Trump administration

Executive Orders Could Give New Hope to Coal Terminal

Recent executive orders signed by President Trump seek to relax federal rules that have been used by states such as Washington to block fossil fuel export terminals, sparking speculation the proposed coal export terminal in Longview could be resurrected.

Recent executive orders signed by President Trump seek to relax federal rules that have been used by states such as Washington to block fossil fuel export terminals, sparking speculation the proposed coal export terminal in Longview could be resurrected.

A coal terminal in Longview, Washington may not be fully buried and gone, according to Carl Segestrom, an editorial fellow at High Country News.

In a piece carried by Mother Jones, Segerstrom speculates that Trump administration executive orders issued April 10 could lead to a rewrite of Section 401 rules under the Clean Water Act. States and tribes rely on existing rules to deny permits for facilities that release pollutants into federally protected waters such as the Columbia River.

“Trump’s directive declares that the current process ‘cause(s) confusion and uncertainty, leading to project delays, lost jobs, and reduced economic performance,’” Segerstrom asserts. The administration’s goal, he adds, is to tip the scales more in favor of extractive industries and away from states such as Washington and Oregon that have blocked fossil fuel export facilities.

“In the name of energy dominance, the federal government is looking to curtail state environmental reviews and promote fossil fuel exports. By doing so, it’s wading into an ongoing fight between coastal and Interior West states over permit denials for export facilities on the West Coast,” he writes. 

The effort to locate a 44 million ton coal expert facility in Longview was blocked when the Washington Department of Ecology declined to issue a water quality permit as required under Section 401 of the Clean Water Act.

The effort to locate a 44 million ton coal expert facility in Longview was blocked when the Washington Department of Ecology declined to issue a water quality permit as required under Section 401 of the Clean Water Act.

Segerstrom questions whether the federal Environmental Protection Agency will weaken rules enough to resurrect the proposed 44 million ton Millennium coal terminal in Longview. While he doesn’t say so directly, turnover in the White House after the 2020 election could scuttle the rule changes Trump seeks.

The Washington Department of Ecology denied Millennium a water quality permit In September 2017, citing Section 401 rules intended to protect federal waterways. US District Court Judge Robert Bryan rejected an appeal last month that argued the water quality permit denial interfered with the Constitution’s Commerce Clause provision.

Energy industry officials and elected officials from energy-producing inland states have pushed for rule changes that will give them an opportunity to site West Coast terminals to export crude oil, liquified natural gas, propane, methanol and coal to Pacific Rim markets. They argue these fossil fuel exports will in many cases substitute for fuels that produce higher level of greenhouse gas emissions. They also say the exports occur anyway through US ports on the Gulf of Mexico, resulting in longer, more expensive ocean trips to their Asian destinations. 

Fossil fuel export terminals have failed to gain critical Clean Water Act permits, but there are other objections that have played a role, most notably concern over more unit-train traffic and a heightened threat of spills and explosions.

Segerstrom cites Diane Dick, a Longview activist who has fought the coal terminal for nearly a decade. “From the beginning, she said the fight over the terminal felt bigger than just one project; she’s watched it become a poster child for a national debate over energy infrastructure. Now, as the executive branch tilts the scales against local environmental protection, Dick sees a larger question looming: When and based on what can a community protect itself?”

 

Best Bipartisan Opportunity: Lowering Prescription Drug Prices

The best opportunity in a fractious Congress for bipartisan legislative success appears to be in an effort to curb prescription drug prices, which critics say are higher than charged in other Western countries and are forcing some Americans to ration prescriptions or even avoid treatment.

The best opportunity in a fractious Congress for bipartisan legislative success appears to be in an effort to curb prescription drug prices, which critics say are higher than charged in other Western countries and are forcing some Americans to ration prescriptions or even avoid treatment.

If a bipartisan deal is going to be struck this year, it will deal with lowering prescription drug prices, according to an Axios report.

“The White House and top lawmakers from both parties think a bill to lower drug prices has a better chance of becoming law before the 2020 election than any other controversial legislation,” says Caitlin Owens of Axios. “Republican politics on drug prices have changed rapidly. The White House has told Democrats it has no red lines on the substance of drug pricing – a position that should leave pharma quaking.”

The only red line for the White House is tying drug legislation to revisions of the Affordable Care Act. But Trump officials have given the green flag to using Medicare negotiations as leverage to lower drug prices.

Axios indicates momentum is growing for legislative action before the August recess, viewed by many as the last fertile moment for compromise before the start of the 2020 presidential election political desert when nothing can get approved. Bills are already moving in Congress aimed at influencing drug prices by limiting extended monopolies and expanding access to generic prescription drugs.

Republicans are introducing bills that previously would have been viewed as liberal. Texas Senator Mike Cornyn proposes giving the Federal Trade Commission the power to bring antitrust suits against pharmaceutical companies that use patents to discourage competition. House GOP leader Mark Meadows is part of a bipartisan group exploring a proposal to tie Medicare reimbursement rates to the international price of prescription drugs. Florida Senator Rick Scott introduced legislation preventing US drug companies from charging higher list prices than in Canada, France, Britain, Japan and Germany.

This spate of activity around drug pricing has put the pharmaceutical industry on high alert. Drug company officials have warned proposed legislation could slow investments in promising new drug treatments and upset the “pharmaceutical ecosystem.” That is an appeal aimed at President Trump who has expressed strong support for drug therapy advancement. 

Getting anything of significance accomplished in Congress is never easy. Partisan fights over what to do in response the Mueller report, health care and border security could derail any bipartisan effort on prescription drugs. The embrace by Democrats for a single-payor Medicare for All system could be a particular problem in that it could exacerbate the existing price differences between Medicare and private health insurance.

“Anything that gets done would need to be passed before the August recess, which itself is growing more unlikely as time passes and fights over the ACA and other issues erode whatever bipartisan collaboration that might have existed," a former Trump administration official told Axios.

The prospect of legislative action on drug pricing, supported by the Trump administration, has taken its toll on the stock prices of major pharmaceutical companies – and sharply lowered the multi-million compensation of their CEOs.


Big News Comes Under Small Headlines

An unremarkable resolution promoting breastfeeding provoked a stunningly aggressive action by a US delegation to throttle it, at least until the Russians stepped in to salvage the resolution.

An unremarkable resolution promoting breastfeeding provoked a stunningly aggressive action by a US delegation to throttle it, at least until the Russians stepped in to salvage the resolution.

Sometimes the most revealing stories are the ones with small headlines reporting on events occurring in the shadows. Such as the stories reporting the United States aggressively sought to block a global resolution backing breast-feeding and deleting language favoring soda taxes to reduce obesity.

In both cases, the US position appeared in alignment with positions advocated by infant formula manufacturers and soda producers. Perhaps ironically, Russian delegates stepped in to preserve the global resolution backing breast-feeding. The delegates said they based their decision on “principle.”

Research solidly supports breast feeding, which makes the US position at the World Health Assembly in Geneva all the more puzzling and stunning to delegates from around the world, according to The New York Times

This wasn’t a friendly disagreement. Ecuador offered the resolution and the American delegation threatened to “unleash punishing trade measures and withdraw crucial military aid,” the Times reported. Ecuador capitulated.

“The showdown over the issue was recounted by more than a dozen participants from several countries, many of whom requested anonymity because they feared retaliation from the United States,” the Times said. Other nations balked at requests to offer a substitute resolution in the wake of the US action. At least until Russia stepped in. The US delegates didn’t threaten the Russians.

Delegates were reportedly stunned by the “intensity” of the Trump administration’s opposition. They pointed to the $70 billion global baby food industry lurking in the shadows of the assembly. They also noted the Trump team’s position was diametrically opposed to the position expressed by the Obama administration.

“We were shocked because we didn’t understand how such a small matter like breast-feeding could provoke such a dramatic response,” an Ecuadorean official, who asked not to be identified because she was afraid of losing her job, told the Times.

At the same assembly, US officials successfully throttled a statement supporting soda taxes. That position squares with a Trump effort in NAFTA negotiations to limit Mexico’s and Canada’s ability to require labels on sugary beverages.

“The [US] delegation’s actions in Geneva are in keeping with the tactics of an administration that has been upending alliances and long-established practices across a range of multilateral organizations, from the Paris climate accord to the Iran nuclear deal to NAFTA,” the Times summarized.

The Trump administration has threatened to cut its $845 million contribution to the World Health Organization, which represents 15 percent of the group’s total budget.

“It’s making everyone very nervous, because if you can’t agree on health multilateralism, what kind of multilateralism can you agree on?” said Ilona Kickbusch, director of Global Health Center.

 

Zig-Zagging Trump Trade Policies Put Northwest on Edge

Trump trade policies seem destined to trigger a global trade war, which could have a serious economic impact on the Pacific Northwest that relies heavily on export of airplanes, machinery, technology, agricultural products and services. Disrupted trade also could harm  manufacturers with supply chains throughout the Pacific Rim.

Trump trade policies seem destined to trigger a global trade war, which could have a serious economic impact on the Pacific Northwest that relies heavily on export of airplanes, machinery, technology, agricultural products and services. Disrupted trade also could harm  manufacturers with supply chains throughout the Pacific Rim.

The Pacific Northwest is especially dependent on international trade and the threat of a global trade war has many business leaders on edge. Perhaps none more so than at Daimler Trucks in Portland that employees more than 2,000 workers who are mostly engineers.

Despite some mixed signals, President Trump has moved ahead to impose a 25 percent tariff on imported steel and a 10 percent on imported aluminum. He also has singled out Mercedes-Benz for an outright ban on imports, citing national security and his personal angst at seeing New York’s Fifth Avenue clogged with the popular German luxury car.

Mercedes-Benz manufactures SUVs, GLE coupes and C-class cars at its Tuscaloosa, Alabama plantBMW manufactures luxury cars in Spartanburg, South Carolina, which the company says produces 1,900 vehicles per day, the highest daily output of any BMW car plant in the world. Spartanburg is the exclusive manufacturing site for BMW’s X-class vehicles, which are exported worldwide.

For Oregonians, a greater concern would be the impact of Trump’s tariffs on Daimler Trucks, which maintains its North American headquarters in Portland. Much of the company’s truck manufacturing has been shifted to the Southeast and Mexico. What largely remains in Portland are corporate teams and engineers “designing the future of commercial vehicles.”

Daimler Group is the corporate parent for Mercedes-Benz Cars and Daimler Trucks.

President Trump has singled out German car manufacturer Mercedes-Benz, which is a sister company to Daimler Trucks that manufactures and designs commercial vehicles at its North American Headquarters in Portland

President Trump has singled out German car manufacturer Mercedes-Benz, which is a sister company to Daimler Trucks that manufactures and designs commercial vehicles at its North American Headquarters in Portland

Officials at Daimler aren’t alone in fretting about fallout from a potential trade war. The Seattle Times quoted officials from the aluminum and agricultural sectors, as well as union officials, raising alarms about impacts from tariffs on multi-country supply chains, direct exports and price increases that could affect everything from Boeing airplanes to new housing. A Seattle homebuilding official said higher tariffs on steel could increase the price of a new house by up to $5,000.

Depending on how China and the European Union impose reciprocal tariffs, emerging markets pursued by Northwest exporters such as winemakers could be squeezed. Tariffs slapped on by Mexico and Canada also could have disruptive effects.

In addition to the tariffs, what baffles and irks US trading partners is the unpredictability of Trump's trade policy, if it can be called a trade policy. Negotiations occur, agreements are reached and then Trump goes in a different direction, as he did with the bilateral trade deal struck with South Korea and with the Chinese talks two weeks ago.

Trump’s trade steps also raise hackles on Capitol Hill. Many Trump supporters were stunned when he agreed to back off punishment that the Chinese said could force the collapse of ZTE, a huge telecom company facing charges of ignoring US export sanctions imposed on North Korea and Iran. A Texas court fined ZTE $1 billion and ordered it could not receive any US-made components and software for seven years.

EU officials, who share US concerns about restrictive Chinese industrial policy and alleged intellectual property theft, have urged the Trump administration to form a united front on policies and negotiations aimed at winning major concessions from the Chinese.

However, Trump’s mistrust of multilateral arrangements appears to drive his actions. Despite warnings from economists, Trump has put trading relations with Canada, Mexico, China, South Korea, Japan and the European Union in a state of flux. Reciprocal tariffs are being imposed and talks about updating existing trade deals have stalled.

Trump’s nationalist trade policy may win applause in steel-producing states, but could trigger discontent and growing fears of an economic slowdown in the rest of the country as crucial midterms approach this fall that will determine who controls Congress for the next two years.

Tax Bill: Regular Order and No Border Tax

White House, GOP congressional leaders agree on process to write a tax bill and move it through the House and Senate under regular order – without the Trump administration’s proposed border adjustment tax.

White House, GOP congressional leaders agree on process to write a tax bill and move it through the House and Senate under regular order – without the Trump administration’s proposed border adjustment tax.

In contrast to GOP efforts to repeal and replace Obamacare, Republican congressional leaders plan to move tax legislation in regular order, which means starting with a bill and working it through committees. They also plan to put aside the Trump administration’s proposed border tax.

The news came in the form of a joint statement from the White House, House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell. This is viewed as an olive branch to Democrats to play a role in shaping, at least at the margins, of tax legislation.

The basic goal of the legislation remains the same – to promote economic growth and American jobs. Core ideas will be to lower tax rates and simply the tax code. “The goal is a plan that reduces tax rates as much as possible, allows unprecedented capital expensing, places a priority on permanence and creates a system that encourages American companies to bring back jobs and profits trapped overseas,” the statement read.

The flash points, as always, will be who benefits most from lower tax rates and how expected federal revenue losses will be offset. The statement didn’t offer any specifics, but junking the border tax idea, which would have taxed imports and exempted exports, removes one of the main ways the Trump administration proposed to offset revenue losses. That will make it harder to squeeze a tax cut into a budget.

In its statement, GOP leaders talked about “tax relief for American families” and helping small US businesses compete with larger business and larger business compete with foreign businesses.

Dropping the border adjustment tax, known as BAT, comes amid questions about its actual impact and the long-term consequences of shifting to a national consumption tax. Supporters claim it would bolster US manufacturing. Critics contend it could curtail US exports, raise prices for American consumers and possibly even spark a trade war.

There had been some thought that congressional Republicans would try to use the budget reconciliation process to move a tax measure. The health care legislative mess undoubtedly discouraged that thought. Republicans also believe there is willingness among some Senate Democrats to play ball on tax provisions. And they hope to have a more unified voice from business interests, if not others, in support of a tax code update. Inclusion of a border tax would have splintered the business community and probably doomed the legislation to vocal opposition from consumer groups.

No time table or specific provisions were included in the statement, but working through both House and Senate tax-writing committees will take time for public hearings, mark-up sessions and floor debates, not to mention an eventual conference committee to iron out differences. It is unlikely that serious work on tax legislation will start before lawmakers return from their August recess.