflecting how avoiding direct regulatory burdens compounds into higher GDP through restored investment and productivity), these savings translate into truly enormous economic opportunity:

• $520 billion in direct savings x 2.2 = ~$1.15 trillion in regained GDP

• $680 billion in direct savings x 2.2 = ~$1.5 trillion in regained GDP

This means that by the end of 2029, the Trump regulatory rollback could leave the U.S. economy $1.1 trillion to $1.5 trillion larger than it would be under a regime of continued accumulation.

This isn’t just a boon for Wall Street or large corporations. As McLaughlin’s research repeatedly underscores, regulatory burdens disproportionately crush small businesses and startups — the very engines of job creation and upward mobility. Likewise, lower-income households pay a steeper share of their income on regulated necessities like energy, food, and healthcare. Deregulation thus amounts to a massive pro-growth, pro-worker, and pro-consumer policy.

Why This Matters to the Mission of the Center for Regulatory Freedom

The CPAC Foundation’s Center for Regulatory Freedom has argued that the regulatory state represents the most stealthy and least democratically accountable expansion of government power. Unlike taxes passed by elected representatives, regulations are often drafted by unelected bureaucrats, insulated from voters, yet they carry the full force of law.

We have long championed reforms such as the REINS Act, which would require Congress to approve major new rules, and have advocated for rigorous retrospective review to prune the overgrown regulatory code. We have also worked alongside partners like CEI to push for better measurement of regulatory impacts, so the American people understand the true cost.

What we are witnessing under the Trump administration is precisely the kind of course correction we have fought for. A regulatory state that stops growing uncontrollably — and even shrinks — represents a monumental restoration of economic freedom. It also reduces the hidden tax that has hollowed out wages, investment, and innovation for decades.

Looking Ahead: Consolidating the Gains and Going Further

This is no time for complacency. The history of the administrative state teaches us that regulatory creep is relentless. Without institutional reforms like the REINS Act or stronger regulatory budget caps, the regulatory machinery will start to grind forward again the moment vigilance lapses.

Moreover, as McLaughlin has shown, even small reductions in regulatory drag can produce outsized gains in long-term GDP growth. This is because restoring freedom to invest, hire, and innovate pays dividends that compound year after year. It is also why Idaho, after cutting its regulatory burden by over 50%, now outpaces national economic growth averages and has become a magnet for new businesses.

The Trump administration’s record low rule counts are a clarion call that aggressive regulatory rollback is not only possible, but massively beneficial. If paired with structural reforms that institutionalize restraint, the U.S. could usher in a multi-decade growth renaissance, delivering prosperity across all income levels.

America’s economic future doesn’t have to be one of managed decline under an ever-expanding administrative state. With sustained vigilance and the right policy frameworks, we can continue to pare back the regulatory thicket, unleashing the same entrepreneurial energy that built this nation into the most dynamic economy the world has ever seen.

That is why the CPAC Foundation's Center for Regulatory Freedom will keep fighting to hold regulators accountable, to demand rigorous cost analysis, and to champion reforms that ensure the administrative state serves the people — not the other way around.