By making it easier for cities and states to sue oil companies, the administration continues to push its radical environmental agenda.
By making it easier for cities and states to sue oil companies, the administration continues to push its radical environmental agenda. The Supreme Court should reject it.
T he Biden administration is gesturing toward the center by choosing oil-drilling over climate-change craziness. Last Monday, President Biden approved the $8 billion Alaska Willow project, which will drill for 600 million barrels of oil from “pristine federal land,” in the words of the New York Times. Environmentalists cried betrayal from a president who campaigned on ending all drilling on federal land, while political pundits praised the move as an example of Biden’s centrist policies.
But when voters peer behind the symbolism, they will see that the White House continues to pursue its radical environmental agenda by the everyday decisions of the administrative state. Just this week, the Biden Justice Department went to the Supreme Court to urge it to allow cities and states to inflict outrageous lawsuits against oil companies for allegedly causing global warming. It is not often that the Supreme Court can do anything about climate change. For the most part, the Constitution limits the courts to deciding cases or controversies that involve federal law or that contain a significant federal interest.
However, in several cases pending review — against most of the major energy companies in the nation — the Supreme Court could short-circuit this local effort to distort out national energy markets and bring these cases to an immediate halt. By ignoring the Biden Justice Department, the justices could move the nation toward a far more sensible and responsible approach to global warming.
Led by New York and San Francisco (of course), progressive cities and counties have invented lawsuits against every energy company imaginable, from oil companies Chevron and Exxon to refiners and gas sellers for their role in causing climate change. Joined by cities such as Boulder, Baltimore, Oakland, San Francisco, San Mateo, Honolulu, and the State of Rhode Island, these leading liberal lights suddenly discovered around 2017 that global warming constitutes a “public nuisance” that harms their residents and justifies financial penalties.
These cities claim that the energy companies have caused broad injury through the “production and promotion of massive quantities of fossil fuels,” thus triggering a “global warming-induced sea level rise” followed by flooding, erosion, and harm to municipal infrastructure and water systems. The cities demand that the energy companies fund a “climate change adaptation program” to build sea walls, raise the elevation of buildings, and construct “such other infrastructure as is necessary.” (Ka-ching!) Never mind immediate disasters such as rising crime, stubborn homelessness, and failing schools; San Francisco, New York, and their sister cities will make sure homes stay high and dry 80 years from now.
Energy companies have lost most of their challenges to these lawsuits in court, where states have successfully claimed that there is no federal law that can stop them. The cities and states argue that they are only bringing lawsuits under state law, and that there is no federal interest at stake. Even if fossil-fuel companies have federal law and interests on their side, cities and states demand that the companies wait until the cases have wended their way through the state courts, likely a trip of five to ten years, before they can get a hearing at the U.S. Supreme Court. By the time a case such as this reaches the Supreme Court justices, elected state judges might have imposed billions in judgments against the companies and raised costs on energy production nationwide. In its filing this week, the Biden Justice Department blessed this climate-activist strategy.
Put aside whether forcing energy companies, which require licenses from the federal government to extract and sell oil and gas, to pay damages could have any real impact on global warming. These lawsuits plainly misuse states’ traditional control over laws governing accidents (known as torts) to control conduct beyond their borders. States have the right to regulate the environment and economic activity within their borders; they can impose liability for pollution and similar harms by factories, for example. But the problem is that global warming does not, for the most part, take effect primarily within any single state.
As even John Kerry, the Biden administration’s climate-change special envoy, has conceded, “almost 90 percent of the planet’s global emissions come from outside of U.S. borders. We could go to zero tomorrow and the problem isn’t solved.” Greenhouse gases, as the Supreme Court itself observed in American Electric Power Co. v. Connecticut, do not remain local but quickly disperse and commingle in the atmosphere. “Emissions in [New York or] New Jersey may contribute no more to flooding in New York than emissions in China,” it said. China alone accounts for about one-third of all emissions.
Blaming fossil fuels for climate change, which might then affect city budgets, amounts to the type of extraterritorial regulation forbidden by the Constitution. Under the “dormant” commerce clause, the Supreme Court has long struck down state laws that advance economic protectionism or environmental goals under the guise of health and safety. States cannot impose regulations on imports that effectively seek to control activity that primarily takes place beyond their borders.
During the Great Depression, for example, the Court struck down New York’s effort to set a minimum price for a commodity, such as milk, because the state was attempting to “project its legislation” into neighboring states and hence defeat their competitive advantages. “The Constitution was framed under the dominion of a political philosophy less parochial in range,” the Court observed in Baldwin v. GAF Seelig. “It was framed upon the theory that the peoples of the several states must sink or swim together, and that in the long run prosperity and salvation are in union and not division.” Otherwise, the Court predicted, states would erect retaliatory barriers against each other’s trade. In response to these climate-change suits, for example, Texas, West Virginia, and other oil-producing states might impose costly regulations on electric cars or internet and financial services that originate in California and New York.
It was to prevent self-defeating retaliation between the states that the Constitution vested Congress with authority over our single national market. States have a legitimate interest in protecting public health and safety from harmful conduct occurring within their borders. The conservative justices of the Rehnquist and Roberts Courts have sparked a mini-revival of federalist principles by limiting direct federal regulation to commercial matters. Judicial conservatives have further emphasized the need to maintain states’ sovereignty over issues such as education or crime and have even placed new limits on federal spending mandates. Americans who do not like California’s environmental policies or who cannot afford the high cost of living brought on by anti-growth regulations can always move to Texas or Florida — as they have recently done in the tens of thousands.
Even with the recent revival of federalist principles, states do not have the right to control conduct beyond their territory. A state cannot seek to impose its own views of economic or environmental policy on the rest of the nation. Limiting energy use or replacing fossil fuels with renewable sources should be up to our elected representatives in the executive and legislative branches. It is to Congress, not California, Texas, or Florida, that the Constitution gives the power “to regulate Commerce with foreign Nations, and among the several States.” Of course, every state policy might affect — to some small degree — the flow of interstate commerce, which is why, for example, the Court allows Congress to prohibit the sale of even the smallest amount of homegrown marijuana, as millions of transactions collectively make up the national market. The modern Supreme Court should strike down state laws if their burden on interstate commerce outweighs their claimed local benefits.
Under this conventional judicial analysis, these local lawsuits should fail. The potential local benefit of these claims against energy companies is difficult to measure. Indeed, as Richard Epstein and others have pointed out, some of these same cities have assured investors buying their municipal bonds that they are “unable to predict” whether “seismic events, fires or other natural events, such as sea rise or other impacts of climate change . . . could occur, when they may occur, and, if any such events occur, whether they will have a material adverse effect.” The lawsuits are based on a faulty theory of public nuisance that holds only about a half-dozen energy companies responsible for the global rise in temperatures over many decades, without assigning them a precise share of the responsibility and comparing that with other, major sources of carbon dioxide, such as China and India, or other forms of activity, such as manufacturing or agriculture. Given the arguably very low contribution of these companies to overall climate change, cities and counties cannot show that any damages imposed on these companies will have any effect on, for example, the rise in sea levels and its consequences.
Against these imaginary local benefits, courts will have to weigh the benefits to the national market of these energy companies’ continued work. Despite the push for renewable sources, fossil fuels still provide about 80 percent of all U.S. energy. Forcing energy companies to pay for global harms would place an exceptionally heavy burden on national markets and on interstate commerce that the federal courts should refuse to permit.
Perhaps Americans believe that the nation should severely reduce its reliance on fossil fuels, even at the cost of price increases and supply insecurity. Perhaps they might even agree that billions of dollars should go to cities and states to mitigate the consequences of a rise in the sea level. But that decision should rest in the hands of our elected representatives in Congress, who journey to Washington, D.C., precisely to solve national problems.
Supreme Court intervention unfortunately has become necessary because of progressives’ misuse of the judiciary to impose policies denied them by the normal electoral process. While conservatives generally favor state and local government, global warming by definition demands a uniform federal standard. If climate change truly is global, then it is Congress, not cities and states, that should solve it. Cities and counties have raised outlandish legal theories that would interfere with the enactment of a national climate-change policy. The Supreme Court should reject the Biden administration’s pleas and preserve the national government’s authority to solve a truly national problem.