Brad Plumer - Trump signs his first significant bill - killing a transparency rule for oil companies
NB: This article, along with these: Alex Steffen - Trump, Putin and the Pipelines to Nowhere;
Why Flynn's Resignation Matters; and Who Told Flynn to Call Russia? tells us a lot about the manipulations that take place at the highest levels of political and commercial power in the contemporary world - DS
Why Flynn's Resignation Matters; and Who Told Flynn to Call Russia? tells us a lot about the manipulations that take place at the highest levels of political and commercial power in the contemporary world - DS
President Donald Trump
signed his first significant piece of legislation on Tuesday, repealing an
Obama-era rule that
forced energy and mining companies to disclose any payments they made abroad. “This is a big
signing,” Trump said,
“a very important signing.”
That part’s...
debatable. Outside of a few firms like Exxon Mobil — which once lobbied against
the rule and whose former CEO Rex Tillerson is now Trump’s secretary of state —
it’s hard to find too many people overjoyed that this regulation is dead. The real
significance here is that this marks the start of a big push by the Trump
administration to roll back a wider array of federal regulations.
Why one of Trump’s
first acts was to kill an obscure transparency rule
Since early February,
Republicans in Congress have been using a tool called the Congressional
Review Act to target a bunch of regulations that were finalized in
the waning days of the Obama presidency. Because of how the CRA works, the GOP
can basically kill any federal regulation published after June 13, 2016, with a
simple majority vote in the House and Senate - as long as Trump agrees. There are dozens of
Obama-era rules that are vulnerable to CRA repeal; Republicans have focused on
eight so far, including:
- A rule restricting coal companies from
dumping mining waste into streams
- A rule curtailing
methane waste from oil and gas drilling on public lands
- A rule that
requires publicly traded oil, gas, and mining companies to disclose any
payments they made to foreign governments, including taxes and royalties
This last rule
originated with the 2010 Dodd-Frank Act — when senators from both parties included
a provision requiring greater disclosure from mining and drilling
companies working abroad. The hope was to cut down on corruption in
resource-rich developing countries by increasing transparency.
At the time, as
Michael Grunwald reports
for Politico, Rex Tillerson was Exxon Mobil’s CEO and flew to
Washington, DC, to lobby against this provision, arguing that it would put his
company at a competitive disadvantage and make it harder to do business in
places like Russia.
Tillerson lost that
battle, and Congress passed Dodd-Frank with the provision intact. Over the next
six years, the Securities and Exchange Commission worked to craft a rule that
would give the legislation teeth. But the SEC’s first attempt at regulation was
struck down by the courts in 2012, and crafting a replacement was
a long, tangled process. The rule didn’t actually get finished until June 27,
2016 — a fateful delay that made it ripe for repeal via the Congressional
Review Act.
The American Petroleum
Institute has
argued that the disclosure rule is unnecessary — after all, it’s
already illegal for oil and gas companies to bribe governments under the
Foreign Corrupt Practices Act. These new requirements would simply add extra
costs and make it harder for US mining and drilling companies to operate
overseas. Publicly traded oil companies like Exxon Mobil were
also concerned that the disclosure forms would reveal valuable
information about individual projects, giving their state-owned and privately
held competitors an unfair advantage.
Anti-corruption groups
and other supporters of the rule, for their part, argued that the provision
wasn’t substantially different from similar requirements in Canada and Europe.
Foreign companies like BP and Royal Dutch Shell now regularly report taxes,
bonuses, and other payments to foreign governments. Why shouldn’t American oil
majors like Chevron and Exxon Mobil?
“The US had been at
the forefront on the transparency issue, with more than 30 countries following
in its footsteps to pass similar legislation,” said Isabel Munilla of Oxfam
International in a statement after the House initially voted to kill the rule.
“State-owned companies from Brazil, China, and Russia are all now required to disclose
their payments. If the Senate follows suit in overturning this rule, the US
will go from a leader into a laggard.”
But the oil industry
won this fight. The House and Senate GOP both voted to disapprove of the rule,
and Trump just signed their bill. The regulation is now null and void. That
said, there is one lingering issue: Under the Congressional Review Act, the SEC
is barred from crafting a new rule that has “substantially the same form” as
the repealed regulation. But Dodd-Frank also technically still
requires the SEC to come up with a transparency rule. The CRA has only been
used once before, so it’s unclear how this might play out in future litigation.
This is only the
beginning of Trump’s deregulation agenda
These Congressional
Review Act repeals are low-hanging fruit — something the House and Senate can
do very quickly to roll back certain Obama-era rules. So far, they’ve voted to
repeal eight such regulations, and dozens more could be on the chopping block
in the weeks ahead.
But Trump is planning
much, much more. As Juliet Eilperin reported recently
for the Washington Post, his administration is contemplating the most
aggressive rollback of federal regulations since Ronald Reagan. On January 30, Trump signed
an executive order that required federal agencies to repeal two
regulations for every new one that gets issued. This order is likely to prove
messy and in some cases unworkable, but experts think it will at minimum deter
federal agencies from being quite so assertive on the regulatory front as they
have in the past. The White House has also delayed a number of smaller
regulations in the works, such as postponing a
move to list the bumblebee as an endangered species.
Some of Trump’s
cabinet officials are likely to go even further once they get confirmed. Scott
Pruitt, the nominee to head the Environmental Protection Agency, is
widely expected to try to scale back Obama-era climate policies
like the Clean Power Plan, which aimed to reduce carbon-dioxide emissions from
power plants. While rewriting agency rules is a complicated and fraught process
— it’s much, much harder than using the CRA — Pruitt has a fair bit of leeway
here.
http://www.vox.com/2017/2/14/14617312/trump-transparency-oil