by Raymond J. Keating –

The law matters for our economy and society in general, and of course, it must apply equally to all. If not, when the rule of law crumbles, we’re all placed at risk of being steamrolled by government. Unfortunately, the sanctity of the law has suffered at times of late, even getting ignored, in the name of political expediency.

One example has been the Biden administration’s willingness to undermine the law in the name of its political fight against climate change. But at least one judge stepped in on August 18 to stand up for the law, even as the issue has ping-ponged throughout the courts.

During his first days in office, President Biden signed an order that placed a “pause” on new oil and gas leasing on federal lands and offshore waters. By in effect halting onshore and offshore federal oil and gas lease sales, however, the president ignored the law.

In January 2021, a federal district judge, Terry A. Doughty in Louisiana, struck down the executive order (as it applied in the 13 states bringing a lawsuit – Alabama, Alaska, Arkansas, Georgia, Louisiana, Mississippi, Missouri, Montana, Nebraska, Oklahoma, Texas, Utah and West Virginia). However, the U.S. Court of Appeals for the 5th Circuit vacated that decision on August 17, 2022, on narrow grounds, saying that the lower court’s order was too vague. Well, Judge Doughty issued a permanent injunction against the president’s executive order on August 18. As reported:

Doughty ruled the order was in violation of the Mineral Leasing Act (MLA) and Outer Continental Shelf Lands Act (OCSLA), saying it took steps reserved for Congress. 

“Both statutes require Government Defendants’ agencies to sell oil and gas leases. The OCSLA has a Five-Year Plan in effect that requires eligible leases to be sold. Government Defendants’ agencies have no authority to make significant revisions in the OCSLA Five-Year Plan without going through the procedure mandated by Congress,” Doughty, a Trump appointee, wrote.  

“The MLA requires the DOI [Interior Department] to hold lease sales, where eligible lands are available at lease quarterly. By stopping the process, the agencies are in effect amending two Congressional statutes. Neither the OCSLA nor the MLA gives the Government Defendants’ agencies the authority to implement a Stop of lease sales,” he added.

Especially today, when separation of powers, and checks and balances, hallmark protections of the U.S. constitutional system, increasingly are being challenged or undermined, everyone should applaud, no matter what side of the issue they happen to favor, when a judge (or a politician, for that matter) stands strong for the Constitution.

Laws can be created, altered, and even tossed out with proper votes by Congress, subject to the president’s signature and veto powers. The president and the courts do not possess such legislative powers.

As for the policy essentials in the mix here, President Biden’s aggressive actions against fossil fuel industries, including oil and natural gas, mean raising costs for consumers, businesses and their employees; inflicting harm on U.S. competitiveness; reducing investment and innovation; and doing additional economic harm by having politicians and government planners allocate resources, rather than via decisions made by entrepreneurs, businesses and investors subject to competition, price signals, profits and losses, and ultimately, consumer sovereignty.

For good measure, while the president and his allies in their crusade against fossil fuel like to talk about so-called “Big Oil,” the biggest group in oil and natural gas industries happens to be small business. For example, 95.6 percent of employer firms in the oil and gas extraction sector have fewer than 100 employees, as do 94.4 percent in the support activities for oil and gas operations and 80.2 percent of employer firms in the oil and gas field machinery and equipment manufacturing sector.

Let’s be clear, when politicians move against fossil fuels, they are moving against small businesses and their employees.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His latest book is The Weekly Economist: 52 Quick Reads to Help You Think Like an Economist.