The Next Repeal and Replace
With Obamacare left in place for the time being, President Donald Trump is setting his sights on a different aspect of his predecessor’s legacy. A wide-ranging executive order on climate change, signed this afternoon, calls for rollbacks of a variety of Obama-era policies. Yes, repeal and replace is the phrase du jour in Washington, and it’s not going away anytime soon.
The heart of the Trump order pertains to the Clean Power Plan: federal regulations limiting emissions from new and existing coal-fired power plants. These rules formed the centerpiece of the Obama administration’s Climate Action Plan and directly challenged the survivability of the U.S. coal industry. Many coal allies expected the president to eliminate the regulations entirely, but he instead directs EPA to go back to the drawing board and rewrite these rules.
In many ways, this is the safest approach to take.
By suggesting a replacement, Trump would be letting down a key constituency on a longstanding campaign promise. Coal country expects nothing short of an aggressive deregulation crusade to bring down the costs of doing business and have a shot at resurrecting the industry.
But simply withdrawing the rules is also not an option, at least in the long run. A 2007 Supreme Court decision (Massachusetts v. EPA) held that the EPA had to address greenhouse-gas emissions under existing authorities provided those emissions are a threat to public health and welfare. In 2009, the EPA finalized the “endangerment finding,” a regulatory declaration that emissions of greenhouse gases directly contribute to factors that threaten the public. If the EPA fails to regulate greenhouse-gas emissions, the environmental movement has plenty of fodder for a successful lawsuit.
The order to “revise or rescind” delays the inevitable legal challenge by shifting the decision into the regulatory rulemaking process. That’s a slow-moving train; from its inception, the Clean Power Plan took the EPA about five years to finalize. Anticipate a similarly long, methodical consideration of how to move forward with plenty of consternation on all sides.
This is where the administration, coal supporters, and environmental activists get stuck. There’s no way, given the EPA’s obligations under both current law and Supreme Court precedent, to address emissions in a way that threads the needle of intractable politics. Either the EPA regulates the coal industry or the federal government fails to meet its commitment to regulate greenhouse gases.
EPA Administrator Scott Pruitt has offered one potential way out. In 2014, while serving as Oklahoma’s attorney general, he drafted an alternative to the Clean Power Plan that relies on the principle of “cooperative federalism”: the federal government establishes general guidelines, and then each state is permitted to try whatever form of regulation it finds appropriate and adequate to meet those guidelines. He suggested narrowing the EPA’s ability to dictate standards, limiting the scope of the rule, and giving the states more power and flexibility to determine compliance.
Of course, even relegating the EPA to a “ministerial” function would still create a regulatory burden on the power sector, violating one of the current administration’s central commitments.
Some coal-industry advocates suggest the EPA should roll back the endangerment finding and get out of the business of regulating greenhouse-gas emissions altogether. That would be inordinately difficult, given the confidence in the scientific literature that anthropogenic greenhouse gases are the predominant driver of global climate change and that climate change will have substantial impacts on disease, temperature extremes, precipitation patterns, the sea-level rise, and other factors that will affect public health and the economy. Though the administration has exploited the often convenient politics of questioning the science of climate change, there is no defensible case to be made that anthropogenic greenhouse-gas emissions have no negative impact on human health and welfare.
The administration, though, has another way out as well: call on Congress.
Congress hasn’t made substantive amendments to the EPA’s authorities since 1990 and has never specifically legislated about the EPA’s role in addressing climate emissions. While the environmentalist left has dominated the discussion about climate change, it has failed to offer a policy solution that would meaningfully address greenhouse-gas emissions. Indeed, by all accounts, fracking technology, not environmental policy, is what has caused the United States to lead the globe in emissions reductions.
Conservatives should not miss this chance to lead. While the political right has been deeply suspicious of the big-government approaches to emissions reductions that have dominated the policy conversation to date, they also have failed to take 21st-century environmental challenges seriously. With bicameral majorities, conservatives can find their voice and develop authentic, principled solutions to addressing the challenge of climate change.
Those solutions are out there. Many conservative thought leaders support revenue-neutral carbon pricing for good reason: it would take decisions out of the hands of regulators and let the market determine the best way to reduce emissions. Improving our innovation engine would support the technological developments needed to make emissions reductions cheaper than the alternative. Modernizing regulations across government is a necessary prerequisite to ensure emerging technologies have access to energy markets and are appropriately compensated. These are small-government ideas that shrink the profile of regulators, minimize the preferences of bureaucrats, and allow the market to define the future.
Administrator Pruitt has criticized “the arcane and obscure workings of a regulatory process into which the public has little input.” Now he finds himself in charge of that process. But perhaps he will find Congress more helpful, if it is willing to step up.
Catrina Rorke is director of energy policy at the R Street Institute.