Up in the Air

In the very public fight between Texas and the federal government, no organization has been as vilified as the EPA and its “job-killing” regulations. That may be good politics, but is it good policy?
Perry, along with Attorney General Greg Abbott and agriculture commissioner Todd Staples, announces the state’s decision to sue the EPA over the regulation of greenhouse gases in February 2010. 
Photograph by

On September 12, one month after Governor Rick Perry declared his intention to run for president, Luminant, the largest electricity generator in the state, announced that it would partially shut down a huge coal-fired power plant in northeast Texas, close the associated lignite coal mines, and lay off five hundred workers. Not a great headline for the governor to see, since the state’s already overburdened power grid barely kept up with demand during this past summer’s record heat wave. But as an illustration of one of his nascent campaign’s key themes, the news could not have been timelier. Luminant blamed a familiar enemy—the overreaching federal government—for the layoffs. The culprit this time, the company said, was the Environmental Protection Agency and its new Cross-State Air Pollution Rule ( CSAPR), which is aimed mainly at limiting sulfur dioxide emissions from coal plants, which provide 40 percent of the electricity in Texas. “The Obama administration continues to put up roadblocks for our nation’s job creators by imposing burdensome regulations based on assumptions, not facts, that will result in job losses and increased energy costs with no definite environmental benefit,” Perry said that same day. “Yet again, this administration is ignoring Texas’s proven track record of cleaning our air while creating jobs, opting instead for more stifling red tape.”

Almost immediately, state senator Troy Fraser, the chair of the Committee on Natural Resources, convened a hearing at the Capitol to get to the bottom of things. In a packed room, Luminant’s CEO, David Campbell, made his case to the panel. He claimed that his company simply did not have enough time to retrofit the plant, known as Monticello, with expensive pollution controls to meet the EPA’s aggressive deadline of January 2012. Shutting two of the plant’s three boilers—representing 1,200 megawatts of power—and switching to low-sulfur coal from Wyoming and Montana to run the third was his only option.

Since no one from the EPA was present at the hastily called meeting, veteran lobbyist Tom “Smitty” Smith, of Public Citizen, a longtime critic of Luminant’s aging coal plants, defended the rule. Senator Kevin Eltife, a Republican from Tyler, asked Smith why he thought President Obama had just days earlier announced that he was delaying a second set of new rules that would have limited smog-producing ozone, a move widely seen by many of the president’s supporters as caving to pressure from industry. “Craven political cowardice,” Smith replied, without a moment’s hesitation. There was a titter from the crowd, but Eltife, whose district is home to Monticello and the associated strip mines, was not in the mood. “Well, I think it was because of the economy,” he shot back. “We’re going to throw five hundred people out of work, and there are no other jobs out there.”

Ten days later, Luminant received a boost when Attorney General Greg Abbott filed suit to stop the implementation of CSAPR altogether. This was hardly a surprise: Texas already had twelve outstanding suits against the EPA. The landslide of litigation began in earnest shortly after Obama moved into the White House. In 2009, when his newly appointed EPA chief, Lisa Jackson, announced that greenhouse gases would be regulated under the Clean Air Act, every state in the union began crafting rules to comply. Every state, that is, except Texas, which sued the EPA instead. “The EPA’s misguided plan paints a big target on the backs of Texas agriculture and energy producers and the hundreds of thousands of Texans they employ,” Perry told reporters at a press conference announcing the suit in February 2010. “This legal action is being taken to protect the Texas economy and the jobs that go with it, as well as defend Texas’s freedom to continue our successful environmental strategies free from federal overreach.” Four months later, Texas sued the EPA again, this time over Jackson’s finding that a long-standing state program for “streamlining” air pollution permits violated federal law. Next, the EPA took over permitting for most of the state’s big industrial facilities, after ruling that Texas’s so-called flex permit was illegal too. A raft of new regulations from Washington was met by a raft of lawsuits: in the past two years, Abbott has announced more lawsuits against the EPA over the implementation of the Clean Air Act than against polluters who violate the act itself.

Texas, long the nation’s biggest producer of industrial pollution, is now in a shooting war with the EPA, one of the nation’s most feared bureaucracies, and there is no end in sight. It’s not just Perry and Abbott who are up in arms. A host of officials have piled on with public attacks on the EPA, including railroad commissioner Barry Smitherman, agriculture commissioner Todd Staples, and even Comptroller Susan Combs, whose official duties have very little to do with regulated industries. Even the state’s top environmental regulator, Bryan Shaw, the Texas A&M professor Perry appointed to head the Texas Commission on Environmental Quality ( TCEQ), enthusiastically joined the fray. None were more vocal than Perry, who devoted four pages of his anti-Washington broadside Fed Up! to the EPA’s purported overreaching. When he announced his candidacy, it was difficult to miss how nicely the state’s coordinated assault on the EPA dovetailed with one of his major themes: overzealous bureaucrats in Washington were stepping on prerogatives that rightfully belonged to the states, and killing jobs in the process. “It’s just a cemetery for jobs at the EPA,” Perry told a group of tea party supporters after his first debate. In mid-October, he revealed his long-awaited jobs plan, which focused on increased energy production, and once again took the opportunity to call out the agency. “America should not be—and when I’m president of the United States, will not be—held hostage by foreign oil and federal bureaucrats,” he told an audience of Pennsylvania steelworkers.

Perry’s message was well received in the coal and steel country of Pennsylvania, a place, like Texas, where prosperity has long been associated with

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