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Early in his term, the President has aggressively sought to dismantle environmental regulations. His administration is rolling back numerous regulations and undermining enforcement agencies by targeting their personnel.
These actions, he claims, will alleviate burdensome compliance costs for businesses, fostering growth. A White House fact sheet describes the deregulatory agenda as a way to counter “overregulation” that stifles “American entrepreneurship,” harms “small business,” limits “consumer choice,” discourages “innovation,” and infringes on “the liberties of American citizens.”
While some businesses, particularly smaller ones significantly impacted by compliance costs, may welcome this, the rapid dismantling of climate regulations carries a significant price – beyond just emissions reduction efforts. Businesses require policy stability for investment and growth. Currently, any company even remotely involved in climate and energy faces considerable uncertainty.
Despite the substantial financial uncertainty, most corporations remain publicly silent, voicing concerns only privately. The President’s potential for retaliation against dissenting companies encourages executive silence.
However, mandatory regulatory filings reveal companies acknowledging the financial repercussions of abrupt climate policy shifts. Ford Motor Company cites the fluctuating climate policies between administrations as a “legal and regulatory risk” potentially affecting its business. Bank of America points to “divergent views of stakeholders” on climate change and warns of increased “legal and compliance risk” from all sides. Dow, a chemical company, lists climate change among its business risks, noting “changes in public sentiment and political leadership, including government incentives and tax credits to promote emission reductions.”
Following the election, ExxonMobil CEO Darren Woods told Semafor that the U.S. needs more consistent policies. He stated that the “polarization and political back-and-forth…is not good for the country, not good for society. It’s frankly not good for business,” advocating for “more thoughtful, consistent regulation.”
Even seemingly beneficial changes, such as expedited permitting for energy infrastructure, present considerable risks. Rapid project permitting may be difficult with staff reductions. More importantly, the long-term legal challenges to the Trump Administration’s executive actions create uncertainty and delay, hindering effective investment deployment.
Early in the Trump presidency, the complexities of his anti-climate actions became clear – his moves clash with market realities. The disruption itself, given the urgency of climate change, significantly slows the green transition.
