Trump Is Right to Ditch the California Auto Waiver

The Editors

The Trump administration is pushing ahead with a plan we endorsed previously. It will revoke California’s ability to set separate greenhouse-gas standards for cars — so that a single policy will apply to the entire country, and so that California can’t use the threat of a bifurcated regulatory regime to influence that policy in a way other states cannot.

We are fans of federalism. But Congress, understandably not wanting automakers to have to comply with 50 different sets of regulations, has generally preempted state regulation in this area — with the exception that California, and California alone, may apply for a waiver to create its own emission rules to address “compelling and extraordinary conditions.” Other states may then adopt these rules if they choose.

“Compelling and extraordinary conditions” was intended as a reference to smog. And in contrast to Californian smog, there is nothing compelling and extraordinary about Californian climate change. Climate change is happening to the rest of the country (and indeed the world) too, and climate change is what the state’s greenhouse-gas rules — as opposed to policies regulating other emissions — address. Thus the legal basis for the waiver does not apply here.

Further, under the Obama administration, California leveraged the car industry’s desire for a single regulatory regime into an agreement with the federal government, under which the nationwide regulations would reflect California’s priorities. As a result, car buyers nationwide had to pay extra for vehicles meeting the state’s preferences. No single state should have such power.

The waiver needs to go. And the Trump administration should continue with the other element of its plan too: nixing Obama-era rules that required fuel economy to hit nearly 55 miles per gallon on average by 2025, a far-fetched goal that could force car companies to sell electric vehicles at a loss to bring down the average fuel economy of their overall fleets. Freezing the standards after next year, as the administration plans to do, could reduce the future price of a car by thousands of dollars — and also reduce motor-vehicle fatalities, because one way carmakers increase fuel efficiency is to make cars lighter and more dangerous.

It’s important to note that nothing in either policy change stops companies from making more fuel-efficient cars if Americans want to buy them. In fact, several carmakers have already struck a deal with California to follow the state’s higher standards whether or not the waiver continues. The Trump administration questions the legality of the pact, but the agreement will help these companies appeal to customers who are willing to pay for fuel economy, and also reduce the stakes of any future court battle over the waiver.

It’s fine for car companies to go above and beyond what’s legally required of them. But the government should not force the industry to meet unreasonable standards, force customers to pay for it, or allow California to set national policy.

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