February 28, 2016: Clarifying Intentions, New Executive Orders, and Budget Cuts

A note on politics and policy

This past week as a part of a lawsuit, EPA Chief Scott Pruitt’s office made public thousands of emails between his office and a number of oil and gas companies, notably Oklahoma-based Devon Energy. The “often chummy” emails reveal that company officials met regularly with Scott Pruitt’s office and wrote much of the language in a number of letters sent to EPA and other federal regulatory agencies by the state’s AG office, in an attempt to halt specific new regulations.

The concerns over Pruitt’s ties to the industry prompted Senate Democrats to call for Pruitt’s confirmation as the head of American environmental enforcement to be delayed, but Senate Republicans were able to simply bring his confirmation to the floor on schedule.

Although these developments are interesting, and the public should perhaps have had knowledge about the content of these emails prior to Scott pruitt’s confirmation, this story and others like it do not exactly fit with the mission of this blog. I want to explore policy changes in Washington, not keep up with the daily political news. The line between these two is thin, and it is often useful to contextualize changes within say, Scott Pruitt’s cozy ties to the oil and gas industry. Moreover, politics is essential to production or stalling of policy especially within the federal government, and as such can heavily determine policy outcomes. I will do my best to insulate policy from politics, while keeping policy change in its proper political context.

 

Trump signs Executive Order reforming regulatory process

Donald Trump signed an executive order on Friday February 24 further targeting regulatory agencies. The Executive Order mandates that each federal agency appoint an officer to carry out policy on regulatory reform. The officer will identify regulations that “inhibit jobs”, “are outdated, unnecessary, or ineffective”, and “impose costs that exceed benefits” and submit this information to the agency. The goal, according to the order, is to “alleviate unnecessary regulatory burdens placed on the American people”. While this may seem like an overly procedural and largely harmless policy change, I argue that in the context of other administration actions and political posturing, this is an important and insidious executive order.

It is true that the regulatory oversight officer would have no institutional power to eliminate rules and regulations, the fact that it exists and is obviously a priority of the administration tells us a lot about a new approach to agency regulation. Indeed, this order should be placed in the context of adviser Steve Bannon’s comments about the “deconstruction” of the administrative state under Trump, President Trump’s comments this weekend that we don’t need around 75 percent of existing regulation, other anti regulatory executive orders, and proposed budget cuts for regulatory agencies. This executive order makes it more difficult to pass new regulation and puts in place mechanisms to phase out existing regulations that are deemed unnecessary. It represents an executive-led and inter-agency approach to dismantling regulation that will likely continue with anti-regulatory agency heads and directed by new executive orders. We have a President who, following previous expansions to the ability of the executive to act as they please, is pursuing his agenda on energy and the environment without, to some degree, the input of Congress. This is significant. Even with a unified government, that could pursue rollback and hamstringing regulation by Acts of Congress (which has happened, true), the President has taken action. There are a number of possible explanations. Perhaps simply President Trump wants to act quickly to reverse the regulatory mechanisms of the state and simply is doing so using his authority. Perhaps, the President is functioning in a system where Congressional Republicans are unwilling politically to do the work of intense regulatory rollback and perhaps suffer consequences at the polls. More waiting and watching is required to answer these questions. 

 

Rumors about other Executive Orders

Although few substantive changes have happened so far this week, there are increasing signs of what is to come. Multiple news outlets have reported that the Trump administration intends to come out with two separate environmental executive orders: ordering EPA to reevaluate its Waters of the United States Rule (WOTUS), and instructing the Interior Department to lift a moratorium on the leasing of public lands to industry for coal exploration and mining. The executive order concerning WOTUS is expected shortly. The specifics of the orders are unclear, nor is it known exactly when they will be released.  I will be sure to cover the details and implications of those orders if released.

 

Budget cuts for EPA coming

Although nothing formal has been released, administration officials over the weekend and early this week have made it clear that the FY2018 budget of the federal government will combine around $54 billion in cuts to domestic federal agencies, likely including EPA and the Interior Department. EPA and the State Department were the agencies singled out by administration officials as specific targets of the budget. This will be paired with an equal $54 billion increase in military and defense spending. To put this in context, EPA’s 2017 budget was less than $8.3 billion. In January, Trump EPA transition leader Myron Ebell predicted that the President would seek a $1 billion reduction in EPA’s budget. A one billion dollar cut seems at this point like a conservative estimate. It should be noted, however, that the Republican Congress will have to sign off on Trump’s order, and it will be fascinating to see if Republicans carry through, or balk, on cutting funding for domestic regulatory agencies.

 

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February 21, 2017: Uncertainty and Scott Pruitt

Scott Pruitt becomes EPA chief

On Friday, February 18, Scott Pruitt was confirmed by the Senate to become the EPA Administrator. The Senate voted 52-46 to confirm Mr. Pruitt.  This was largely split down party lines; two Democrats voted for Mr. Pruitt, and one Republican, Senator Susan Collins from Maine, voted against him.

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Scott Pruitt being sworn in as EPA Administrator, Feb 17. Photo: Reuters

Scott Pruitt represents a radical shift in EPA priorities. Pruitt is likely to scale down the activities of the EPA significantly, although exactly what he will do is unclear and is also constrained by the agencies’ considerable legal mandates. In an interview in the Wall Street Journal shortly after his confirmation, Pruitt stated that there will be a withdraw of existing climate rules (referencing former President Obama’s Clean Power Plan), and that this will trigger legal processes that could result in a new interpretation of the Clean Air Act so that it may not apply to carbon dioxide and other greenhouse gases. This statement is in contrast to Pruitt’s nomination hearings, during which he told members of the Senate Public Works and Environment Committee that the EPA does have a role in regulation carbon dioxide, and that the legal basis for the endangerment finding (a 2009 EPA declaration that carbon dioxide represents a danger to human welfare), is sound. This news seems to imply that Pruitt and the EPA will take legal steps to not only undo climate protections, but in the process also undo the legal basis for climate change policy in this country. Although Pruitt is a seasoned legal opponent of EPA climate protections, there are significant roadblocks to such actions In the 2007 Supreme Court case Massachusetts v EPA, the Court held that EPA does have the authority to regulate carbon dioxide as a pollutant under the Clean Air Act. In the WSJ interview, Pruitt mentioned that an act of Congress may be necessary to change the way US agencies treat carbon emissions. There is a law introduced in the House this session cosponsored by over 100 Republicans (similar iterations have been introduced in previous sessions) that aims to stop any federal agency from regulating greenhouse gases in any way. Although this law will likely not pass, this is what a potential act of Congress could look like in this realm.

Trump signs Stream protection repeal

On Thursday, Feb 16, Donald Trump signed into law a bill that dissolved an Interior Department Rule that would seek to shield nearby streams from waste disposal as a byproduct of coal mines. The bill was passed by both Houses of Congress under the Congressional Review Act (CRA), which allows Congress to review agency rules in a short period after they are issued. The White House released a statement arguing that the move is necessary to ease burdens on coal producers, and is a part of a broader project to undo Obama-era regulations on industry.

February 16, 2017: Trump’s First Regulation Overhaul, Upcoming EPA Chief Confirmation

It’s been a quiet week in Washington, although the upcoming battle over Scott Pruitt’s confirmation vote looms on Friday or sometime next week, although Senate Democrats are now pushing to delay the vote.

Scott Pruitt’s confirmation coming soon

According to Inside EPA, President Trump is expected to attend the swearing-in ceremony of Scott Pruitt if he is confirmed by the Senate (it is likely that he will be). After the ceremony, Trump is expected to sign executive orders related to EPA and the environment. While this report is unverified, Trump transition officials warned of executive actions on rolling back Clean Water Act jurisdiction, altering the use of the “social cost of carbon” from agency cost-benefit analyses, and taking steps to phase out Obama’s Clean Power Plan, among other rules. Vox news recently published a comprehensive piece on the possible directions that potential EPA Chief Scott Pruitt and the Trump Administration, as well as Congress, could take the EPA. Those interested in American environmental policy should pay close attention to Scott Pruitt’s confirmation on the Senate floor.

 

Trump signs CRA bill to reduce transparency from the oil, gas, and mining industries

Donald Trump signed into law a repeal of a last-minute Obama Administration rule within the Securities and Exchange Commission (SEC). The rule was a part of regulating industry after the 2008 financial crisis. The rule required publicly-traded American oil and gas companies to disclose payments they make to foreign governments. Fossil fuel industries are no longer required to disclose those payments. Congressional Republicans and the Trump Administration argue that the rule puts American businesses at a disadvantage, and that its repeal is a part of “bringing jobs back”.  This was the very first “Resolution of Disapproval” under the Congressional Review Act that President Trump has signed, and his third total piece of legislation. This move perhaps should be interpreted as a signal that rolling back environmental regulation is a priority.

February 14, 2017: Catching Up

Here’s a rundown of all of the major environmental policy changes and political battles that have occurred since the 115th Congress was sworn in on January 3:

Revival of Keystone XL, Dakota Access Pipelines 

On January 24, President Trump signed executive orders reviving, and expediting the environmental review process of the Keystone XL Pipeline, and the Dakota Access Pipeline (DAPL). The President justified his action by stating that the regulatory process has become overly burdensome for developers. The orders essentially direct the Army Corps of Engineers to move forward on the projects. On February 7th, the Army Corps of Engineers granted an easement for the completion of the Dakota Access Pipeline, circumventing entirely the environmental review process. Construction has begun as of Thursday, February 9, as the pipeline is being installed under the Missouri River reservoir that provides water to the Standing Rock Sioux Tribe. There likely will be legal challenges. The Obama administration had established previously that an environmental review must be completed for DAPL, and there must be sound legal basis to alter this ruling. Both pipelines carry crude oil from Alberta to refineries in the Midwest.

Axing contributions to UN Climate Change Initiatives

Congressional Republicans introduced a bill that would forbid any public body to contribute to the Green Climate Fund (GCF), the central funding mechanism for the Paris Agreement of the UN Framework Convention on Climate Change (UNFCCC). This is largely a symbolic move and may not be a high priority as such. Furthermore, similar iterations have been introduced in Congress before, but were obviously futile with a Democratic executive. In the past, President Obama circumvented Congress to contribute to the GCF through State Department program money. President Trump will likely not direct his State Department to send money to the UNFCCC, although Secretary of State Rex Tillerson has not been clear about his intentions with the Paris Agreement. In confirmation hearings, he told Senators that the United States should “maintain its seat at the table”.

Proposal and pushback on selling federal lands

Rep Jason Chaffetz (R-UT-3) introduced a piece of legislation entitled the Disposal of Excess Federal Lands Act, that would direct the Interior Department to sell 3.3 million acres of federal lands in 10 Western States. The identified lands were those parcels categorized as unproductive to taxpayers in a 1997 survey. After push back from constituents, environmental groups, and hunting groups, Chaffetz withdrew the Bill from consideration.

Repeal of the “Stream Protection Rule”

Congressional Republicans, invoking a decades old, rarely used piece of legislation called the Congressional Review Act (CRA)*, voted to repeal an Interior Department Rule that prohibited the dumping of coal mine-produced waste into nearby waterways that were outside of the permitted mining zone. The CRA is a mechanism for Congress to review executive-led agency rules within 60 session days of the enactment of the rule, and so is only effective at times of presidential transition. Rep Bill Johnson (R-OH-6) said candidly in on the House floor, “the stream protection rule is not about protecting streams. It was designed for one purpose–to regulate the coal mining industry out of business. It is the centerpiece of the Obama administration’s war on coal”. The disapproval motion has passed the House and the Senate and awaits President Trump’s signing as of February 9.

House overturns BLM methane rule

In an underreported but significant move, House Republicans passed a Resolution of Disapproval under the before-mentioned Congressional Review Act that would nullify a new Obama era rule that requires companies producing natural gas in BLM or reservation land to pay a royalty on methane leaks in the form of venting and flaring. Methane is a potent greenhouse gas, and the rule was intended as part of a federal effort to reduce emissions nationwide. The rule awaits Senate and executive approval. If passed, this move represents a small, but significant step in rolling back climate protections.

House overturns BLM planning rule, 

House Republicans again invoked the Congressional Review Act to take the first step to nullify an Obama era BLM rule that seeks to strengthen the planning process and increase opportunities for public input on BLM land decisions. Congressional Republicans called the rule “unnecessary” and an example of “government overreach” that takes power from local and state officials and places it in the hands of the federal government. This move is a part of a larger debate over public lands and the role of the federal government in managing them. Liberal critics view this sort of policy as a nod to special interests looking to exploit cheap public land with little oversight. The Resolution of Disapproval currently sits in the Senate where it should pass, and will go to President Trump’s desk for signing to immediately nullify the law.

Changes at the EPA

Some social media furor erupted when four Republican lawmakers introduced a bill to eliminate the EPA. This is a momentous task and is unlikely to pass, as lawmakers would have to undo decades of legislation empowering EPA to do certain things, as well as figure out how to carry out the requirements of laws such as the Clean Air Act.

On Friday February 7, Rep Sam Johnson (R-TX-3), introduced in the House another bill to “eliminate certain programs” from EPA. According to The Hill, the bill would cut the large majority of EPA’s budget, close regional offices, and eliminate numerous air pollution and climate change programs. This piece of legislation would severely limit the ability of EPA to do its work. This action seems to fall more closely with Republican priorities and political will at this point than does complete agency elimination.

Other News Bits

  • A CRA review that would loosen EPA’s clean air rules regarding cross-state pollution was introduced in the US Senate and awaits action.
  • Another CRA review that would weaken regulations on exploratory drilling on the Arctic Outer Continental Shelf was introduced in the House on February 9. It awaits action as well.
  • Former Republican officials and party members came out in support of a nationwide, aggressive carbon tax to combat climate change, coupled with the deregulation of the oil and gas industries. The plan, according to the officials, is a true conservative climate solution.
  • Trump signed an executive order in his first week of office that mandates that for every new regulation passed, two more must be rescinded – meaning that the costs of one regulation would be offset from saving via eliminating other regulations. This is a fairly arbitrary standard, and its direct effects remain unclear. Regardless, it clearly makes introducing more regulation more difficult.

*In the first ten days of Donald Trump’s presidency, Congressional Republicans have invoked the Congressional Review Act 37 times, which is more than any other single legislative term since the CRA was passed. The Washington Post refers to these actions as the “most ambitious regulatory rollback since Reagan”.