With all elections, we must recognize there are a multitude of factors that determine the results. Despite the consistent success delivered by the Trump administration in energy and environmental policy, Joe Biden has secured the necessary votes in the Electoral College to officially seal President Trump’s fate as a one-term president. Now that the dust has finally settled, the question is, how will the oil and gas industry be impacted?
Lessons Learned from the 2020 Election
For starters, what did we learn from the electorate? The record turnout must be acknowledged. More than 156 million ballots were cast. Turnout was more than 6% higher than in 2018 and more than 8% higher than in 2016. The turnout rate is estimated to be 66.5% of eligible voters, the highest since 1900, according to the United States Elections Project.
In addition to higher turnout, all fundraising records were shattered this cycle. The total cost of the 2020 election will reach a mind-blowing $14 billion, making it the most expensive election in history and twice as expensive as the previous presidential election cycle. Democrats outspent Republicans 65:35.
The base of both parties shifted. Trump over performed with Hispanics and African-American men, while Biden clawed back pockets of white men with no college degree, especially in the rust belt.
There was no blue wave like the Democrats had hoped (and predicted). Republicans made gains in down-ballot races and captured or retained power in many state legislatures. To the extent there were issues that drove the electorate, it was COVID and the economy. For many, however, the focus was at the top of the ticket where the true passion was either being for or against Donald Trump.
Both parties, it appears, are in the midst of a civil war over their identities and leadership. At 78 years old, Biden is a caretaker for the Democrats and will have a tough time keeping everyone together, especially with the progressives tugging at him so hard to the far left. And the populism awakened by Trump is hardly going anywhere. Further, Mr. Trump has no intention of relinquishing the spotlight in the Republican Party, so expect tensions within the GOP to remain high as well.
But by far, the biggest losers in this cycle were socialism, the polling industry and the media, particularly the cable news networks.
Until the pandemic, the United States had become the world’s preeminent energy superpower. Over the full course of 2019, the U.S. exported oil to more than 40 countries, fully eliminating the long-held concern about foreign oil dependency. In January 2020, the U.S. produced 13 million barrels per day of oil — an all-time record. The U.S. was producing more oil and gas than any other country, ran an energy export surplus, and has reserves that can fuel us for generations. Unfortunately, a Biden administration will now start its dismantling of the gains made during the last four years.
As goes the adage in Washington, personnel is policy. When I served as President Trump’s Department of Energy transition team leader following the 2016 election, I saw first-hand how much power is held in the hands of a few appointees.
Despite all the obfuscations, Joe Biden has shown how he will use his position through his selection of his vice president and his team of energy and climate advisors. The names that stand out politically are John Kerry, who gave away our energy sovereignty at the Paris climate meetings, and Gina McCarthy, the head of one of the most powerful environmental-activist groups in the country — the Natural Resources Defense Council (NRDC) — and one who reached a new political low by abusing the COVID-19 pandemic by implying changes in air-quality regulations would force tens of thousands of Americans to die unnecessarily. Biden recently named Jennifer Granholm, the former governor of Michigan and a champion for electric vehicles and renewable subsidies, as his Energy Secretary.
Biden has also named North Carolina regulator Michael Reagan as his pick for EPA Administrator, Rep. Deb Haaland (D-NM) as Interior Secretary, and Brenda Mallory, a lawyer for the hard-left Southern Environmental Law Center as his Council on Environmental Quality (CEQ) Chair. Though lesser-known, these picks are expected to toe the green line. Remember, the household names aren’t necessarily the ones who will do the most damage.
Biden will have the proverbial pen and phone at his disposal, a tool clearly against the letter and spirit of the Constitution, and is likely to engage in executive overreach, even going so far as to join the “Great Reset” movement aimed at dismantling free markets.
January 20, 2021: Biden on Day One
First up, Biden will recommit the U.S. to the Paris Climate Agreement. Under Biden’s plan, the U.S. will unwisely restrict our own industrial output while China, the largest polluter in the world, will continue to expand its own. Biden proudly touts that he worked with the Chinese government during his stint as vice president to get the Paris Agreement to the finish line. Jumping back into the Paris Agreement means handing the reins of global industry to China.
Here in the U.S, Joe Biden will look to block or slow to a crawl oil and gas development on federal lands and in federal waters. Several states will be impacted immediately — New Mexico, Colorado, Utah, and Wyoming.
Governor Mark Gordon of Wyoming was wise to get ahead of this issue, along with approval and funding from the legislature, requesting the University of Wyoming study the state impact if Biden makes good on his promise to end or restrict oil and gas production on federal lands. Overall, the western U.S. could lose $670 billion over 20 years. It would be devastating, to say the least.
By his own account, Biden will sign a series of new executive orders with an unprecedented reach that goes well beyond the Obama-Biden administration’s platform on squeezing out oil and gas. His overarching goal is the complete elimination of oil and gas from our economy by 2050 and will likely draw from some of the awful ideas we’ve seen come from California, like banning the internal combustion engine.
Just as we saw in the latter Obama years, the Biden administration will restore the horrible practice of “sue and settle” lawsuits. In these lawsuits, organizations that support the administration’s green agenda to reduce the availability of affordable, reliable domestic energy sue-friendly agencies in order to achieve out-of-court settlements that meet both groups’ goals, without the usual scrutiny of the judicial system or regulatory transparency. This phenomenon changes regulation and administration of law and is particularly pernicious in that it undermines basic due process by disregarding administrative procedure and avoiding judicial review. Much damage can be done to the Rule of Law and economic liberty as a consequence of these suits.
And, of course, under the guise of environmental justice, expect Biden policies across all federal agencies that claim to be aiding the poor and minorities, while in reality, harming them the most.
A House of Cards
As expected, the House of Representatives remains under Democratic Party control, but not by much. What was predicted to be a multi-seat gain for the Democrats has resulted in a 12-seat loss. And it is here that we will see the battle for the soul of the Democratic party play out. Will the celebrity socialists win the day, or will voices of moderation rise to the occasion and temper the worst instincts of the left? Even if Speaker Nancy Pelosi keeps her powerful position, she will do so with the narrowest of majorities in modern politics.
That’s not to say there aren’t some reasonable members in the House. In particular, Democrats in energy-producing districts will likely be the oil and gas industry’s most useful allies. It’s a perfect example of why we created the American Energy Scorecard, the first and only free-market congressional energy accountability dashboard. It educates lawmakers about the most important energy votes of the year and empowers the American people to hold their elected officials accountable for the decisions they make in Washington.
In 2020, all 74 House Energy Champions and 12 Senate Energy Champions up for re-election appear to be returning to Washington. And we highlighted some members from energy districts with abysmal scores, like Representatives Kenda Horn (D-OK), T.J. Cox (D-CA), Xochitl Torres Small (D-NM), and helped send them home with election defeats.
Not to mention, the clock is already ticking for the 2022 midterm elections. If the oil and gas industry doesn’t publicize bad votes cast by representatives from energy-producing districts, then they only have themselves to blame.
All Eyes on Georgia
Despite Joe Biden’s election to the White House, it appears the Senate Republicans have managed to hold onto the upper chamber of Congress. We’ll know officially after the special election taking place in Georgia on January 5th, 2021.
Should Republicans hold control, this result validates Majority Leader McConnell’s decision to move forward with the confirmation of Supreme Court nominee Judge Amy Coney Barrett and proves that the people of the United States want to build upon our strengths of limited government and free enterprise, despite the president having been voted from office. It also means that Biden will be the first newly elected Democratic President without a Democrat-led Senate since Grover Cleveland in 1884.
The Republican majority in the Senate will be in a very important role, serving as the stronghold and last line of defense against the tide of regulatory and legislative shenanigans that will emanate from the House of Representatives and the Executive Branch. And they’ll determine the pace in which President-elect Biden’s appointees are confirmed or denied.
Musical Chairs in the Senate
Because Republicans place six-year limits on committee chairmanships, we’ll see some important changes in the Senate. Sen. Lisa Murkowski (R-AK), chair of the Energy and Natural Resources Committee, will hand the gavel off to Sen. John Barrasso (R-WY). Barrasso, currently the chair of the Senate Environment and Public Works Committees, will then likely hand his gavel over to Sen. Shelly Moore Capito (R-WV).
Again, this is all predicated on the expectation that Senators David Perdue or Kelly Loeffler of Georgia win their special election and are returned to Washington. If either one wins, that will prevent Sen. Chuck Schumer (D-NY) from becoming the new Senate Majority Leader and giving the Democrat party control of the administration and Congress, just as they did in 2009.
Regardless of the Senate outcome, Biden will be limited by time, and he will have detractors like us to contend with. If we’ve learned anything in the last ten or so years since Obama and Biden controlled the executive branch and extreme environmental activism started to take hold, it’s that the green left can be stopped. It all comes down to this: doing the necessary and unloved work of telling the truth about energy rather than following the media and politician-driven myths and doomsday talk.
About the author: Thomas J. Pyle is the president of the Institute for Energy Research (IER), an energy think tank and the American Energy Alliance (AEA), a not-for-profit that engages in grassroots public policy advocacy and debate concerning energy and environmental policies at both the state and national level. He served as head of transition for energy under President Donald J. Trump.