The state of California is ramping up a spit-wad barrage (out of cardboard straws) at President Trump while angering major automobile manufacturers in a puff of putrid breath. In a quixotic quest to lead the world in greening up the environment, Governor Gavin Newsom (D) has placed a “quid pro quo” on car makers. Auto companies that don’t submit to California’s emissions standards – which are tougher than the Trump administration’s – will no longer be considered for the state’s vehicle purchases.
The California Department of General Services recently issued a statement to explain the latest Newsom executive order, which bans state fleet procurements from any auto manufacturers that support the president’s rollback of Obama-era restrictions on exhaust emissions. The real banana in the tailpipe appears to be that California is punishing automakers, including General Motors, Toyota, and Fiat Chrysler, for siding with President Trump on emissions qualifications.
Newsom doubled down, tweeting, “Carmakers that have chosen to be on the wrong side of history will be on the losing end of CA’s buying power.” So far, automakers on board with California’s order are Ford, Honda, Volkswagen, and BMW.
Who Stands to Lose?
The California Air Resources Board (CARB) is the power behind vehicle greenhouse gas and emission standards in the state. Not to be outshone in the one-upmanship category, Trump’s Department of Justice is sniffing out possible anti-trust issues with those automakers that signed on with Newsom’s CARB contract. The department issued subpoenas to each manufacturer in an investigation of whether the agreement is in direct violation of America’s anti-collusion laws. Makan Delrahim, who heads up the DOJ’s Antitrust Division, wrote an op-ed for USA Today about the decision to delve deeper into California’s activities. He wrote:
“No goal, well-intentioned or otherwise, is an excuse for collusion or other anti-competitive behavior that runs afoul of the antitrust laws. Those who criticize even the prospect of an antitrust investigation should know that, when it comes to antitrust, politically popular ends should not justify turning a blind eye to the competition laws.”
You can bet that attorneys for Ford, Volkswagen, BMW, and Honda are now laboring overtime. Who isn’t going to be working those extra hours? Americans on the assembly line for General Motors, Toyota, and Fiat Chrysler. From 2016 to 2018, California bought fleet vehicles from General Motors to the tune of $58.6 million, spent another $55.8 million on Fiat Chrysler cars, and another $10.6 million with Toyota. Throughout any given fiscal year, the state purchases between 2,000 and 3,000 fleet cars. Spokeswoman for General Motors, Jeannine Ginivan, expressed her company’s exasperation with being on the CARB hit list and warned:
“Removing vehicles like the Chevy Bolt and prohibiting GM and other manufacturers from consideration will reduce California’s choices for affordable, American-made electric vehicles and limit its ability to reach its goal of minimizing the state government’s carbon footprint, a goal that GM shares.”
Governor Newsom’s efforts to stop harmful vehicle emissions are at once noble and a pipe dream. Kudos can be given for the state’s attempt to lead by example: Without putting the burden strictly on the general public – forcing a mandate that would exclude many folks from owning a vehicle – the state itself attempted to take the risk. However, government decisions always end up affecting the people, and this gambit has now brought automobile manufacturers into a high-stakes game that could potentially alter the lives – and income – of employees who toil across the nation in factories for maximum hours and minimum wages. Perhaps California could enact policies and plans that don’t negatively impact middle-to-low-income Americans.
Read more from Sarah Cowgill.