There is no justification for revoking the fuel economy waiver now — no particular crisis facing automakers.
Earlier this week, Bloomberg broke the news that the Trump administration plans to press ahead on its plans to roll back the new national fuel economy standards established under President Obama and to freeze standards at current levels through 2030.
That’s not all. The White House also plans to try to nullify the waiver California has under the Clean Air Act to set its own standards — effectively forcing the state, and the dozen states that have aligned their standards with it, to roll back their standards back as well.
This is the most aggressive position the administration could possibly take, which seems to be its default mode. If successful, the plan would wipe out one of Obama’s biggest accomplishments on both air pollution and greenhouse gases. As I described in more detail in this post, the fuel economy of the US fleet would virtually stagnate through 2030. And according to new research from Energy Innovation, it would cost American consumers hundreds of billions of dollars.
— Energy Innovation (@EnergyInnovLLC) July 24, 2018
That’s if the plan succeeds, which is far from certain. As Brad Plumer explained last year for Vox, the standards can’t simply be scrapped. The underlying law requires some sort of regulation.
So the administration will need to replace the rule, and in the process, it will need to justify to a court why it did so. This requires explaining why Obama’s standards, which were developed in a long, intensive, collaborative effort with automakers and environmentalists, are prohibitively strict. “It’s not an easy case to make,” Bob Sussman, a top lawyer at EPA under Obama, told Plumer. “It’s very fact-intensive and highly technical.”
The difficulty is compounded many times over by the battle against California. The state has been enjoying its waiver for 48 years. There is no justification for revoking it now, no particular crisis facing automakers. But with Trump packing federal courts and now dominating the Supreme Court, there’s no telling what sort of novel legal arguments might find purchase. (See UCLA law professor Ann Carlson for some close legal analysis of the case.)
But this move by Trump, which he is undertaking without a peep of protest from the Republican party, makes a mockery of two principles that conservatives have long held up as guiding lights in their regulatory policy.
Federalism when it is helpful to conservative ends
The first is federalism — the principle, enshrined in the Constitution, that federal powers are limited and that states are left the powers not given the feds. Republicans have famously appealed to this principle when attempting to stop federal laws that might protect the poor and disadvantaged, most notably to fight desegregation. It was the basis of conservative objections to Obamacare, which would have (prior to the Sebelius case before the Supreme Court) forced states to expand Medicaid.
Or to choose a more recent and germane example, disgraced ex-EPA administrator Scott Pruitt was instrumental in loosening Obama-era rules on the disposal of toxic coal ash, allowing states and utilities to set their own standards. The Washington Post reported:
EPA Administrator Scott Pruitt said in a statement that the changes, which are estimated to save companies between $32 million and $100 million in annual compliance costs, underscore the administration’s commitment to federalism.
“Today’s coal ash proposal embodies EPA’s commitment to our state partners by providing them with the ability to incorporate flexibilities into their coal ash permit programs based on the needs of their states,” Pruitt said.
When states want to pollute more, the Trump administration argues for the need for flexibility.
If, as in California’s case, they want to pollute less, well, it’s time for a little federal discipline. So the administration is setting out to shut down California’s pioneering fuel economy standards, one of the most successful and longstanding examples of federalism in national policy. (See also: “federal overreach.”)
Regulatory certainty, only the opposite
The second is “regulatory certainty,” the oft-cited goal of giving US businesses a stable, predictable regulatory environment, so that they can make long-term investments. Before he was canned (which left him “devastated,” if you’re in the market for schadenfreude), Pruitt frequently used the language of certainty.
“Regulators exist to give certainty to those that they regulate,” he said in his very first address to EPA staff. “Those that we regulate ought to know what’s expected of them so that they can plan, and allocate resources to comply. That’s really the job of a regulator.”
Putting aside whether regulatory certainty is the primary reason regulators exist — something about the common good? public health? — it is rendered absurd by Pruitt’s behavior as administrator, which new interim administrator Andrew Wheeler is widely expect to continue.
As Michael Grunwald wrote in Politico last year, pronouncements of Pruitt’s success are premature. Every single change that’s been made to Obama EPA regulations is going to be litigated. Pruitt set in motion legal battles that will keep lawyers employed for years to come, but until those battles are resolved, the regulated entities, which once knew what they faced, don’t.
They are, in a word, uncertain.
Take the auto companies. They practically begged Trump not to freeze fuel economy standards. A merely weakened standard would have looked like a compromise and might have lasted. A freeze sets up an absurd situation that the next administration is almost certain to change radically.
Plus, if California and its dozen partner states are still able to impose their own standards, automakers could see the national market effectively split in two, one demanding more fuel-efficient vehicles than the other, which is a nightmare for manufacturers. The only way to avoid that fate is for the feds to defeat California in the coming legal battle. But California is confident it will win and, short of a Federalist Society judge getting the case, the odds are not in Trump’s favor.
So automakers — and all the companies in their supply chains — are stuck waiting and wondering what kind of vehicles they will be called upon to produce. The shape of the future US auto market, and their ability to make long-term investments, has never been less certain.
US conservatives are ideologically opposed to regulation
It could be argued that there is no point in identifying violations of principle by the Trump administration — it has long since proven itself committed to nothing beyond ethnonationalism and the reversal of everything Obama did. Neither administration officials nor their enablers are going to be moved by appealing to principle at this point. That ship has sailed.
But it is important to state clearly two important facts that are illuminated (yet again) by this latest Trump administration move.
First, while Trump is a bizarre and unprecedented character, the deregulatory agenda his administration is pursuing is widely supported by the GOP. The blunderbuss fashion in which Trump appointees have attacked and reversed federal regulations has elicited not a peep of protest anywhere in the conservative coalition. Trump is historically popular for a Republican president (though he is not particularly popular overall). Republicans like and support what he is doing, including heedless deregulation.
Second, the GOP is not only practically (by virtue of their funding) but ideologically opposed to federal regulation. As political scientists Matthew Grossmann and David Hopkins have shown, “the Republican Party is dominated by ideologues who are committed to small-government principles, while Democrats represent a coalition of social groups seeking public policies that favor their particular interests.”
US conservatives want less regulation. Arguments about whether a regulation’s costs exceed its benefits, whether or not it creates “certainty,” whether or not it abrogates “state’s rights,” or whether or not the regulated companies want it are used the same way conservatives use arguments about the deficit — situationally, to block Democratic initiatives. Republicans are never restrained by those principles themselves. Their commitment is to deregulation itself, regardless of context or circumstances.
Every claim of federalism, uncertainty, etc., is met with new credulity by the press. It launches dozens of earnest white papers from liberal groups. It would be nice if everyone remembered, next time around, that these justifications are utterly opportunistic, offered in bad faith, and there’s no obligation to pretend otherwise.
Any Republican administration will deregulate to the extent it is able, until stopped by political or legal force.
Author: David Roberts