A key response to the 2008 financial crisis was setting up a super-group of regulators to protect the economy from another disastrous crash. But in the Trump era, flagging new dangers has taken a backseat to cutting constraints on business.

The latest blow came Wednesday when the Financial Stability Oversight Council (FSOC) said it no long considered Prudential Financial Inc. so big and complex that the insurer's failure could trigger a panic.

Prudential was the last non-bank to carry the regulator's dreaded systemic-risk label, which brings tough oversight and steep compliance costs. When Congress created FSOC through the Dodd-Frank Act, many on Capitol Hill and Wall Street expected it to impose the tag on a number of hedge funds, private-equity firms, and insurers. Instead, the watchdog is retreating.