Aug.05

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Trump On the Wrong Side of the Issue, Part II: Energy

Throughout his political career, Donald Trump has been obsessed with rolling back environmental legislation, and returning to the energy economy of the 1970s. Is that because his mindset is stuck in the gear it assumed half a century ago? Is it due to lobbying from Big Oil? Is it because Barack Obama and Joe Biden were pro-environment, and Trump is reflexively opposed to anything they supported? Could be any or all of these, or something else. We don't entirely get it.

In any event, during his first term, Trump had limited success with his reactionary approach to fossil fuels. He was delighted to throw open vast acreage to drilling from Big Oil, only to discover that nobody was bidding on the opportunity. The basic reason is that it takes a very long time, and a very large amount of money, to build oil extraction infrastructure, and it's no longer clear that's a smart gamble. Big Oil is, at least for the moment, getting what it needs from existing infrastructure, and is better off finding new ways to get more oil out of existing oil fields, rather than opening up new frontiers in drilling.

That did not stop Trump from running in 2024 on "Drill, baby drill!" This was the third time that was a core plank for him. We are not sure who, if anyone, was impressed by this promise/claim, but things are once again not going well for Trump's reactionary "environmentalism." We're not actually to the point in Trump v2.0 that Big Oil will be able to turn up their noses at the opportunity to bid on new oil fields. However, other aspects of Trump's environmental approach are going over like a lead balloon.

First up is the decision by Trump's Environmental Predation Protection Agency to roll back an Obama-era finding that global warming is a threat to public health. That finding gave the EPA vast authority to regulate emissions, particularly from cars and industrial concerns. And just in case it was not clear why the EPA changed course, the announcement about overturning the Obama-era decision was followed by a second announcement that the agency is getting rid of all motor-vehicle emissions limits.

Presumably, the Trump administration expected to be showered with praise by numerous energy concerns, since many of those energy concerns (including the trade associations that represent electricity providers and American manufacturers) were infuriated by the Obama-era decision, and fought it tooth-and-nail in court (unsuccessfully, obviously). That praise was not forthcoming (which means that the "donations" Trump undoubtedly expected are not likely forthcoming either). It is not well, these days, for a large business concern to be critical of Trump, and so the response to the EPA's announcement was... a whole bunch of silence.

And how about a second example? The BBB contains language that empowers the Trump-led Department of Interior to slash tax credits for wind and solar projects. And within days of the bill becoming law, on Trump's direct orders, the DoI did exactly that, making clear that those credits will be gone with the wind on the very first day allowed by the legislation (Jan. 1, 2027). This news left some Republican senators, to use their own words, "dismayed." One wonders if these people are being dishonest, naive, or just stupid. After all, the verbiage was put into the bill for a reason.

In any event, several Republican senators are now doing what they can to push back. Sens. Chuck Grassley (R-IA) and John Curtis (R-UT) have put holds on several high-level nominees for positions in the Treasury Department. Two members are not enough to kill a nomination, but Lisa Murkowski (R-AK), Mike Rounds (R-SD) and Thom Tillis (R-NC) have also indicated they are not happy with Trump's renewable energy plans. So, their votes might be available in support of Grassley and Curtis. Keep in mind that it's easier to stick one's neck out when it's not the only neck being exposed. Trump is pretty good at making one member suffer for rebellious behavior (unless that member is Rep. Thomas Massie, R-KY). The president is less effective when he tries to take aim at four or five targets at the same time.

The bottom line is that it is clear that Trump's anti-environmental agenda is not popular, even with the industries it should be popular with, and even within the ranks of his own party. That's not to say there is NO support for his position, but it's probably fair to say that between the Democrats and the leery Republicans, opinion is something like 2-to-1 against Trump's position. It's easy enough to come up with at least some of the reasons that would be the case:

• As we have noted many times, the industrial concerns that make fuel-consuming items ultimately have many masters. If they make, say, a car that produces few or no emissions, they can sell that car in eco-friendly places AND in places that don't give a damn about greenhouse gases. On the other hand, if they make a gas-guzzling carbon machine, they can only sell in the places that don't give a damn. At the moment, most of Europe, much of Asia, Canada, large blue states like California and Illinois, and the U.S. when it's under Democratic governance all want eco-friendly products. The trend is only going to gain speed, particularly given that many nations, states, and municipalities have set aggressive net-zero goals that are supposed to be met in the next couple of decades. The industrial concerns can see the writing on the wall (not to mention the demands of their current customer base), and can see that if they commit to bad-for-the-environment products, they will be setting themselves up for disaster sometime very soon.
  
  
• Large-scale wind and solar farms generally have to be built in low-population areas with lots of open space. In other words, rural areas. And you know where there are lots of rural areas that could use some investment in 21st century industries? Red states. Chuck Grassley, in particular, has been representing Iowa in Congress for 50 years. He knows pork when he sees it, no matter what particular costume it might wear.
  
  
• Climate change denial might have been a political winner a decade ago. However, the voters who could afford to engage in that fantasy, by virtue of not having to worry about whether or not Earth will be a hellscape by the year 2060, are dying off. The folks who backed that position with hundreds of millions of dollars in donations are also shuffling off this mortal coil. In particular, the Koch brothers did more than any other interest to turn the GOP into a climate-change-denial party. And one of the Kochs is now dead, while the other is 89 and has had multiple bouts with cancer. Young voters almost universally believe in climate change, and in trying to fight climate change, since they are going to have to live with it. That means climate change denial is not exactly a growth opportunity for politicians on either side of the aisle.
  
  
• In addition to the looming climate catastrophe is the very much related looming economic catastrophe. A lot of things are about to get more expensive, and the worse the climate change is, the worse it will be. An early indicator, since this industry has to be in the business of looking 10-30 years down the line, is insurance prices. Indeed, the day may soon arrive that people in the east simply cannot get hurricane insurance, the way people in the west are currently struggling to get fire insurance. Voters are going to be angry when they cannot get their houses and businesses covered, and some of them will have the unfortunate experience of taking that anger to the next level, when they lose their impossible-to-insure properties to a natural disaster. No politician or political party wants to be on the hook for that, if they can avoid it.

Trump can afford to be fixated on his anti-environment crusade, since he does not have to worry about being elected again, nor does he likely need to worry about Earth becoming increasingly uninhabitable 10-20 years from now. But, despite his delusions to the contrary, he is clearly on the unpopular side of this issue. And the harder he flogs it, the more likely it is to hurt his downward-trending approval numbers. (Z)