The Destructive Power of Preemption: How Congress Can Use It to Bar State Action on Climate

Yves here. Federal preemption of state statutes is hardly a new issue. For instance, interstate banking relied on this power.

Here is a perhaps-too-benign description of the theory of preemption:

Pre-emption can take many forms, including explicit pre-emption provided for by federal statute and pre-emption as a result of case law.

Also, there is the grayer area resulting from federal statutes that provide that state statutes are pre-empted to the extent they are “inconsistent” but that such statutes shall not be deemed “inconsistent” if they offer greater protection to consumers than federal law. And federal statutes will occasionally state that state law is pre-empted unless the state opts out of the regulatory scheme by a particular date.

Yves here. Note that the end of state usury laws was effectively the result of case law. Back to the earlier post:

A not uncommon development in this country has been the promulgation of consumer protection statutes at the federal level designed to address perceived abuses accompanied by explicit pre-emption of existing state statutes designed to address the same abuses, but doing so in a complicated quiltwork of 50 differently-worded state compliance requirements.

Typically, efforts to regulate a perceived abuse begin at the state level. As more and more states decide to regulate a particular activity, they create different solutions to the same nationwide problem, which in turn creates a compliance problem for the regulated industry. Thereafter, the industry typically works with federal legislators to draft a federal statute that protects consumers while recognizing the interests of the industry.

Such statutes often explicitly pre-empt state law, giving the industry the advantage of having only one regulatory system to comply with rather than 50 different state statutes.

Explicit pre-emption might also occur where state statutes are deemed to be counterproductive. For example, state usury statutes were designed to help consumers by keeping interest rates down, but sometimes set such a low ceiling that few loans were made…

Even when a federal statute does not explicitly pre-empt state law, courts can find pre-emption to exist. Such a finding often is based on the court’s reading of Congress’ intention as found in federal statute, either expressly or impliedly.

Notice that the idea of having regulations being consistent is presented as desirable, when states with weak standards are typically ones with a lot of business influence over government, including outright corruption. And its not as if the efficiency gains achieved as the result of reducing and simplifying regulation is shared with consumers. Financial services industry deregulation resulted in both growth in industry size (which we now know is a negative for economic growth) and a rise in compensation relative to average workers.

By John Upton, a Senior Science Writer at Climate Central. He has written for the New York Times, Slate, Nautilus, VICE, Grist, Pacific Standard, Modern Farmer, 7×7 San Francisco and Audubon Magazine. Originally published at Climate Central

The head of the city department that drafts many of San Francisco’s greenest rules and regulations uses one word to explain her greatest fear for the environment during Donald Trump’s presidency: “preemption.”

If some of the deepest concerns of climate-focused bureaucrats from San Francisco to Massachusetts and New York come true, the Trump administration will preemptively prevent them from acting to slow global warming.

With Trump and Republicans in Congress widely expected to unite to undermine federal environmental protections, progressive states and cities are making plans to fight global warming within their borders without being helped or required to do so by the U.S. government.

“Preemption is probably the progressive cities’ worst nightmare,” said Deborah Raphael, director of San Francisco’s environment department, which has helped city lawmakers craft rules mandating everything from greener buildings to composting and recycling by residents. “It’s also the state of California’s worst nightmare.”

The term “preemption” doesn’t describe a single legislative or regulatory tool. The word describes a concept, in which the federal government or a state imposes restrictions on the rules and programs that governments operating beneath it are allowed to implement.

Conservative lawmakers in North Carolina used a preemption law last year to outlaw transgender protections in Charlotte. In Michigan, cities and counties were barred from banning plastic bags. Colorado prevents local governments from banning fracking.

With Republicans about to control both houses of Congress and the White House, environmental experts are warning of battles ahead over potential federal preemptions.

“There really is virtually no aspect of federal regulation of the natural environment or health that’s not at risk of preemption now,” said Mark Pertschuk, a lawyer and activist with the nonprofit Grassroots Change, which tracks state preemptions of local rules affecting gun safety, paid sick days, factory farming and other issues. “Federal laws almost always trump state and local laws.”

It’s difficult to predict when, how or whether the federal government will wield any tools of preemption to bar cities and states from enforcing their own environmental rules. Nonetheless, governments across the country are bracing for new restrictions. California’s decision to hire Obama’s attorney general, Eric Holder Jr., showed it’s preparing to fight for state rights in court.

“Everything is speculative right now,” said Cooper Martin, a sustainability official at the National League of Cities, which represents cities in state capitols and on Capitol Hill. Based on Trump’s anti-environmental cabinet nominees and his rhetoric on climate change, which he has falsely called a hoax, Martin said fears of federal preemption are “certainly well founded.”

“It’s just the nature of the political landscape that this hasn’t been an issue on climate, at least in the last eight years,” Martin said, referring to the length of Obama’s presidency. “It was certainly an issue prior to that.”

Clean car rules in California, which are unpopular with oil companies and auto manufacturers, offer what may be the clearest opportunity for federal preemption. Other rules that could be blocked relate to appliance efficiency standards, power plant pollution, fossil fuel exports and safe disposal of pharmaceuticals. Local governments that have spent federal transportation funds on cycling and transit initiatives could be prevented from doing so in the future.

“Programs that allow cities to invest in bike and pedestrian infrastructure, or that allow cities to invest in transit, have all become more popular, particularly in the larger cities,” Martin said. “We want to make sure that there’s flexibility for the cities that do choose to go down this path.”

The Clean Air Act allows California to enforce stricter standards on car pollution than the federal government. It also allows other states to adopt California’s rules. But to do so, California needs a waiver from the EPA. When George W. Bush was president, the EPA refused to issue such a waiver, which was eventually granted after Obama became president.

Trump’s nominee to lead the EPA, Oklahoma Attorney General Scott Pruitt, has repeatedly sued the agency, arguing that federal pollution rules violate state rights. Now he might lead a charge to limit the rights of states to enforce their own pollution rules to slow climate change.

Within days of Trump’s election, the Alliance of Automobile Manufacturers sent the president-elect a letter arguing that the “regulatory friction” caused by two sets of car pollution standards is “driving up vehicle costs.” The automakers implored Trump to eliminate California’s far-reaching clean car rules through what they call “harmonization” with federal regulations.

“We could see the U.S. EPA refuse to grant future waivers; there’s even been some talk that they could try to strip away existing waivers,” said Bill Magavern, the policy director at the Coalition for Clean Air, a California nonprofit. “It’s safe to say California would sue in either instance.”

Michael Wara, an energy and environment expert at Stanford Law School, said the federal government could go further than car standards and try to revoke the rights of states to limit heat-trapping carbon dioxide pollution billowed by power plants. It could also jeopardize “anything that smells like foreign policy” by states, Wara said, including linkages between a carbon pricing system operated jointly by California and Quebec.

“Anything that looks and feels like a treaty — that creates binding obligations on both sides — is going to face increased judicial scrutiny,” Wara said. “Here, if there is any conflict, the state loses.”

Not all talk of federal preemption is hypothetical. Rep. Michael Burgess, a Republican from Texas, introduced a bill last week that would repeal federal efficiency standards affecting washing machines, dryers, ceiling fans, fridges and other appliances. It would also prevent states from adopting any product standards governing “energy conservation or water efficiency.”

The Heritage Foundation, an influential conservative think tank, supports Burgess’s anti-regulatory drive on appliances, but it’s worried that his bill would curtail state rights.