Trump failed to save Big Coal; can Warren succeed?
By Scott Sumner
The Trump administration promised to revive the declining coal industry, but has failed to do so:
Robert E. Murray, the U.S. coal baron who pressed the Trump administration to help save America’s struggling miners, placed his company into bankruptcy as demand for the fossil fuel continues to weaken.
Even a determined administration has difficulty going against powerful market forces. One tactic that Trump did not try would be to help coal by putting its competitors out of business. Perhaps the coal barons should take a look at Elizabeth Warren’s policy proposals:
Ms Warren sees environmental policy as an opportunity to play favourites and to protect American manufacturing. She wants an accelerated phase-out for carbon-free nuclear electricity and a ban on fracking, which has not only made America the world’s top oil producer but also provided it with a lot of cheap natural gas. This appeals to the Democrats’ base; but it would also make America’s transition to cleaner energy more expensive and less effective. Ask someone selling coal-fired electricity what they want for Christmas and an end to nuclear power and cheap gas will come high on the list.
As the Trump administration demands that China abandon its industrial policy, they are going in the opposite direction back at home:
The Trump administration wants to dictate how and where global auto companies make cars and parts to secure duty-free treatment under the new Nafta — in its most direct intervention yet to manage trade and production, according to people familiar with the effort. . . . The push comes amid Trump’s tariff-led assault on supply chains that run through China. It illustrates how much his administration has drifted from Republicans’ free-market ways and is willing to employ the sort of coercive tools used in command economies like China to force domestic production.
Some worry about giving the president so much power:
People familiar with the discussions say the language gives the White House a chance to abuse the transition-plan approval process to pressure companies into making politically expedient investments. To avoid an opaque process ripe for meddling by politicians, auto companies and Congress are asking USTR to commit to uniform rules so they can plan accordingly and don’t have to fear retribution for opening a plant in Mexico, for instance, instead of the U.S.
As long as America voters elect philosopher kings who are not vindictive and are not focused on the next election, then there is no reason to fear that these powers would be abused.