By Douglas L. Faulkner, “The Cleantech Conservative”
The November elections ushered in a different type of divided government than conventional wisdom expected. Yes, the GOP is in control of the White House, the House of Representatives and the Senate. But, who’s in control of the Republicans and will they – – can they – – work with the increasingly fractious Democrats? And, what about the deeper hues of red and blue now painting the states? So, here are some observations on this sudden political transformation – – and, what the biofuels industry needs to do to prosper in the Age of Trump:
Take a chill pill. Yes, the election results were stunning and momentous, but industry leaders should not panic, searching for quick fixes, like securing meetings with the transition teams or the early appointees after the Inauguration. The transition period is short and tumultuous, and many of those involved won’t be around after Trump takes the oath of office. Even after his Administration takes over, the new team will be greatly understaffed for months and almost immediately plunged into the day-to-day minutiae of the vast bureaucracy gearing back up after months of forced slowdown in preparation for electoral change. And, they will face confirmation battles for key appointees as well as the rewriting of Obama’s 2018 budget request in just a few weeks – – and then, its rollout and defense on Capitol Hill. At the same time, the new team will be looking to fix Obamacare, reform taxes and rollback Obama’s regulations. So, maintain contacts with the permanent civil service, study the unfolding appointments and policies, and wait for the right opening.
Take the long view. Industry C-suites need to step back from immediate tactical considerations, take advantage of the time afforded by the chaos of change in Washington, D.C., over the next few months and dig deep into their strategic plans: re-examining the assumptions behind them and the communications to explain them. We may be in early stages of an historic global switch from public-private to private-public partnerships. Federal governments everywhere face enormous budgetary pressures and will be looking for more low-cost but high-impact options to promote renewable energy and energy efficiency with the private sector picking up more of the slack. Business creation will matter much more than the insider, crony connections of the Obama Administration era.
Mr. Obama’s policies unfortunately turned support for renewable energy and energy efficiency into deeply partisan issues: it will be a long time before mandates, subsidies, heavy federal regulations and massive levels of government spending to boost green energy are in vogue again – – and with the political clout to pass national legislation. The U.S. Navy’s Great Green Fleet may be seen by Republicans as the Great White Elephant, at best needing critical reform to survive.
Geography Matters. A broad swath of territory from the Great Lakes south to the Gulf of Mexico and throughout Appalachia is now Republican-controlled. These regions, added to their many states in the Great Plains, opens the door for long-term Republican control of Congress, or at least the House, given population spreads and voting patterns. At the same time, a few key states, like California, are now virtual Democratic monopolies. California looks to remain a bastion of low-carbon fuel incentives but its regulatory instincts now threaten to be in direct conflict with Washington, D.C., reversing the close partnership both enjoyed during the Obama years.
Divided Government, Part 2. The Trump Administration is only just starting to take shape, but there are many internal tensions between competing interests. Meanwhile, the Democrats’ near-parity in the U.S. Senate gives them bargaining leverage in that body, even as their party descends into bitter debate over unexpected losses. One result of these multiple divisions may be to freeze movement on some items, like the Renewable Fuel Standard until new balances in political power can be fully sorted out. But, conversely, Trump’s and the Republicans’ lopsided victories may so clear the field of old orthodoxies that new, creative approaches to thorny problems can now be aired. Be ready with out-of-the-box proposals, like new priorities on research and rural development, when the windows of political opportunity open. The next Farm Bill is one target to consider.
Go “Red”. Site new facilities in the 24 states now fully controlled (legislature and governor’s mansion) by the Republicans. These GOP strongholds are generally more business-friendly and most are also right-to-work states (where workers have the right to decide themselves whether to join or financially support a union.) Focus your supply chain purchases on American farmers, ranchers and small rural communities. Pay particular attention on the new politically ascendant states of Wisconsin, Indiana and Kentucky – – and their interests in economic growth.
Walkin’ the walk. Re-shaping corporate communications is critical. To the newly-resurgent Republicans, cite the benefits of your industry as job creation, rural development, high-tech adoption and consumer choice. Deep-six explicit talk of climate change mitigation: since advanced biofuels may well displace petroleum anyway as the growing fuel of choice for decades for planes, trains, ships and heavy-duty vehicles as well as provide the indispensable bridge fuel to a hydrogen or electric vehicle future. Support the eventual phase-out of the RFS and EPA hand-cuffing. But, with left coasters, especially Californians, New Englanders and big-city Democrats highlight global warming benefits and cleaner air for urban poor. This is creative marketing of the highest levels for a fractured polity.
Category: Thought Leadership