Low-Energy Fridays: Are Trump’s Executive Orders a Big Deal for Climate Change?

Washington, D.C. is in a tizzy over President Donald J. Trump’s rescission of a slew of policies implemented under former President Joe Biden, and energy policies are receiving special attention in multiple executive orders (EOs). Trump withdrew from the Paris Agreement, ended the social cost of carbon, and ordered a halt to climate-related regulation and offshore renewable energy leases—all with the stroke of a pen. And that was just Monday.

These actions have drawn some predictably overwrought reactions—for example, Vox called Trump’s actions an “attack on climate progress.” Cutting through the hyperbolic articles, we should ask two important questions: How effective were these policies to begin with? And should executive authority be the primary vehicle for energy policy?

The purpose of climate policy is to lower emissions. We’ve covered it in other pieces, but command-and-control policies that rely on executive authority are among the least efficient forms of climate policy. This is partly due to limitations on regulatory authority, but more so because market forces tend to be more powerful in altering the dynamics of energy consumption—the primary source of greenhouse gas emissions.

In fact, the main reason for declining power sector emissions has been the uptake of low-cost natural gas, not power plant regulations or subsidies. Likewise, the trend of shifting large amounts of capital toward clean energy began before subsidy expansion under the Inflation Reduction Act as a means of cutting costs while capturing customers who value climate action.

Another reason regulations are less effective at reducing emissions compared to other factors is that they are regularly shot down in court. Many of Biden’s efforts were unlikely to survive pending legal challenges. To mourn the loss of vehicle emission requirements—referred to as the “electric vehicle mandate” in Trump’s EO—is to believe that the current Supreme Court would go against its West Virginia v. EPA ruling, which finds that regulators cannot govern consumer choice when it comes to purchases. That scenario is highly unlikely.

Overall, there are few examples of effective climate regulation. As we wrote after Biden’s electoral win in 2020, policymakers should not count on regulations or executive authority to deliver big emissions reduction victories since the broad implementation of climate policy that could garner such shifts is outside the capabilities of regulators.

Even if the Biden administration’s climate regulations were effective, they would still be insecure. Presidents are tempted to use regulatory and executive action to achieve their goals because it’s easier than getting their agenda through Congress. But the same things that make executive action so easy also make it vulnerable to repeal by a future administration. The president can giveth—and taketh away—by executive fiat. Political history shows that the governing party changes frequently, often as a response to dissatisfaction with the incumbent, meaning executive policies with only narrow approval are always politically vulnerable.

This is particularly an issue with climate change because the policies needed to address such a long-term problem must outlast a single presidency. Even if regulations were effective climate policies, they only work if the public tolerates them and continues to elect presidents who favor such policies.

It’s also worth noting that reliance on executive authority to impose policy without congressional approval is a relatively recent phenomenon. Regulations impose costs on the public by forcing consumers to purchase more expensive, regulatory-compliant products. Essentially, regulations are similar to inflation or taxes in that they reduce Americans’ purchasing power and/or discretionary income.

Data going back to 2005 shows that President George W. Bush’s second term generated $163.5 billion in regulatory costs. President Barack Obama’s most expensive term for regulation was his first, at $498.5 billion. Trump’s first term generated $64.7 billion in regulatory costs. But Biden’s single term generated a whopping $1.9 trillion—of which $870 billion related to vehicle emission regulations.

Central planners who favor regulation as a mechanism for climate policy ought to realize that the public’s willingness to bear significant financial burdens in the name of emission abatement is an untested concept and that the electoral success of candidates railing against regulatory burdens seems to demonstrate that Americans have little tolerance for climate regulation.

The proper pathway for durable climate policy is through Congress. Even if the laws that emerge are not as ambitious as climate hawks prefer, they are guaranteed to have gone through the steps necessary to achieve broader support from the public, thereby keeping them in force.

Many of the most successful climate policies have been implemented in exactly this manner—what the Breakthrough Institute calls “quiet climate policy.” Given that quiet climate policy is still the law of the land (while Biden’s regulations are not), the former is the more effective strategy. The same is true for Trump’s energy agenda. The first Trump administration left little lasting energy legacy, as many of its executive actions were reversed by the Biden administration—exactly what’s happening now, but in the opposite direction. Executive actions may sound good, but they’re no substitute for getting policies passed by Congress.  

The upshot is that, as much attention as Trump’s EO bonanza has already garnered, concern about its effect on Biden’s climate policies requires an exceptional amount of confidence in the ability of executive power to deliver climate benefits. The mere fact that this is the second time climate policy has been unwound in such a fashion seems to indicate that such confidence was already misplaced.