Walters: A Cross-Continental Game of Political Chicken

There are dozens of cross-continental disputes between the Trump administration in Washington and California’s Democrat-dominated state government, most manifesting themselves in lawsuits.

However, few if any surpass in importance their conflict over how much greenhouse gases cars will be allowed to emit in the future.
The federal government saved General Motors and Chrysler from bankruptcy during last decade’s financial crisis, giving Donald Trump’s predecessor, Barack Obama, leverage to impose new fuel economy standards on the auto industry – an average of 54.5 miles per gallon by 2025.
It was a huge, albeit indirect, win for California’s aggressive Air Resources Board – forcing the rest of the nation to adopt the economy standards that the ARB had imposed on cars sold in California, under a long-standing waiver from the federal government.
Although automakers grudgingly accepted the mileage standard in 2008, they also complained loudly that it would boost car prices, decrease jobs and force them to sell more zero-emission autos, principally battery-powered, at giveaway prices to raise the overall fuel economy of their sales.

Talks on Compromise Have Broken Down

After Donald Trump was elected in 2016, the industry appealed for a respite from the 2025 standards and he agreed, thus setting up the conflict with California and other states that had voluntarily followed the state’s lead.
In fact, Trump’s Environmental Protection Administration went further than automakers had wanted. While the automakers sought relaxed mileage targets and more flexibility in meeting them, Trump’s EPA pushed for a complete rollback, freezing the 2020 standard of 37 miles per gallon.
California and 16 other states sued, and the automakers found themselves caught in the middle of another federal-state conflict, pleading for a compromise.
However, fitful talks on a compromise have broken down with each side accusing the other of refusing to make a good faith effort.
The White House says it is “moving forward to finalize a rule with the goal of promoting safer, cleaner, more affordable vehicles.”
“Federalism does not mean that one state can dictate the standard for the entire nation,” EPA director Andrew Wheeler said during the Washington Auto Show in April. “I met with CARB three times since taking the helm of EPA last July, but despite our best efforts, we could not reach a solution and decided to end the discussions.”

A Game of Political Chicken

Mary Nichols, who chairs the California ARB, has chastised the auto industry for opening the can of worms, suggesting that if the conflict continues, California might just ban sales of cars powered by gasoline or diesel fuel.

“What were you thinking when you threw yourselves on the mercy of the Trump administration to try to solve your problems?” Nichols shot at industry executives during a public meeting.
However, Wheeler has also threatened that if California balks, the Trumpies might withdraw the state’s air pollution waiver, which is based on California’s claim of “compelling and extraordinary conditions.”
It’s a game of political chicken, each side believing that the other will either blink or lose in court, with California obviously playing for time, hoping that the conflict will vanish if a Democrat defeats Trump in 2020.
But it’s also a game with high stakes, financial and otherwise. Its outcome will determine what kind of cars Californians – and perhaps all Americans – will be able to purchase and what they will cost.
It also will determine whether California can meet its self-proclaimed goals of reducing greenhouse gas emissions, since cars are the largest single emission source, and establish itself as a global leader in battling climate change.
CALmatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters. For more stories by Dan Walters, go to calmatters.org/commentary.