- President Donald Trump and Republicans have so far failed to pass large-scale bills to undo former President Barack Obama’s legislative achievements, such as Obamacare.
- But Trump and the GOP have found ways to chip away at Obama’s legacy.
- Most recently, that came in the form of the Wall Street deregulation bill passed Tuesday.
- It eliminates some – but not all – of the Dodd-Frank Act’s banking rules.
- Trump and Republicans have also used regulatory actions to shape the healthcare system and other federal agencies.
Congress’ passage Tuesday of the first major rollback of Wall Street regulations enacted after the financial crisis are set to not only reshape the financial system, but also serve as the latest Republican blow in a bid to unwind former President Barack Obama’s legacy.
The bill, which President Donald Trump says he will sign, does not undo the post-crisis banking regulation Dodd-Frank Act completely. But it is set to roll back many of the rules and regulations that came to define Obama’s relationship to Wall Street.
Sen. Mitch McConnell, the majority leader, said the legislation would give “smaller community lenders relief from Obama-era overregulation.”
“I frequently discuss how our Democratic colleagues’ top-down policy agenda worked well for a select few urban areas but left much of the rest of the nation behind. This issue is a perfect illustration of that,” he said.
But at the margins, the Trump administration and GOP lawmakers have managed to chip away at some of the former president’s signature accomplishments.
Trump attacks Obama’s agenda on all fronts
Trump has undertaken extensive reversal to his predecessor’s legacy through executive order. Most significantly, he has done so by pulling the the US out of the Iran nuclear deal, the Paris climate agreement, the Trans-Pacific Partnership, three major, multilateral deals.
But Congress and the administration have also used other parliamentary and regulatory tactics to slowly but surely hack away at the former president’s policy achievements.
Republicans also slipped a monumental Obamacare change into their recently implemented tax bill. Starting next year, individuals will no longer face the law’s individual mandate – the rule that requires all American get health coverage or face a fine.
While the mandate will allow some people to avoid paying the penalty, the Congressional Budget Office estimated the repeal will result in 13 million more Americans going uninsured by 2027 compared to the current system.
The Trump administration has also worked to reshape healthcare rules on the state and national level:
- The Department of Health and Human Services has been aggressive in approving waivers that allow states to make modifications to Medicaid programs and insurance market regulations.
- These waivers are designed to help states bring down costs for consumers, but the waivers granted so far also undermine some of Obamacare’s regulations for health plans and possibly reduce the number of poor Americans on Medicaid.
- On the national level, the department is set to roll out an expansion of short-term health plans that could allow insurers to dodge some of the healthcare law’s key protections.
- These plans are not subject to the same regulatory scrutiny as long-term plans, making them a cheaper but much less generous option. Healthy policy analysts warn that people on these plans could be subject to higher costs in the event of illness and the expanded use of short-term plans will undermine the main Obamacare market.
Other agencies, such as the Environmental Protection Agency, Department of the Interior, and Department of Housing and Urban Development are making similar rule changes to reverse Obama-era practices.
Congress uses an unusual route to chip away
In Congress, Republicans have also made use of the Congressional Review Act, which allows lawmakers to rescind regulations put in place by executive agencies. Recently, Republicans also tried an unused wrinkle to the CRA, which could allow Congress to rescind regulations dating back to the CRA’s passage in 1996.
Previously, the CRA was thought to only apply to regulations that were created within the past 60 days. But, the GOP pointed a small provision that says the CRA can be used for up to 60 days after a regulation is submitted to Congress. Since many regulations were not submitted, Republicans have argued they have even more leeway to continue to undo Obama’s executive actions and regulations with very little effort.
Republicans were able to block a 2013 rule from the Consumer Financial Protection Bureau that attempted to prevent racial discrimination in auto lending. More could be on the way.
“By setting this terrible precedent of repealing regulatory guidance, the majority is opening up a Pandora’s Box that could have deeply harmful consequences for the public and badly impede the important work of regulators not just of the financial services industry, but of all industries,” Rep. Maxine Waters, the top Democrat on the House Financial Services Committee, said at the time.