Kiss Biden’s ridiculous energy policies goodbye. We won’t miss them.
Trump to Roll Back Biden’s EV and Emissions Policies
Reuters reports Trump Transition Team to Roll Back Biden EV, Emissions Policies
Incoming U.S. President Donald Trump’s transition team is recommending sweeping changes to cut off support for electric vehicles and charging stations and to strengthen measures blocking cars, components and battery materials from China, according to a document seen by Reuters.
The recommendations, which have not been previously reported, come as the U.S. electric-vehicle transition stalls and China’s heavily subsidized EV industry continues to surge, in part because of its superior battery supply chain.
The transition team also recommends imposing tariffs on all battery materials globally, a bid to boost U.S. production, and then negotiating individual exemptions with allies, the document shows.
Taken together, the recommendations are a stark departure from Biden administration policy, which sought to balance encouraging a domestic battery supply chain, separate from China, with a rapid EV transition. The transition-team plan would redirect money now flowing to building charging stations and making EVs affordable into national-defense priorities, including securing China-free supplies of batteries and the critical minerals to build them.
The proposals came from a Trump transition team charged with crafting a strategy for swift implementation of new automotive policies. The team also calls for eliminating the Biden administration’s $7,500 tax credit for consumer EV purchases, a plan that Reuters first reported last month. The policies could strike a blow to U.S. EV sales and production at a time when many legacy automakers, including General Motors (GM), opens new tab and Hyundai have recently introduced a wider array of electric offerings to the U.S. market.
The transition team calls for clawing back whatever funds remain from Biden’s $7.5 billion plan to build charging stations and shifting the money to battery-minerals processing and the “national defense supply chain and critical infrastructure.”
While batteries, minerals and other EV components are “critical to defense production,” electric vehicles “and charging stations are not,” the document says.
The transition team recommendations would allow automakers to produce more gas-powered vehicles by rolling back emissions and fuel-economy standards championed by the Biden administration. The transition team proposes shifting those regulations back to 2019 levels, which would allow an average of about 25% more emissions per vehicle mile than the current 2025 limits and average fuel economy to be about 15% lower.
The proposal also recommends blocking California from setting its own, stricter vehicle-emissions standards, which more than a dozen other states have adopted. Trump barred California from setting tougher requirements during his first term, a policy that Biden reversed.
Hello California
Letting California dictate policy for the nation is crazy. Expect a battle over this one and expect Trump to win.
California Governor Gavin Newsom said that if Trump cut the EV subsidy he would replace it.
OK go ahead. But it will be on the backs of California’s taxpayers already saddled with mountains of Newsom’s nonsense.
Rollback Standards to When
I don’t understand the case for rolling back goals we have already achieved, but perhaps I am missing something. Is 2019 a policy trial balloon?
Freezing the 2023 standards is another possibility.
Mileage will improve automatically if and when EVs gain enough market share. I suspect they will be when battery technology improves, and some improvements are in the works.
What I certainly want to kill are Biden’s EPA’s goals from 2026 on. Those pending rules would force people into EVs before the infrastructure is ready.
National Defense Supply Chain
Channeling money to critical materials development makes sense.
However, “whatever funds remain from Biden’s $7.5 billion plan to build charging stations” sounds almost useless vs the task at hand.
But at least we are discussing the right things.
Killing the $7,500 EV Subsidy
Most of the above except the EV subsidy can be done by executive order.
Killing the EV subsidy, however, is part of the ridiculously named Inflation Reeducation Act.
And the auto industry will fight to keep those subsidies.
Hopeful But Skeptical of DOGE
Compare the Reuters headline to mine. Reuters made it seem like a done deal. My headline says “proposes”.
Team DOGE has no authority to do anything but make recommendations.
For all the hype, DOGE has not come up with anything that I would not have proposed.
For example, DOGE wants to eliminate the Department of Education. Great, but this is an idea that been circulation for at least a decade by Ron Paul and others.
The idea will die if four Republican Senators disagree or perhaps if as few as a couple of House members disagree.
To Do and Undo
It’s much easier passing something than undoing it. Let’s see if we can even do something seemingly simple like killing EV subsidies.
So, color me skeptical until DOGE comes up with ideas we have not already heard about for the last 10 years, and then Congress actually votes on them, and Trump signs them into law.
Otherwise, it’s all hype.
A Tiny Republican Majority in the House Will Make Legislation Difficult
On November 30, I noted A Tiny Republican Majority in the House Will Make Legislation Difficult
Here’s the deal. If there are many as two defections, Republicans will not be able to pass much of anything if Trump tries to deliver his campaign promises like no tax on tips, no tax on Social Security, and no tax on overtime.
How many balanced budget hypocrites do you expect to see when Trump proposes big budget deficit increases?
An Interactive Exercise: What Would You Do to Balance the Budget?
On December 4, I offered An Interactive Exercise: What Would You Do to Balance the Budget?
I balanced the budget. Team DOGE hasn’t. But my proposals have the same philosophical issue.
It’s easier to do something than undoing it. Cutting the budget is mostly a case of raising revenues or undoing something that’s already done.
Good luck with that.
I’m sure it all good well. Good luck with your layoffs
Color me skeptical on this one (axing of $7,500 credit). Elon threw a fit and resigned from Trump’s advisory council back in 2017 when Trump left the Paris climate accords. Most have forgotten that.
Elon jumped on board this time around because he saw and opportunity to heavily influence policy to his benefit. This is what rich and powerful people do. Who can blame them? I would probably do the same thing.
DOGE will most likely recommend cuts, but rest assured those cuts will be pissed away elsewhere. Most likely in places that benefit Trump, Musk, et al.
“Hello California”
Hello from California, where in L.A. County, new D.A. Hochman is a breath of fresh air. We are also probably the Tesla capital of the country. Recently saw 3 Cybertrucks in 5 minutes, driving in Glendale. Tesla is even constructing a new restaurant in Hollywood. Will even have giant LED movie screens outside, as part of its theme.
Ending the trucks exemption from CAFE standards would be sensible..
Exposing government waste and the representatives responsible for it is a great first step. I can envision, for example, a running score card on X for each elected representative, maintained by DODE.
They do not have any authority over policy, but they will have the public stage and access to information for which they will offer their interpretation. Anyone familiar with media, will tell you that’s powerful. In many situations, it is more powerful than departments with authority.
nobody who cant charge at home on the cheap buys a Golf cart
the end
so the very place they are good for in the cities
is the one place that has the least ability to charge them up
you bought a Betamax
Another day, another post full of hubris
If you don’t like EVs, don’t buy one (that’s why it’s called a market). If you don’t want EV tax credits, threaten to primary the Republican Congress (and convince them to remove everyone else’s subsidies, too).
But why spread falsehoods with such confidence? Data is out there that easily disproves your ‘argument’. The vast, vast, VAST majority of housing within the US is in the form of single-family, detached housing: https://www.statista.com/statistics/1042111/single-family-vs-multifamily-homes-usa/. Perfect for charging your own EV (if you so choose).
And that housing is spread throughout “cities” across all of America. And the majority of those are not so far ‘out in the country’ that their owners can’t get around on a 300-mile single charge (if they so choose). And there are plenty of ADDITIONAL multi-family housing units that also have access to joint chargers at home or within the city they can easily utilize (if they so choose). Very few people live in skyscrapers in Manhattan and also have a car they would want to transform into an EV, but for a personal charger.
“If You Don’t Like EV’s Don’t Buy Them”, okay, fine…it’s the grift SUPPORTING them which most oppose. Elon Musk would be a small fraction of the business guy he is today if he had NOT enjoyed the government privilege of forcing other car companies to pay Elon for the privilege of them building cars and trucks that their customers actually WANTED and could AFFORD.
“Grift”? Yeah, right, like Elon and the Democrats have been in cahoots all along LOL
CAFE standards have been in existence for 50 years now to improve fuel economy and to make pollution less. Congress had 50 years to get rid of that and other incentives and they did not – because a lot of people wanted those standards.
Don’t like it? Fine by me. You should be calling your majority Republican Congress member right now – to make sure they are on this new mandate
Everything about the Tesla business model was other manufacturers paying Musk for carbon credits. A non-market fake job if there ever was. Only government force would create such nonsense. CAFE standards are NONE OF THE GOVERNMENT’S BUSINESS, but that probably means little to you. That a tyranny has existed for 50 years doesn’t make it right or good.
Since Trump is not in office yet we don’t know if DOGE will work or not so everyone is in anticipation. I do believe that DOGE will focus on widespread cuts that can be made by Presidential degree and that could itself be a big chunk. It has never been done before but we never before had a President who took cuts seriously. Trump seems to be different in that and we can tell by his putting Elon Musk and Vivek Ramaswamy in charge of it. For the first time I remember there is a broad consensus not only in the electorate but also in industry and finance that it has to be done. Perhaps it will.
For a long time the smartest people did no go into politics which explains why we had a string of rather stupid politicians running things. I think that the smart people have woken up to the fact that if they don’t do something then the party is going to over for everybody so they decided to intervene in a big way to get the country back on track.
Excellent Synopsis Doug!
I would cut half a trillion off the DOD budget. It is disgusting we spend so much on defense. It’s more than many countries combined! Insane. The Founders of our country never intended for us to be an Empire. I trust them more than Mish, Trump, and other “wise men.”
If you read what they wrote you would see that they wanted to kick out the British in order to establish an American empire from the Atlantic to the Pacific. Every President worked diligently to that goal till it was achieved.
Defense spending has become a boondoggle, like EVs. Littoral Combat ships? Billions upon billions wasted, they don’t work. F-35, problem after problem, cost over run after over run. Osprey aircraft, oh look another one crashed! Bureaucratic procurement process, corruption with rotating seats from Pentagon to defense board seats, ad nauseum. You could spend half and get twice as much.
When was the last time the continental US has been attacked by outside forces and what happened to them? That didn’t come about by wishful thinking. As for the F-35 for a plane the “doesn’t work” there is a long line of countries waiting to buy them. The Israelis showed what they can do. Ospreys crash occasionally like any other military aircraft and the LCS had two versions one of which has been retired but the other one kept because kit is useful. Obviously much waste can be eliminated but if you think you can get defense on the cheap then go ask the Europeans if that was a wise policy.
Chevron Deference case and 10th Amendment to the U.S. Constitution . Federal government out of all of this crony graft nonsense.
Now that Chevron is overturned … next step to properly guardrail the “general welfare” clause of Article I, Section 8, Clause 1.
General welfare is not taking from one person to give to another … that’s specific welfare to me.
I enjoy watching these policy initiatives. New Tariffs on ALL battery materials. End subsidies for EVs, charging stations, etc.
This will slow the growth of EVs and PHEVs in the US. Fortunately, that does not hurt us much as we have easy access to 8 million barrels per day of heavy oil from Canada, Mexico, and Venezuela, to help us produce the gas and diesel we burn.
Meanwhile, China continues to electrify everything; EVs, PHEVs, rail, etc, because they want to be less dependent on foreign oil. Which will help keep oil prices lower than they would otherwise be, as their growing demand for oil slows. Which is a plus for us.
I wonder which strategy will end up the winner in 5-10 years time?
Yep, China has huge supply of coal for thermally generated electricity with 149,818 million tons of proven coal reserves as of 2016, ranking 4th in the world.
I’m sure they use only the greenest of methods to mine/burn their coal (yes, /s).
https://www.worldometers.info/coal/china-coal/
Plenty of energy needs for both ICE- and Battery-cars.
Hmmm. Who has the largest coal reserves?
Are you saying China will be the winner?
Trump wants the supply chain to be in the US the same that China’s supply chains for their EVs are withing China’s borders. Ultimately it will generate cost savings.
Who will be the net winner; US or China?
Bit early to say but doing nothing, the Libertarian view, is a recipe for disaster.
Too hard to call with any surety.
Many will tell you it will be China because they are moving away from fossil fuels. But as you say, that keeps oil costs down for the US because they will be using less.
Also all of this new EV stuff may not last as long as ICE. Party because Chinese stuff doesn’t have the greatest reputation at the moment (could change in 10 years time obviously).
What does last may have to be replaced entirely if a breakthrough happens in the next 10 years in battery/charging tech. If a true breakthrough happens the US will be in a much better spot because they will have no legacy costs (older stuff to replace) and can go directly to the winning technology in the same way China caught up in 20 years with the West by going directly to the winning technology.
Yes. The future is difficult to predict.
New battery/charging technology can have an impact, but only over a long period of time. There were 94 million vehicles produced last year and there are 1.5 billion vehicles in use worldwide. That’s a 15+ year turnover period.
Of the 94 million produced, 14 million were EVs, which is where any new battery technology will occur. That’s a 100 year turnover period.
Historically, the advantage will go to the countries that embrace change and new technology, rather than rejecting it. Perhaps it will be different this time.
The winner in new battery technology is going to be solid state storage. Huge research into this has been ongoing for years.
I think that Toyota will be the first car company to use it in its cars and will prove that their hybrid strategy has been 100% correct.
Maybe we’ll see something in about 3 years or so.
People may not know it, but Nippon Denso was looking at brake regenerative systems for trucks and buses over 35 years ago and I worked on aspects of that project at the time.
The additional costs of the systems were not economical at that time.
Wasting billions and billions.
Democracy’s future vision is 4 or at most 8 years when to win the voters.
If opposition party doesn’t oppose the government they are not opposition.
If policy change every 4 years or so you’re definitely loser.
Now it seems global EV market is controlled by China and
global ICE market is controlled by US, Europe, Japan and S Korea.
Guess – who will be the winner?
An awful lot of the IRA money (from what I understand, a majority of it) went to red states/districts where the reps involved are going to fight tooth and nail to keep their new battery factory or what have you.
So yeah, I’m with Mish on this one. It’s unlikely we’ll see any big cuts to anything, though I’m sure there will be some symbolic defunding of someone’s $5000 grant to make controversial artwork or study invasive animals or something.
North of $3 trillion in deficit spending for 2025. $50 trillion federal deficit by the time Trump leaves office.
No way out.
What’s a DOGE?
In case you are serious
DOGE
https://mishtalk.com/economics/doge-caucus-is-now-officially-bipartisan-applications-accepted/
Does your Doge bight? — Inspector Clouseau
Damn right it bights.
In case, you’re not serious.
https://x.com/i/status/1861589664617918616
I always wandered why Tesla being the only profitable EV manufacturer won’t challenge the tax credit. Now, being in the driving seat, that was a low hanging fruit.
However, brace yourself for higher prices. Elon’s cheap electric car hasn’t seen the light of day.
Without the tax credit he’ll have to lower the price of every Tesla by $7500 at least I think so.
Do ors Tesla still get the tax credit for its EV’s?
I thought those ended a long time ago.
If so by stopping that credit for other makers of EV’s, Tesla would be at an advantage in the market.