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As Democrats face an uphill battle to this year's midterm elections, which energy and environment initiatives will pass in 2010? During today's OnPoint, David Weinberg, chairman of the Environment & Safety Practice at Wiley Rein, discusses a new report focusing on the Obama administration's environment and energy plans for the year. Weinberg explains why he believes cap and trade will not pass because of manufacturing states' concerns. He also discusses the administration's shift from favoring legislation to focusing on regulation.
Monica Trauzzi: Welcome to the show. I'm Monica Trauzzi. Joining me today is David Weinberg, chair of the Environment and Safety Practice at Wiley Rein. David, it's nice to see you again.
David Weinberg: Oh, thank you, welcome, good to be back.
Monica Trauzzi: David, Wiley Rein just released a report focusing on environment and energy initiatives for the second year of the Obama administration. Cap and trade is the big unknown for 2010 and you believe the overarching reason why we won't see cap and trade happening this year is because of manufacturing states and concerns that those states have. That said, there are some other options for Democrats here. One of those would be an energy only bill. What route do you see this taking this year?
David Weinberg: I think the future is regulation more than legislation in this area probably. The paper that we released and that is available on our web site addressed a whole series of various in which we see the focus in the second year of the Obama administration being regulatory. Now, we wrote our piece on the cap-and-trade bill before the Massachusetts election of course and even at that time my partner, Mike Bloomquist, who wrote that piece, was able to say that the administration had a very tough time facing it because of the jobs concerns of the manufacturing states, senators such as Senator Bayh and others who could see this as a real jobs problem. With the outcome in Massachusetts it seems to me that the likelihood of a cap-and-trade legislation getting through the Congress this year is real slim. Now, there's still some opportunities on the energy efficiency and energy side. If you think back a year, a year and a half ago, the early versions of what now are the cap-and-trade bills really were the energy bills coming out of the energy committee of the Senate and the House. I think we'll see a little more revival of those and we're also going to see activity on the regulatory side involving all these issues. EPA obviously has its rulemaking pending after the Massachusetts case, ironically the Massachusetts case I suppose. We also have seen a recent memorandum of understanding between EPA and DOE which is going to accelerate attention to energy efficiency on consumer products and see some new standards and some new aggressive activity there. We talk about all those things in this paper, but those are the places we think we're going to see the most activity. The legislative forum, it's hard to see anything real dramatic happening. The regulatory forum, however, I think we've just begun to see the level of activity that will emerge.
Monica Trauzzi: But speaking of regulation of emissions by EPA Senator Murkowski has essentially proposed to overturn EPA's endangerment finding. Does that proposal have legs and, if so, what does that mean down the line? Might we find ourselves in a position where we have no regulation from EPA or through legislation?
David Weinberg: Whether that legislation has legs or not it's a little early to tell and this is changing on a day-to-day basis. But for the legislation to take effect the president would have to sign it and I think it's unlikely that the president would sign legislation that blocks EPA from proceeding along the way that EPA has proposed. Now, whether the EPA proposals as implemented can withstand court challenge is a whole separate question and there are some very serious questions about trying to use essentially the round peg of the Clean Air Act to deal with the square hole, if I can put it that way, of climate change. But I don't think regardless of what the Congress does on that particular legislative proposal, I doubt that EPA is going to back off its aggressive effort to try to use the Clean Air Act to go forward on climate change activity.
Monica Trauzzi: Do you think the president will try to use this year's State of the Union address to sort of reframe the climate issue and move away from the push for cap and trade in the Senate?
David Weinberg: Well, you know, State of the Union addresses are kind of an interesting thing. From the standpoint of people inside the government, just getting the president to mention your program in the State of the Union address is a wonderful thing. And there will be lots and lots of efforts from that regard around town over the next 10 days or so. The president is sure to say something about this and he's sure to signal something about where the administration is going. But I frankly suspect we'll see more in the State of the Union on jobs and economic issues, which seems to be where the administration wants to focus attention in the coming year, than we are on the details of any of these environmental issues.
Monica Trauzzi: You believe though, as you say in the paper, that this is going to be an active year for these issues. But ahead of the 2010 elections, do you think we're going to see a slowdown because of concerns about voters and what they're thinking?
David Weinberg: I don't think on the regulatory front you are. You have to keep in mind that it took the president the better part of last year to get his second-tier policy appointees in place. Those folks are now just about all in place. Those people have agendas consistent with the president, but they have agendas as to what they think needs to be done in their areas of concern. If we look at EPA we've seen an enormous number of proposals coming out of EPA in the last six months. There are going to be more. We see it all over the government and we see these so-called listening sessions being held, which are going to lead to more activity. EPA has one coming up on storm water rules for example. OSHA has just announced a session next month over what is it OSHA has been doing right or, if you are somewhat more cynical, what is it they've been doing wrong so that they can get a mandate to do more and go forward. We'll see lots more of that activity, lots more rulemaking proposals and I think for those in the corporate sector and the trade association sector it's going to be a real challenge to both anticipate what's coming down and then react in an appropriate way. Most of the trade associations knew how to deal with the transition. There were a lot of papers written on policy issues that went into various offices of the government. The Obama people looked at those and they have taken some ideas from those. They've taken a lot more ideas from noncorporate entities than they have from corporate entities, but we're going to see more and more of that kind of opportunity and it's that kind of thing that the companies and trade associations are going to have to pivot to be able to deal with.
Monica Trauzzi: So, one year into the administration what changes have you seen in EPA compared to the Bush administration, just on pace and the types of regulations?
David Weinberg: We've seen a reconsideration, a wholesale reconsideration of a lot of decisions made in the Bush administration. They range from matters in the pesticide world, things like disclosure of ingredients in pesticides to reconsideration of monitoring standards for air emissions and lead to revisitation of the ozone standard. Virtually in every area of EPA they're going back and re-looking at issues that although they had been thought about and perhaps acted on to some extent in the Bush administration, hadn't had the activist agenda that the Obama appointees are bringing to it.
Monica Trauzzi: OK, we'll end it right there. Thank you for coming on the show again.
David Weinberg: My pleasure, thank you.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
[End of Audio]
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