By Luke Tonachel, Natural Resources Defense Council
In the Trump administration’s latest effort to roll back public safeguards and reward its polluting pals, the Department of Transportation snuck out a gift to automakers late on Friday. The department announced it would slash the penalties automakers must pay for not meeting federal fuel economy standards to a level that was established in 1997.
The administration is flouting Congress’ 2015 directive that federal agencies raise fines with inflation to enforce commonsense vehicle efficiency standards that cut carbon pollution and the costs drivers pay. Given inflation, today’s fine level is effectively only 64% of the 1997 level in real dollars.
But the Trump administration argues that’s OK because automakers will save $1 billion. In fact, the changes encourage automakers to pay a modest fee instead of making needed investments in cleaner, more efficient vehicles. The result could be that automakers lose money because they offer fewer fuel-efficient options for consumers and therefore suffer reduced sales. Our nation’s pollution and oil consumption will go up.
The fee rollback is yet another of many examples of the Trump administration siding with polluters over the needs of our children, our health and our economic security.
So, what’s going on here?
The National Highway Traffic Safety Administration sets fuel economy standards for passenger vehicles and enforces the standards by fining auto companies that violate the rules. Those fines have not increased with inflation in 20 years, however. It was first set in 1975 at $5 for each tenth of a mile per gallon a manufacturer falls short of its compliance obligation, and then bumped up to $5.50 per tenth of an mpg in 1997.
In 1997, the cost of a gallon of gas was $1.23 a gallon, a first-class stamp 32 cents and an average new home $141,000. Prices have risen since then, as Congress recognized in 2015 when it passed a measure mandating that fines increase with inflation.
And so, in 2016 NHTSA finally updated the fine level to $14 per tenth of an mpg, using the legally-required formula for inflation adjustment. It makes sense, right? After all, you are paying about double the cost of a gallon of gasoline why should polluters get a bargain for delivering inefficient vehicles?
Well, good sense and the Trump administration don’t always go hand-in-hand when it comes to pollution. NHTSA, after trying and failing to just ignore the new fine level, announced Friday it was scrapping any adjustment. This would move us back to the $5.50 put in place more than two decades ago.
And this is all part of a broader assault on clean air and climate action. Even while it’s cutting the penalties, the Trump administration is moving to roll back the standards themselves. So, if it got its way, automakers would be free to make no improvements in their fleet efficiency—and get minimal fines if they even backtrack.
This is such an absurd result, it’s hard to know whether to laugh or cry. Right at the moment when we are learning just how quickly we need to ramp up our efforts to cut carbon pollution from our cars and trucks, the administration is jamming the transmission into reverse. We need to make sure that doesn’t happen.