Trump's Order Slashes $1 Trillion Government Red Tape to Empower Small Businesses

The federal government spends nearly $1 trillion annually on goods and services, yet the process governing these purchases has become a labyrinth of inefficiency. For decades, the Federal Acquisition Regulation, sprawling across 2,000 pages, has choked businesses with red tape, favoring entrenched vendors while stifling competition. President Trump’s recent executive order, 'Restoring Common Sense to Federal Procurement,' delivers a long-overdue reckoning. This isn’t just reform; it’s a revolution aimed at dismantling bureaucratic barriers and unleashing American enterprise.

The order mandates a 180-day sprint to streamline the FAR, preserving only what’s required by law or critical for effective procurement. Non-essential rules face a sunset clause, expiring after four years unless explicitly renewed. This bold move signals a clear intent: government must serve taxpayers, not suffocate the businesses it relies on. By prioritizing commercial products and slashing paperwork, the administration is opening doors for new players, particularly small businesses, to compete in a market long dominated by a select few.

The FAR’s complexity isn’t an accident; it’s the product of decades of unchecked regulatory growth. Since its inception in 1984, the regulation has ballooned, layering statutory mandates with discretionary rules that often serve narrow interests. The result? A system where compliance costs eat up 3-5% of small businesses’ revenue, discouraging new entrants and entrenching corporate giants. From 2005 to 2019, new small business participation in federal contracting plummeted by 79%, a stark indictment of a process that’s anything but fair.

Advocates for the old system, often entrenched bureaucrats and their allies in big business, argue that complex rules ensure accountability and advance social goals like diversity or environmental sustainability. But their logic falters under scrutiny. Piling on requirements for ESG criteria or climate-related mandates doesn’t guarantee better outcomes; it just raises costs and excludes smaller firms that lack the resources to navigate the maze. The Trump administration’s approach—focusing on efficiency and competition—exposes this for what it is: a pretext for preserving a broken status quo.

Small businesses are the backbone of the American economy, yet they’ve been sidelined in federal contracting for too long. The administration’s reforms directly address this, building on existing Small Business Administration programs that reserve 23% of contract dollars for small firms. By reducing paperwork and emphasizing commercial buying, the order makes it easier for these companies to compete. Recent SBA proposals, like expanding the 'Rule of Two' to ensure set-asides when two qualified small businesses can bid, could inject an additional $6 billion annually into small business contracts.

This isn’t just about economics; it’s about fairness. When a small tech startup or family-owned manufacturer faces fewer hoops to jump through, it’s not just their bottom line that benefits—it’s their communities, their employees, and the broader economy. The administration’s focus on agility and cost-effectiveness aligns with the Section 809 Panel’s recommendations for streamlining defense acquisitions, proving that smart policy can deliver real-world results without sacrificing accountability.

The procurement overhaul is part of a broader deregulatory agenda that’s reshaping how Washington operates. The '10-for-1' rule, requiring agencies to repeal ten regulations for every new one, sets a high bar for bureaucratic excess. By targeting rules on diversity, climate, and contractor minimum wages, the administration is peeling away layers of ideological baggage that have little to do with getting taxpayers the best value. These changes, coordinated with the Department of Government Efficiency, prioritize what matters: delivering goods and services effectively, not advancing social engineering.

Opponents, particularly those invested in expanding government’s role in social and environmental policy, claim these rollbacks undermine progress. Their argument hinges on the idea that procurement should serve as a tool for broader societal goals. But this misses the point. Federal contracting isn’t a charity or a policy lab; it’s a business transaction meant to serve the public efficiently. Forcing contractors to comply with ever-shifting ESG standards or climate rules only inflates costs and distracts from the core mission.

The sunset clause is perhaps the most radical element of Trump’s reform. By forcing non-statutory rules to justify their existence every four years, the administration is institutionalizing accountability. This isn’t a one-off fix; it’s a structural shift designed to prevent the FAR from creeping back into unmanageable territory. Coupled with the emphasis on commercial solutions, it creates a procurement system that’s leaner, more competitive, and responsive to the needs of a dynamic economy.

Historical precedent supports this approach. The deregulatory waves of the Carter and Reagan eras, from airlines to telecommunications, unleashed innovation and growth by trusting markets over mandarins. Today’s reforms echo that spirit, betting on American businesses to deliver when given the freedom to compete. While regulatory uncertainty may challenge agencies and contractors in the short term, the long-term payoff—lower costs, broader participation, and a more vibrant federal marketplace—is worth it.

President Trump’s procurement overhaul is a decisive step toward a government that works for its people, not against them. By slashing red tape, empowering small businesses, and prioritizing efficiency, these reforms promise to transform a $1 trillion market into a beacon of opportunity. The message is clear: American enterprise, not bureaucratic inertia, will drive the future of federal contracting.

As agencies race to meet the 180-day deadline, the nation watches. This isn’t just about rewriting rules; it’s about restoring trust in a system that’s been bogged down for too long. With a focus on competition and fairness, the administration is proving that government can be a partner to progress, not an obstacle. The era of bloated regulations is over, and a new day for American business has begun.