Donald Trump will gain more control over independent federal agencies (including important financial regulators) in the latest move by the U.S. president to master government agencies.
The White House said in a statement that the president signed an executive order late Tuesday, “re-rope in independent agencies”, ordering them to submit draft regulations for review.
Trump will also set "performance standards" for institutions and must "consult" the White House on "their priorities and strategic plans."
The order is an attempt by the president to close the regulators formed in federal regulations while trying to expand the power of the government's executive branch, while beating civil servants with measures to cut budgets and lay off employees.
According to a White House statement, the U.S. Constitution “gives all executive powers to the president, which means that all executive officials and employees are under his supervision.”
"Now, they will no longer impose rules on the American people without supervision or accountability," the White House said.
The order targets institutions including the Securities and Exchange Commission, the top regulator on Wall Street; the Federal Trade Commission, antitrust regulator; and the Federal Communications Commission, which conducts television, internet services and broadcasts in the United States.
According to the White House, the Federal Reserve's monetary policy function has been exempted from orders, but the central bank's supervisory position has become a target.
Critics argue that the order is illegal and that it is a core function that grants regulatory authorities power through legislation.
"It's a very dangerous idea for the health, safety, environment and economy of the country," said Robert Weissman, co-president of the consumer advocacy group Public Citizens. He added: "Congress makes independent institutions make Independent from the White House, there is good reason.”
He added that the “illegal” order “is intended to protect companies from accountability and to concentrate more power with Trump and his slaves.”
Former President Joe Biden has appointed the leadership of progressive regulators to strengthen supervision and law enforcement.
The Fed and the SEC declined to comment; the FTC and the FCC did not immediately respond to requests for comment.
According to a statement from the White House, the Office of Management and Budget will “adjust” the allocation of funds to federal agencies to ensure taxes are spent wisely.
It added that Trump and U.S. Attorney General Pam Bondi would “interpret the executive’s laws rather than letting separate agencies adopt conflicting interpretations” without elaborating further.
The statement appears to have caused the presidential latitude to undermine the independence of institutions while concentrating the power to establish laws during the presidency.
"This is the opening ceremony Salvo if you want," said Ed Al-Hussainy, interest rate analyst at Threadneedle Investments in Colombia. "We know what the executive wants to do here: bringing institutions on its track, with Congress setting up The mandate is in conflict with the provisions and there is enough open space for litigation around this lawsuit.”
Legal challenges targeting the order are broadly expected. "The White House and conservatives not only expect, but also want legal challenges to executive orders," according to a note by Ian Katz, a financial policy analyst at research firm Capital Alpha Partners.
Katz added: "They hope that the Supreme Court's ruling further consolidates the consolidation of the executive powers of the institutions."
Other reports by James Politi and Harriet Clarfelt