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Trump Keeps Rollin', Rollin' Back US Auto Emission Standards and Other Critical Regulations

image credit: Photo by Jeremy Yap on Unsplash

In the midst of a global pandemic, the Trump administration continues to disregard science by sharply cutting the Corporate Average Fuel Economy (CAFE) standards negotiated by the Obama administration. The rollback is both the most impactful and heedless environmental deregulation of Trump's presidency.

The cuts are the most impactful because the transportation sector is the single greatest source of the greenhouse gases (GHGs)responsible for Earth's warming, e.g., CO2. They are heedless because the action exceeds a target the auto industry has readily admitted they are prepared to meet. Worst of all, the rollback maintains the element markets most abhor—uncertainty.

The Trump administration’s Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule requires automakers to increase fleet efficiencies to reduce carbon dioxide emissions by 1.5 percent a year through model year 2026. An amount roughly equal to 40 miles per gallon (mpg). This as compared to the five (5) percent year-over-year increase mandated by the Obama administration. The 5 percent target is roughly equal to 54 mpg[i].

Initially, the administration had proposed freezing the CAFE standard at the 2020 level of 41+/- mpg. Why it adopted the slightly more stringent standard in its final order is not entirely clear. Trump and company may believe the bump-up will protect them in court as it gives the appearance of heeding the warnings of peer-reviewed climate studies. Given three years of conservative judicial appointments—including two Supreme Court justices—they may be right.

The release of the final rule has not ended the battle between the administration and the climate defense community. It has merely changed the venue. The outcome of the case and the time needed for it to wend its way through to the US Supreme Court (SCOTUS) is a matter of speculation. Based on judicial histories in similar cases, it could take the courts between one and five years to come to a final decision.

There is an inherent danger in bringing the case before a federal court that is beyond the narrow question of whether the SAFE rule was properly arrived at by the Trump administration. The litigants will invariably cite the case of Massachusetts v. EPA and the subsequent endangerment finding made by the Obama administration, i.e., the Environmental Protection Agency (EPA) in 2009.

Both the decision in Massachusetts and the later finding are integral parts of the foundation upon which aggressive federal climate defense policies, e.g., the Obama-era Clean Power Plan, can be built without new legislation. Any “tweaking” of these precedents could undermine future executive actions, e.g., the issuance of new emission rules, and call into question the validity of existing non-vehicular environmental regulations.

A brief history of the auto efficiency standards is in order. CAFE standards were first introduced to the nation in 1975 as part of the Energy Policy and Conservation Act (EPCA). Motivating the new rules was the 1973 oil embargo. Congress and President Ford sought to lower reliance on foreign oil as a way to decrease the impact of any future shortages. The environment received little more than a wink without a nod from lawmakers at the time.

Fleet efficiency averages stayed much the same until the Energy Independence and Security Act of 2007 (EISA) was signed into law by President G.W. Bush. Efficiency standards were again viewed as a means for reducing reliance on foreign petroleum. Oil consumption was on the rise, in large part due to the relative stagnation of the CAFE standards, the doubling of annual vehicle miles traveled in the previous 25 years, and a sizable increase in the market share of less-efficient SUVs and light trucks.

EISA raised the combined average of SUVs, cars, and light trucks to 35 mpg by 2020. Between 2020 and 2030, expectations for further increases were phrased as the maximum possible rather than a number. President Obama, in 2009, saw in the regulations a splendid opportunity to limit harmful GHG emissions. Later in his administration, he would see these emission targets as an integral factor in the calculus used to determine the nation’s pledged reduction in carbon emissions that the signatories to the Paris climate agreement were expected to make.

In 2009, an historic agreement between the Federal Government, state regulators, and the auto industry established a national program for implementing the first meaningful fuel efficiency improvements in over 30 years and the first-ever global warming pollution standards for light-duty vehicles.

The agreement came about because of the unfortunate position the auto industry found itself in during the Great Recession. Obama knew there would never be a better time to get the auto industry to agree with his proposed target(s) than when they were coupled to its rescue. He wanted the average fleet-wide fuel efficiency to be 54.5 mpg by 2025; they needed the money. It was an easy decision for the industry to make—and, after all, a lot could happen in ten years.

Opening the door to federal regulation of auto emissions under the Clean Air Act (CAA) was the decision in the Massachusetts case. The suit flowed from the Bush administration’s claims that it lacked statutory authority to regulate tailpipe emissions and the science behind climate claims still being inconclusive.

The decision by the US Court of Appeals for the District of Columbia Circuit upheld the Agency's claims and was appealed to the US Supreme Court (SCOTUS). Plaintiffs in the case were many of the same blue states, cities, and environmental defense organizations that have challenged most of the Trump administration's efforts to roll back existing environmental protections[ii] to a time before the Nixon administration. The high court overturned the appellate court's opinion in a narrow 5 to 4 decision.

SCOTUS ruled that the CAA gives EPA the authority to regulate tailpipe emissions and obligates it to do so if it finds climate change threatens the health and welfare of the nation and tailpipe emissions are a contributing factor. In 2009 the Agency issued its science-based finding that the buildup of heat-trapping greenhouse gases in the atmosphere endangers the public's health and welfare.

The endangerment finding was promptly challenged in Coalition for Responsible Regulation v. EPA. The Coalition was a group of 14 largely red states, including Oklahoma. Appearing for the plaintiffs in the case was Trump's first EPA Administrator, Scott Pruitt, who was then Oklahoma's Attorney General. The basis of the challenge was the proposition that despite the harms associated with GHG emissions regulation of power plants and automobiles would not meaningfully mitigate global warming. SCOTUS dismissed the petition, and the case was never heard. The claim made by the plaintiffs in the case has been adopted by the Trump administration to justify its refusal to act aggressively to keep global temperatures below the 1.5 degree Celsius threshold scientists warn marks a point of irreversible damage to global eco-systems.

Early in his administration, Trump issued an executive order that was widely seen as a preamble to loosening fuel standards. When the order was released, he announced the assault on the American auto industry was over.  He repeated the sentiment in a tweet announcing the final rule:

As with so many of his tweets, the boast is not true. An analysis of the new rule has concluded it could impose an overall cost on the economy of up to $22 billion and lead to the loss of roughly 13,000 jobs in a single model year—2029. Outcomes far from what is being promised by Trump.

In a statement echoing the words of his leader Environmental Protection Agency administrator Andrew Wheeler said the new rule strikes the right regulatory balance that protects our environment and sets reasonable targets for the auto industry. Ironically, the marks it sets are below what the auto industry is already willing to meet both in the US and abroad.

Senator Tom Carper (D-DE) wrote in a letter to the Office of Information and Regulatory Affairs (OIRA) that SAFE would result in the saving of some 470 lives over its course and release around 900 metric tons of CO2  as the result of consuming more than 80 billion gallons of gasoline over the Obama targets. A senior vehicles analyst for the Union of Concerned Scientists has pointed out the tradeoff is far from economic when the number of lives lost or weakened because of the added pollution is factored into the equation.

The auto companies saw in Trump's election an opportunity to renegotiate the deal they made with President Obama. The Obama targets were less troubling for manufacturers than how they could be met. What the industry was looking for was flexibility in meeting the targets and perhaps a little extra time—not a freeze or rollback to 1.5 percent of the 2020 level.

The battle surrounding the SAFE rule is about more than emissions. It is about the federal-state regulatory relationship as tinged with Trump’s own brand of pejorative politics. Since the CAA was first passed into law, California has been granted a waiver to set a more strident standard than the one established by the federal government—with one exception. The one exception was at the end of the G.W. Bush administration. Bush's refusal to allow the waiver was so quickly overturned by President Obama, however, that it never actually came into effect.

Last year the Trump administration pulled the California waiver. Trump’s made no secret of his enmity for most things California, starting with his ill feelings towards House Speaker Pelosi and the unwillingness of many California cities to report and round-up illegal entrants to the US.

The waiver action predictably triggered a lawsuit by California and the 13 states and the District of Columbia that follow the stricter standard. Several major cities have also joined the suit bringing the plaintiff total to 23.

Surprisingly the waiver revocation has split the auto industry itself. In 2019, Ford, BMW, Volkswagen, and Honda negotiated their own agreement with California. By mutual consent, the companies would produce passenger vehicles averaging 51 mpg by 2026 and the state would grant the companies their hoped for flexibility in meeting the target. Trump’s response to the side-deal was to order the Department of Justice to prosecute the companies under antitrust laws.

The threatened suits never came to pass. Now in 2020, it appears as if Volvo has also stepped across the line to join the group of automakers pledging to support the 51 mpg by 2026.

The five auto companies have agreed to the stricter California rule for some very practical reasons. Not these least of the reasons is their recognition that the EU, UK, China, and other Asian nations are much more aggressive in their regulatory responses to climate change. In the US more efficient vehicles are also being demanded by the growing number of consumers and voters who believe that the release of greenhouse gases threatens the health and welfare of current and future generations. Moreover, the industry believes now—as it did in 2009—that a lot can happen in ten years. The political winds in the US will invariably come from a different direction—perhaps in less than a year.

The truth is the Trump rule is anachronistic even before it can take effect. Its real danger may be in any judicial decisionsresulting from the legal challenge to the rollback.                                       

How is this possible? By the end of his first term in office, Trump will have appointed two Supreme Court justices and between 1 out of 8 and 1 out of 2 judges on the federal bench. Is this likely to happen? Probably not—at least no more so than Trump’s having gained the presidency in 2016. Still, it’s risk on!

What if Biden or Sanders became president, couldn't they "just" retract Trump's executive order and direct their administration to go back to the Obama standard? As with many political questions, the answer takes the form of "yes, but…" The "yes" part of the answer is that executive orders can be as easily retracted as they were originally initiated. The "but" part is trickier to negotiate.

Given an increasingly conservative federal judiciary, a conservative trial or appellate court could decide to overturn the Massachusetts decision—or at least tweak it a bit. A court could also use established case law, i.e.,  the Chevron deference,  to defer to the Trump administration's reading of the available scientific evidence of the causes and consequences of climate change.

The Massachusetts case was decided by a slim 5 to 4 majority, with the minority opinion being written by Justice Antonin Scalia. Scalia is the conservative Justice against whom all others are judged. The deciding vote in the case was cast by an almost equally conservative Justice Anthony Kennedy. For those without a program, Justice Gorsuch is filling Scalia's seat on the high court bench. Justice Kavanaugh is occupying Kennedy's seat.

The majority in Massachusetts saw the refusal of Bush's EPA to consider the science behind climate change as compelling federal action under the Clean Air Act—if, that is, the Act compelled any such action at all. Judge Stevens, writing for the majority, described the Agency's decision in part this way:

Even assuming that it had authority over greenhouse gases, EPA explained in detail why it would refuse to exercise that authority. The agency began by recognizing that the concentration of greenhouse gases has dramatically increased as a result of human activities, and acknowledged the attendant increase in global surface air temperatures. EPA nevertheless gave controlling importance to the statement that a causal link between the two' cannot be unequivocally established.' Given that residual uncertainty, EPA concluded that regulating greenhouse gas emissions would be unwise.

In essence, EPA concluded that climate change was so important that unless Congress spoke with exacting specificity, it could not have meant the agency to address it. (emphasis added)

Kavanaugh, like Gorsuch, is considered a constitutional textualist or originalist.  Justice Scalia described his originalist position as follows:

The Constitution that I interpret and apply is not living but dead, or as I prefer to call it, enduring. It means today not what current society, much less the court, thinks it ought to mean, but what it meant when it was adopted. (emphasis added)

In short, the textualist philosophy is if the framers of the Constitution intended what liberals are saying, they would have said so in no uncertain terms. Originalists—at least those like Kavanaugh—admit that climate change is real, and federal regulation is permissible under the Constitution. However, they hold it is up to Congress to say what they mean within the legislation and not leave it up to the courts to decide—even in cases like the CAA when, at the time of enactment, the conclusions of climate science were not so overwhelming understood.

Scalia took care to note that the CAA "condition[s] the exercise of EPA's authority on its formation of a 'judgment' that a class of pollutants requires regulation.”  He was also of the opinion that EPA had offered up a reasonable explanation for why it was refusing to regulate tailpipe emissions:

 [E]stablishing [greenhouse gas] emission standards for U. S. motor vehicles at this time would … result in an inefficient, piecemeal approach to addressing the climate change issue. The U. S. motor vehicle fleet is one of many sources of [greenhouse gas] emissions both here and abroad, and different [greenhouse gas] emission sources face different technological and financial challenges in reducing emissions. A sensible regulatory scheme would require that all significant sources and sinks of [greenhouse gas] emissions be considered in deciding how best to achieve any needed emission reductions.

Thirteen years after the Massachusetts decision, the Trump administration parrots this rationale in every rollback or rescission of a climate-related regulation, e.g., the Clean Power Plan.

Climate science has come a long way in the past dozen years. Still, there are those in the administration from the president on down who continue to deny the validity of what the global climate-science community has to say about the causes and consequences of Earth's warming. Members of the group indulge themselves by hiding behind the argument of whataboutism, e.g., what about the pollution emitted by China and India that makes anything the US might do to decrease its emissions almost meaningless.

Will the rollback of the Obama-era auto efficiency standards lead to SCOTUS overturning the Massachusetts case and open the door for the Trump administration to rescind or revise EPA's endangerment finding? Probably not, but possibly so—given that many of Trump's judicial appointees are textualists some of whom feel less constrained by previous judicial opinions.

The finalization of the SAFE rule makes it harder for an environmentally-conscious president to "just" retract what the Trump administration has done. Although the underlying executive order can be rescinded, replacing Trump's rule would require a new rulemaking—a process that takes several years to complete.

The Trump administration will move quickly over the next several months to finalize as many rescissions or revisions of environmental regulations as possible as insurance against a loss in November. Mindful of a potential blue wave that gives the Democrats control of Congress and the White House, conservative Republicans will try to obviate the use of the Congressional Review Act's (CRA).

The Act directs federal agencies to submit copies of major rules and policy guidance to Congress, giving it 60 legislative working days to overturn the regulation without the need for a new rulemaking. Nullifying the regulation requires the passage of a Joint House/Senate Resolution, by simple majorities and the signature of the president.

The next several months are critically important to a timely defense of the environment. The coronavirus pandemic is already being used as an excuse by oil and gas groups to petition the administration to ease certain environmental restrictions, e.g., record-keeping, and by the administration to slow its enforcement of existing environmental regulations.

With oil prices sinking into the teens, many companies are facing bankruptcy. Those heavily invested in shale oil will have an especially hard time weathering the precipitous drop in demand caused by the pandemic and the price war between Russia and Saudi Arabia.

As I've written before, energy and environmental issues like the extension of the solar and wind tax credits, federal purchases of large quantities of petroleum to be put in storage, and green infrastructure projects will be hotly debated in the next iteration(s) of stimulus legislation.

The rollback of the Obama-era auto fuel efficiency standard marks the most impactful and heedless act of the Trump-era. It is essential, however, not to let the pandemic be used as a blind for other potential deregulatory steps the administration may attempt in the closing months of Trump's first term.

Truth to power—whatever the outcome of the November election Trump and company will leave behind an environmental protection framework in tatters. A wrecked framework that will take an environmentally-conscious Congress and president years to repair in a manner equal to the historic challenges ahead that world will face.  Challenges not unlike the pandemic it’s facing now.

Photo by Jeremy Yap on Unsplash

 


[i] The equivalencies of mpg to percent of efficiency increases quoted by various sources differ by +/- 3 mpg.

[ii] The petitioners were the states of California, Connecticut, Illinois, Maine, Massachusetts, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, and Washington, the cities of New York, Baltimore, and the District of Columbia, the territory of American Samoa, and the organizations Center for Biological Diversity, Center for Food Safety, Conservation Law Foundation, Environmental Advocates, Environmental Defense, Friends of the Earth, Greenpeace, International Center for Technology Assessment, National Environmental Trust, Natural Resources Defense Council, Sierra Club, Union of Concerned Scientists, and the U.S. Public Interest Research Group. The Massachusetts Attorney General's Office represented the petitioners in oral arguments before the U.S. Supreme Court.

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