Trump’s Expansion of Offshore Drilling an Example of Deregulation
The Trump Administration is reportedly preparing an executive order that would lift a federal ban on drilling for oil off the East Coast and the mouth of the Chesapeake Bay.
It is the most recent of several moves by Trump to strip away environmental regulations and gut the Environmental Protection Agency. He has proposed to cut EPA’s budget by 31 percent, eliminating 3,200 positions, and terminating 50 programs nationally – including the Chesapeake Bay cleanup program.
The rationale for all this rolling back of environmental rules is that they have been allegedly killing U.S. fossil fuel industries, and in particular holding back innovative oil and gas businesses that should be enjoying more of a renaissance.
But a funny thing happened on the way to the liberation of American energy companies.
Reuters news recently reported that top U.S. oil companies have been telling their shareholders that environmental regulations actually have very little impact on their operations or financial condition. Thirteen of the 15 biggest petroleum companies reported in their most recent federal Securities and Exchange Commission filings that compliance with existing federal environmental rules did not have a “material” or significant effect on them. ExxonMobil and Chevron reported that following the regulations cost them less than two percent of their revenues.
Despite all the political hyperbole about EPA’s “job killing” regulations, the truth is that the agency does not kill jobs and is not the ogre that Trump has dressed it up to be. If overreach by Obama’s EPA was such an oppressive force on the oil and gas industry, stock prices for these companies should have skyrocketed after Trump’s inauguration. But Wall Street can tell an ogre from a red herring. While most of the stock market has surged since Trump took office, the stock prices for ExxonMobil, Chevron, ConocoPhillips and Occidental have all fallen.
Why is this? Because of continued overproduction of oil and gas – a problem that certainly will not be solved by opening up the East Coast to offshore drilling.
The bottom line here is that Trump and his allies in Congress have been pushing a false narrative about EPA and environmental regulations, in general.
Trump is proposing to eliminate not only EPA’s Chesapeake Bay and Great Lakes cleanups programs, but also agency’s climate change, lead poisoning, swimming beach protection, radon gas monitoring, runoff pollution control, and environmental justice initiatives, along with 42 others.
His new EPA Administrator, Scott Pruitt claims that cutting these federal programs will liberate and empower state environmental agencies to do a better job fighting pollution. But while this “state’s rights” argument sounds good, politically, to Trump’s base, it is also a lie.
The truth is that state environmental agencies not only need help from EPA’s regulatory authority to combat interstate air and water pollution – large portions of the state agency budgets come from EPA grants. About a quarter of Maryland Department of the Environment’s budget, for example, comes from EPA grants. Trump is proposing to slash these grants by 45 percent. So he will be crippling the very state agencies he claims he will be helping.
In the end, this is not about “state’s rights” or creating jobs. This is about a real estate developer – Trump -- fulfilling the wish lists of other developers and corporations that want to make one or two percent more profit for their already wealthy investors by freeing themselves from bothersome rules that protect the health and welfare of the rest of us....and the future of our world.