Industry Voices

Barry’s Pickings Online – Post-Election Thoughts

Will the Trump administration repeal the DOL’s fiduciary rule, and is comprehensive tax reform possible?

By PS | November 10, 2016
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PS_Barry_JCiardielloArt by Joseph CiardielloDilbert says – Change is good. You change first. 

The right analogue is Obama in 2009: when he takes office, President Trump will have the advantage of Republican control of both houses of Congress. That means that he and the Republican leadership will be able to move legislation in a way that was impossible for either party during the last six years of divided government.

Also: much of the policy made by the Obama Administration during the last six years was made solely on executive authority. Depending on how far President-elect Trump and his Administration are prepared to go, they can reverse much of that.

What does that mean? I’ve got three really big questions.

Will a new Trump Administration repeal the Department of Labor’s (DOL)’s controversial Conflict of Interest rule? Maybe.

In a memorandum issued January 20, 2009, President Obama’s (then) Chief of Staff Rahm Emanuel instructed all agencies that no proposed or final regulation be sent to the Office of the Federal Register for publication “unless and until it has been reviewed and approved by a department or agency head appointed or designated by the President after noon on January 20, 2009.”

The (Bush) DOL had finalized guidance on investment advice on January 16, 2009. That final rule was not, however, published in the Federal Register until January 21, 2009. So—in line with Mr. Emanuel’s instruction (sort of)—the new (Obama) DOL extended the effective date of the advice regulation for 60 days and re-opened the comment period.

DOL’s ultra-controversial conflict of interest rule is “final” and has been published in the Federal Register. But it’s not effective until April 2017. It’s entirely conceivable that a new (Trump) DOL could extend the effective date of that regulation, re-open the regulatory process and, perhaps, as many in Congress have suggested, get the Securities and Exchange Commission (SEC) involved.

At a less spectacular level, there are a host of regulatory issues before the Obama DOL that may be treated in a significantly different way by a Trump DOL, including: electronic participant communications, state plans and open multiple employer plans (MEPs) and the defined contribution (DC) plan annuity safe harbor.

NEXT: Tax reform and paying for infrastructure spending

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