The 2020 Presidential Election and Prospects for Coal
By Dr. Roger Bezdek, Management Information Services, Inc.
The 2020 U.S. elections cycle culminates in November with election of the president, vice president and 470 Congressional seats, including 35 Senate and 435 House seats. This year’s election is being influenced by a unique set of factors and political dynamics. They include the COVID-19 pandemic, the resulting severe recession and spike in unemployment, and recent waves of social protest. There are also uncertainties surrounding absentee and mail-in voting and whether there will be enough elections judges for in-person voting.
In 2016, every Senate contest went in the direction of the presidential vote. This year, each party is defending two states where the opposite party’s presidential candidate won in 2016.
A presidential election year usually works to the Democrats’ advantage, with higher voter turnout and especially among Democratic constituencies.
The House and Senate
Democrats hold a significant majority in the House of Representatives – 232 Democrats to 198 Republicans. There are four vacant seats, three of which were held by Republicans. Further, 27 House Republicans are retiring, compared to nine Democrats.
Given the size of their current majority, Democrats are likely to retain control of the House. Thus, the House will likely continue to be a source of proposed legislation detrimental to the coal industry.
Meanwhile, the Senate is in play. Republicans hold a slim three-seat majority, 53-47, but they are defending 23 seats while Democrats are defending 12. Thus, Republicans are more vulnerable to losing seats. However, 20 of the Republican incumbents are from states Donald Trump carried in 2016. Two Democrat-held seats are considered competitive and five Republican seats are considered competitive. Thus, even though Republicans are defending twice as many seats, the Democrats have a difficult task to regain control of the Senate. Assuming Democrats win all of the 10 seats they are defending that are not considered competitive, they still have to win at least four of the seven competitive seats – three if Democrats win the presidential/vice presidential race, since the vice president breaks ties in the Senate.
The battle for the Senate is vital for the coal industry. Unless Democrats flip the Senate, Joe Biden’s grand plans – discussed below – are moot. Holding the Senate is just as significant if Trump is reelected. If not, and Democrats have control of both Houses of Congress, they would control the legislative agenda, budget and judicial confirmations. There will likely be openings in the Supreme Court within the next few years, and the Senate confirms Court nominations. Beyond that, a unified Democratic Congress would be a major advantage for Biden – or a major hindrance to Trump if he is reelected. Further, if Democrats control both Congress and the White House, it will ensure a plethora of legislation detrimental to the coal industry.
The Presidential Race
President Trump is currently trailing Biden in the polls. Democrats overwhelmingly disapprove of him, Republicans overwhelmingly approve of him, and a majority of independents disapprove. Of more concern to Republicans, this level of disapproval exists both in battleground states and in swing counties. His response to the COVID-19 pandemic and the resulting recession and catastrophic job losses have significantly weakened him, and the polls show him losing to Biden. However, the 2016 polls were notoriously misleading. Further, the election will be decided in the Electoral College, where Trump won in 2016 despite losing the popular vote. Notably, the Democrats’ position on coal may come back to haunt them in electorally critical states, especially Ohio and Pennsylvania.
Trump has repeatedly voiced support for the coal industry and rescinded a number of Obama-era regulations in an effort to assist coal plants. The president of the United Mine Workers of America (UMWA) noted that Trump has helped stop the erosion of the coal industry, with employment holding steady under his administration.
The Trump campaign is not hesitant about publicizing the administration’s energy initiatives, which include:
- Enacting numerous policies that facilitate development of U.S. energy resources.
- Rolling back policies enacted by the previous administration that were hindering energy development.
- Downplaying the extent to which climate change is considered a national security threat.
- Withdrawal from the Paris Agreement on climate change and opposition to international climate negotiations.
- Eliminating many costly Obama-era regulations, such as the Stream Protection Rule.
- Rescinding Obama’s Clean Power Plan and reversing his carbon mandates.
- Approval by the Federal Energy Regulatory Commission (FERC) of the expanded use of the Minimum Offer Price Rule for PJM.
- Facilitating energy infrastructure development to ensure that U.S. energy can be produced.
- Reducing red tape hindering construction of new energy infrastructure through Executive Order.
- Simplifying environmental review processes.
- Reducing business taxes.
Reelection of Trump would mean an aggressive rethinking of environmental policy and additional policies favorable to coal. He would reduce renewable energy standards, increase energy leasing of public lands and initiate further revisions of environmental regulations that would have a lasting effect beyond his presidency. Trump would seek a “Pittsburgh air accord” that would replace the international Paris climate accord, from which Trump will formally withdraw in November. Trump would likely revisit EPA’s endangerment finding – the legal basis for global warming policy, and would initiate debate over whether CO2 should be regulated by Congress.
These initiatives contrast sharply compared to what Biden is proposing.
The nominating process and street protests have pushed Biden to the left and he is campaigning against fossil fuel industries. Biden:
- Proposed a massive clean energy plan designed to eliminate CO2 emissions from the U.S. electricity supply by 2035 – which has serious implications for the coal industry. This plan, drafted with the assistance of congressional Representative Alexandria Ocasio-Cortez and Senator Bernie Sanders, increased from Biden’s earlier proposal of $1.7 trillion over 10 years to $2 trillion over four years.
- Would spend trillions of dollars on energy, environmental and climate mitigation programs that would dramatically reshape the U.S. economy.
- Supports implementation of the Green New Deal.
- Considers the climate crisis (aka global warming, aka climate change) to be a severe national security threat.
- Would make climate change a top priority of U.S. foreign policy and intensify U.S. and international actions to mitigate it.
- Would rejoin the Paris Agreement on climate change.
- Would end “fossil fuel subsidies”.
- Would seek to achieve net zero CO2 emissions by 2045.
- Would institute carbon pricing and regulations.
- Would dramatically increase federal spending on renewable programs and increase tax incentives and mandates for renewable energy.
- Endorses increased EPA regulation of the coal industry.
- Vows to “eliminate fossil fuels”.
However, Biden is relatively “moderate” compared to the other Democrats who sought the nomination in that he is the only one who would not ban fossil fuels exports and supports carbon capture, utilization and sequestration, and CO2 enhanced oil recovery.
The prospects for coal are grim if Biden wins. During a campaign event, he suggested that coal miners could simply learn to code to transition to “jobs of the future”. He stated “anybody who can go down 300 to 3,000 feet in a mine, sure in hell can learn to program as well.” He stated that he will eliminate fossil fuels, including coal, adding that he would hold executives accountable for using fossil fuels and would “put them in jail” if they did not comply. These statements rank with Hillary Clinton’s infamous 2016 statement contending that her policies would put “a lot of coal miners and coal companies out of business”.
Biden has exactly the opposite view on climate change and fossil fuels as Trump. His “Biden Plan for a Clean Energy Revolution and Environmental Justice” consists of five parts. The first ensures that the U.S. will achieve a 100 percent clean energy economy and net zero emissions by 2050. He promises that on his first day in office, he will “use the full authority of the Executive Branch to make progress and significantly reduce emissions”. The second step is to make the U.S. a “stronger, more resilient nation” by creating more ways for local governments and companies to become environmentally friendly. The third step has the U.S. becoming a leader in the fight against climate change, inspiring other nations to follow its example. Biden promises to make treaties and deals with other nations to reduce global emissions. The final two parts outline how he plans to assist working-class low-income communities and communities of color.
Biden promises to protect the benefits of coal miners and power plant workers, and advocates helping miners secure sustainable jobs. His plan includes a “Task Force on Coal and Power Plant Communities” to reinvigorate communities that depend on coal. The plan would invest in assets of mining communities, “like a rich culture, natural beauty, a proven workforce, and entrepreneurial spirit”. However, while some displaced coal workers can transition into other jobs, the work that they usually find pays only $12 to $15/hour, compared to the average of more than $85,000/year salary plus benefits they earn as coal miners.
The bottom line is that if Trump is reelected, the coal industry will continue to face challenges, but will at least have a supportive administration in Washington. If Biden is elected, the coal industry will face an extremely difficult four years.
Dr. Roger Bezdek is president of Management Information Services, Inc. in Washington, D.C. and has over 30 years’ experience in the energy, utility, environmental and regulatory areas in private industry, academia and government.