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Clean Power Plan Is Dead

David Bookbinder, formerly chief climate counsel for the Sierra Club and now a consultant with the Niskanen Center, is one of the sharpest policy experts I know. Bookbinder was a lead attorney for environmental groups in Massachusetts v. EPA, the landmark case in which the Supreme Court ruled that greenhouse gases are air pollutants for regulatory purposes under the Clean Air Act.

During the past two years, the Niskanen Center has warned there is no plausible scenario in which “conservative political force” rolls back the rising tide of greenhouse gas regulation. Hence, the Center argues, conservatives’ only hope of averting decades of regulatory excess is to advocate an alternative climate policy acceptable to the greens—a carbon tax.

Indeed, in March 2016, Niskanen President Jerry Taylor predicted Donald Trump would “get slaughtered” in the presidential contest. Had that happened and Hillary Clinton’s coattails put the Senate back under Democratic control, the carbon tax crowd would no doubt be proclaiming the election results as proof that resistance to coercive climate policy is futile.

But Trump won and now many experts say the Environmental Protection Agency’s (EPA) Clean Power Plan and the Paris Agreement are in big trouble.

What’s the political lesson for conservatives? The EPA’s regulatory overreach might still loom large had the Republican establishment in Washington, D.C. taken the Center’s advice and endorsed a carbon tax. The clear distinction between a party that is pro-tax and anti-energy and a party that is pro-energy and anti-tax is a product differentiator of immense political value for the GOP. Carbon tax advocacy would have frittered away that asset. Worse, including carbon taxes in the platform would have divided the GOP on an issue of longstanding national controversy and demoralized the party’s activist base.

Bookbinder and Taylor now make the case that, despite Trump’s victory, conservatives should advocate a carbon tax. I’m unpersuaded. What impresses me, though, is Bookbinder’s candor. Even though fear of the Power Plan was useful in pitching conservatives on carbon taxes as the lesser evil, Bookbinder and his colleague David Bailey now pronounce EPA’s marquee policy to be dead:

All that being said, the Clean Power Plan is dead. Regardless of whether the Trump EPA waits for the D.C. Circuit decision, the easiest thing for it to do is first amend the rule to provide that, once the judicial stay of the CPP is lifted, the states will have an extended period (say, 5-7 years) to submit their implementation plans, which effectively kills the CPP. The timing of the steps in a regulatory process is as close to an unreviewable agency action as there is, and no court would overturn it. Even assuming that the D.C. Circuit then upholds the Rule, EPA could then withdraw the CPP for reconsideration, and thereafter issue a new rule based only on modest inside-the-fence actions. Environmental NGOs and the states supporting the CPP would challenge this, but since there is a legitimate legal argument that EPA’s authority ends at the fence-line (and with 27 states supporting this new interpretation) the D.C. Circuit would, in our view, likely defer to EPA’s new reading.