If you have been wondering how, from a practical standpoint, Donald Trump plans to fulfill his pledge to “make America great again,” his cabinet selections couldn’t convey it any more clearly. It’s energy, energy, energy.
Secretary of state? The CEO of Exxon Mobil.
Secretary of commerce? A longtime investor in steel and coal companies (among other industries).
The U.S. has the world’s largest oil reserves. But that statistic is only meaningful if techniques such as fracking can be used to reach them; otherwise, we fall a few spots — and many billions of barrels — down the list. Democratic opinion has been split on the issue but trending away from support for fracking. Republicans have had no such reservations, and now Trump seems poised to supercharge the energy boom that was responsible for a disproportionate share of job growth in the first years of the recovery.
There are already signs that left-wing activists want to turn the Trump cabinet confirmation hearings into a debate about climate change, starting with State nominee Rex Tillerson. If Democrats’ goal is to sink an actual nominee or two, rather than simply placating some of their political allies, they couldn’t be more wrong about how to do it — or why it’s Trump, rather than Hillary Clinton, who’s forming a cabinet in the first place.
I recommend this piece from last week by National Journal’s Josh Kraushaar on why environmental issues may have helped undermine Clinton’s candidacy. The gist is here:
“(T)he most glaring problem for the Democratic Party is an unwillingness to even entertain the possibility that its policy agenda had anything to do with its stunning defeat. Even Republicans, thanks to their national committee’s ‘autopsy report’ in the aftermath of Mitt Romney’s loss, concluded that the party had to take a more moderate stance on immigration to win future elections. Democrats have done no similar soul-searching.
“Let me offer a piece of unsolicited advice, one that Democratic strategists have discussed privately but are reticent to promote publicly for fear of alienating green activists. Taking a more moderate stand on energy policy — whether it’s supporting the Keystone XL pipeline, championing the fracking boom that’s transforming regional economies, or simply sounding a more skeptical note on the Obama administration’s litany of environmental regulations — would do wonders for the Democratic Party’s ability to compete for the working-class voters who have drifted away from the party.
“If the GOP gains in the Midwest were an anomaly, perhaps Democrats could afford to cater to their environmental base. But this wasn’t the first time that Democrats lost significant ground in the region. In 2010, they lost a whopping 63 seats in the House in part because of failed cap-and-trade legislation; over one-third of the seats they lost were in the Midwest. Republicans amped up their attacks on Obama’s environmental policies during the 2014 midterms — airing more than 26,000 spots citing the Environmental Protection Agency — and swept nearly every competitive Senate race on their way to the majority.
“Take the Keystone XL pipeline as a stand-in for voter sentiment on the balance between protecting the environment and producing jobs. A March 2014 Pew Research Center poll, conducted during the Keystone debate, found that a 49 percent plurality of Democrats supported building the pipeline — even though the president and top party leaders opposed it. Among working-class Democrats (those who made less than $50,000 a year), support for the Keystone project outdistanced opposition by a whopping 22 points (54 to 32). When your party’s own voters are at odds with its elite, it’s a recipe for disaster. Donald Trump’s Midwestern sweep was the culmination of these long-standing trends.”
This is easier said than done. Who was the No. 1 donor in the 2016 cycle? Environmental activist Tom Steyer, whose $67.5 million was more than 17 times the amount given by the oh-so-nefarious Charles Koch (whose brother, David, didn’t crack the top 100 list). What are the chances Democrats walk away from his money and influence? Not great. There is very likely to be a tea party-esque schism among Democrats very soon now that they will be totally without power come January, just as the GOP was in 2009. Environmental issues could be the fault line along which the party fractures.
In the meantime, Trump and his cabinet will be making it easier for oil and gas firms to tap into those reserves, creating a lot of jobs in the process. As the stats listed by Kraushaar indicate, those moves will be popular beyond the GOP base. They could also have the knock-on effects of 1) making energy cheaper so that U.S. manufacturing becomes more competitive without renegotiating a single trade deal, and 2) fueling higher tax revenues to pay for the infrastructure spending Trump has repeatedly touted.
Combine the latter with corporate tax reform that includes a special rate on repatriated funds — something I expect Trump to try in his first few months, since it’s his best bet for an early, bipartisan policy win — and we could be looking at tens if not hundreds of billions of dollars in fresh revenues. Plopping them all into an infrastructure bonanza wouldn’t be the most economically efficient or useful act, as President Obama learned the hard way (just Google “stimulus shovel ready projects”). But a smart deployment of new revenues to projects with strict, measurable criteria could make sense and put more blue-collar Americans to work. Not to mention the private-sector boom that would come from simply bringing $1 trillion or more off the sidelines and injecting it into the economy.
This isn’t your father’s Republican policy agenda (for that, look to what Congress produces on taxes, entitlements and health care) but it is the kind of program that could give a temporary jolt to the U.S. economy while wrong-footing Democrats. It’s very likely the method behind what liberals will try to brand as madness.