While it’s not yet commonly acknowledged, in a government with as hefty a gravitational pull as ours, federal spending is also federal regulation.
That’s why deregulation—when it does happen—can sometimes emerge from surprising places. A new executive order from Donald Trump may fit that bill, perhaps even more significantly than his earlier “one-in, ten-out” directive.
The COVID-19 pandemic five years ago exposed serious vulnerabilities in our national preparedness, revealing a troubling reliance—by virtually everyone and everything—on federal intervention during crises. The resulting surge in federal spending (and its attached regulatory strings) tends never to recede. This year, the Congressional Budget Office projects a $1.9 trillion deficit on $7 trillion in spending—even in the absence of an emergency.
Back then, I argued for an “Abuse-of-Crisis Prevention Act” (AOC Prevention) to curb the predatory exploitation of emergencies for political gain and to foster resilience at all levels of society before the next economic shock. The core idea was simple: instead of funneling trillions into reactive federal rescues, we should prioritize policies that empower individuals, businesses, and states to weather shocks independently. Pertinent now thanks to a new Trump executive order, two sections in particular (Titles IV and V, noted below) called for getting the federal government out of crisis response best left to states and localities.
Today, that vision aligns with a new Donald Trump initiative to shift responsibility back to the states, as seen in Executive Order 14239, titled “Achieving Efficiency Through State and Local Preparedness.” (Here’s a “Fact Sheet.”) The order reads in part:
Federal policy must rightly recognize that preparedness is most effectively owned and managed at the State, local, and even individual levels, supported by a competent, accessible, and efficient Federal Government. Citizens are the immediate beneficiaries of sound local decisions and investments designed to address risks…. When States are empowered to make smart infrastructure choices, taxpayers benefit. This order empowers State, local, and individual preparedness and injects common sense into infrastructure prioritization and strategic investments through risk-informed decisions that make our infrastructure, communities, and economy resilient to global and dynamic threats and hazards.
The 2020 CARES Act (Coronavirus Aid, Relief, and Economic Security Act) and the 2021 American Rescue Plan Act (with its $1.9 trillion price tag) exemplified the problem that the new order can help correct. States were funded regardless of their lockdown choices; inefficiencies were rewarded; and worst of all, the idea of universal basic income (UBI)—which erodes self-reliance—gained dangerous legitimacy.
Rather than learning from the pandemic (and 9/11, and the 2008 financial meltdown) to build resilience, the federal government’s instinct remains to double down on dependence. We remain vulnerable to another round of runaway deficit spending as soon as the next shock hits.
Along with ending states’ reliance on federal handouts during non-crisis times, my earlier call for reform emphasized several related pillars for fostering a culture of preparedness—and reducing the need for massive, knee-jerk federal flash-policy responses. Among them:
- Rethinking (and banning) emergency declarations to avoid moral hazard,
- De-tax and deregulatory policies to enable rainy-day funds for households and businesses,
- Liberalizing crisis-insurance markets,
Trump’s Executive Order 14239, while not explicitly aimed at universal economic shocks (it highlights cyberattacks, wildfires, hurricanes, and “space weather”), nonetheless reflects this same philosophy, pursuing a norm of states taking the lead in disaster preparedness and infrastructure resilience.
It’s an important conversation starter—especially in this era of rethinking supply chains from every angle. E.O. 14239 mandates a National Resilience Strategy within 90 days, aiming to streamline federal policy and prioritize risk-informed state, local, community, and individual decisions over blanket federal interventions. This shift could support broader moves to reduce the strings-attached federal grants-in-aid—already nearing $1 trillion pre-COVID—and help pave the way for eventually phasing out federal private aid altogether.
Of course, challenges remain. States vary in capacity, and without clear guidance on decoupling from federal funding, some may struggle or fail to engage in the balancing acts required. Still, the order’s directive for FEMA to “review all national preparedness and response policies” is a vital step toward a system in which crises don’t automatically trigger trillion-dollar bailouts.
By fostering state-level resilience, we can preserve limited government and shield future generations from the debt and dependency that crisis exploitation inevitably breeds. Trump’s order represents one important piece of a broader Abuse-of-Crisis Prevention Act. Executive action alone won’t solve the problem—legislation will be necessary—but here’s to letting the next crisis go to waste.
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
“The Best American Rescue Plan Is An “Abuse-Of-Crisis Prevention Act,” Forbes
“A Constitutional Amendment Banning Subsidies, Grants And Loan Guarantees,” Forbes
