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Economic Protectionism. As Justice Souter stated in Department of Revenue of Kentucky v. Davis, "The modern law of what has come to be called the dormant Commerce Clause is driven by concern about 'economic protectionism - that is, regulatory measures designed to benefit in-state economic interests by burdening out-of-state competitors.' " If a state or local law is designed to achieve some economic benefit for the state or locality in the form of hoarding resources or avoiding economic burdens, the purpose of the law will be viewed as economic protectionism and this purpose is illegitimate under the dormant Commerce Clause. Typically, a law that is aimed at achieving the goal of economic protectionism will discriminate against out-of-state commerce on its face or in its effect.

The transportation sector emits the highest amount of greenhouse gas (GHG) emissions of all the U.S. sectors, with the rail sector contributing 2% of those emissions. Rail plays an important role in reducing the transportation sector's emissions due to the efficiency of passenger and freight rail transportation. FRA is committed to reducing rail’s carbon footprint through supporting the expansion of electrification and other sustainable fuels, expanding the rail network to provide a more efficient choice for passengers and goods shipments, and reducing GHG emissions from the operations, maintenance and construction of the rail system.

The first is the disconnect between its role in our personal and collective carbon emissions. Air travel dominates a frequent traveller’s individual contribution to climate change. Yet aviation overall accounts for only 2.5% of global carbon dioxide (CO2) emissions. This is because there are large inequalities in how much people fly – many do not, or cannot afford to, fly at all.

The second is how aviation emissions are attributed to countries. CO2 emissions from domestic flights are counted in a country’s emission accounts. International flights are not – instead they are counted as their own category: ‘bunker fuels’. The fact that they don’t count towards the emissions of any country means there are few incentives for countries to reduce them.

The threat of losing federal funding can make states reform-shy

Despite the autonomy states enjoy due to decentralized government, they’re not always immune to retaliation if they choose to go against the federal government. States’ refusal to comply with and direct challenges at federal law can have serious and lasting consequences for states. Sanctuary cities, for example, have been threatened with losing crucial federal funding if they don’t comply with immigration guidelines.

All of this is simply to say that the federal government is well-positioned to aggressively challenge police misconduct at the sub-federal level even as local governments refuse to commit the administrative machinery of sub-federal government to controversial forms of federal criminal enforcement. The trouble with much of the current analysis of sub-federal resistance in pursuit of criminal justice reform is that it equates the withdrawal of support for federal criminal initiatives with the suspension of federal oversight of state and local police departments. The Obama administration's successful efforts to crack down on police misconduct in spite of the sub-federal resistance profiled in this Article offer another piece of evidence against this claim.

The U.S. government framework is characterized by separate sovereignty of the federal government and each of the 50 states. Congress has only the authority provided to it in the Constitution, which includes the powers to regulate interstate commerce and tax and spend for the public welfare. States, as the original sovereigns, retained all powers not exclusively delegated to the federal government, including the power to tax and the “police power” to safeguard the health, safety, and welfare of the population. Nonetheless, the Constitution elevates federal law as the “supreme law of the land,” permitting Congress to preempt state law while exercising its other powers. Although states can preempt local law as the sole purpose of the law, Congress cannot treat the Supremacy Clause as an enumerated power, so it can only preempt state law while acting pursuant to another constitutional authority.

Although preemption is a key concern for all public health policies, federal preemption of taxes is a distinct issue because governments need revenue to function. In the 1819 case, McCulloch v. Maryland, the Supreme Court analyzed Maryland’s tax on a federal bank and resolved the question of whether the federal government can preempt state taxes. First, the Court explained that because the power to tax “is essential to the very existence of government,” it is to be “concurrently exercised” by the federal and state governments. Nonetheless, the Court confirmed that the Supremacy Clause of the Constitution means that the federal government can preempt states’ ability to tax.

The most general and holistic proposal was developed by Beeks and Lambert [68] (2018). In this scenario, fiscal instruments influence market forces by inducing broad, crosscutting, socio-environmentally positive changes in production and consumption. Thus, it is not about correcting the most serious single impacts but transforming the entire economic system [11].

Beeks and Lambert [68] argue that negative externalities will be produced as long as they are economically viable. They will inevitably be transmitted to current and future societies in the absence of government actions capable of counteracting them. One way to reduce these externalities involves acting through market mechanisms—prices, in particular—to decrease associated profitability. For the authors, the objective is not only to transfer certain externalities to prices in accordance with a cost–benefit criterion—as mainstream environmental economics does—but also to design a comprehensive pricing system that incorporates sufficient incentives to change the behavior of economic agents towards sustainable patterns. They explicitly agree with Daly [41] that reducing consumption-related impact may be the best way to reorient the current economic system, which is based on hyper-consumption and works by appropriating the natural (free) system, negatively affecting humanity and the economy itself. To do so, Beeks and Lambert [68] (p. 7) proposed estimating a new cost factor for all services and products, which would integrate all externalities generated in production and consumption. The aim is to fully cover all negative and positive externalities by means of an externality factors (EF) system. These would include estimates for not only CO2 and GHG emissions, but also all pollutants affecting water, the atmosphere, soil, biodiversity, the ecological system, and human well-being.

It therefore did not matter that the federal statute did not contain an express preemption provision. nor did it matter that the Massachusetts statute’s general goal of pushing Burma to greater democracy was the same as the federal statute’s goal. The court held that “[t]he fact of a common end hardly neutralizes conflicting means.” Id. at 379. This is a far more stringent test than is applied to non-foreign policy cases.

Second, in American Insurance Association v. Garamendi, 539 U.S. 396 (2003), the court held that a California statute that compelled insurance companies to disclose policies sold in Europe to Holocaust victims interfered with the President’s conduct of foreign affairs, and was therefore preempted. Although the California statute solely mandated disclosure, California had enacted other laws that would have allowed Holocaust victims who had not received the benefits to which they were entitled under their war-era insurance policies to sue their insurers. The court found that California’s approach conflicted with “Presidential foreign policy,” which “has been to encourage European governments and companies to volunteer settlement funds in preference to litigation or coercive sanctions.” Id. at 421; see also id. at 427 (“California seeks to use an iron fist where the President has consistently chosen kid gloves”).

The constitution specifically assigns power over foreign commerce to Congress, while power over foreign relations has long been read to be the province of the federal government in the person of the President. Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 610-11 (1952) (Frankfurter, J., concurring). in two fairly recent cases, the court has held that the importance of the United States “speaking with one voice” in foreign affairs overrides even traditionally strong state interests, and compels preemption where there is a conflict with federal conduct of foreign relations.

in the first of these cases, Crosby v. National Foreign Trade Council, 530 U.S. 363 (2000), the court found preempted a Massachusetts statute that, as a protest of Burma’s human rights record, forbade the commonwealth from buying goods and services from companies doing business with Burma. even though the state statute governed only Massachusetts’ role as a market participant, the court held that a federal statute imposing certain sanctions on Burma and giving the President authority and latitude to change those sanctions preempted the less-flexible state law. The court ruled that the state law sanctions stood as an obstacle to Congress’ intent to give the President discretion; to congress’ intent “to limit economic pressure against the Burmese Government to a specific range”; and with the President’s capacity “to speak for the nation with one voice in dealing with other governments.” Id. at 377, 381

The U.S. tax code levies a higher tax burden on companies headquartered in America than on companies headquartered in other countries. It is relatively easy for a U.S. company to change the location of its headquarters, by having a foreign company purchase its shares or assets. This process is known as an inversion, and more than 20 U.S. companies since 2012 have used this maneuver to move their headquarters abroad and lower their U.S. taxes.

Since inversions became more popular a few years ago, many Democratic lawmakers have decried the trend (Clinton has gone so far as to call the practice a “perversion”) and offered targeted measures to penalize companies that invert. Republicans tend to treat inversions as a symptom of larger problems with the corporate tax system, and argue instead for broader reforms.

The federal tax code contains several provisions that treat oil, gas, and coal companies differently than other businesses. Most of these provisions allow fossil fuel companies to deduct more of their expenses up front, leading to lower taxes. The Congressional Research Service estimates that, in 2013, the federal government lost $4.8 billion due to tax preferences for fossil fuel companies (compared to $13.4 billion in tax preferences for renewable energy).

Both Clinton and Sanders would eliminate all tax preferences for fossil fuel companies. In addition, both candidates would also limit the ability of certain fossil fuel companies to claim foreign tax credits for their business activity overseas. The Democratic platform reflects the consensus of the two candidates on this issue.

The non-pricing of too many negative externalities (airplane kerosene, intercity highways, commuting in cars to big city centers) has prevented precise economic calculation of social costs imposed on society by various actors. There has been no proper internalization of social cost in private cost, as economist Ronald Coase would explain. Non-pricing and weakened property rights protection have thus not fostered innovation to limit the “internalized” cost of pollution or overexploitation.

Green growth, rather than degrowth, could make a difference if it is undergirded with strengthening pricing and property mechanisms. Movements like the Yellow Vests would accept such pricing as long as it is clear and accompanied by a degrowth of obese, unaccountable and costly government bureaucracies and cronyism. This sort of degrowth, materializing in lower taxes and transparency, would be the compensation for pricing externalities. In this scenario, clarifying property rights, prices and political responsibilities would be the key to cleaner growth.

There is a broad consensus regarding the importance of fiscal policy and the tax system as a fundamental tool for promoting transformations aimed at meeting environmental challenges. However, the proliferation of new, specific, and relatively marginal taxes with environmental objectives is proving to be a failure. Their modest results have fallen far short of expectations and fail to mitigate the serious environmental problems affecting the planet and society today. Furthermore, the capacity to even collect these taxes has decreased over the years.

It is increasingly evident that the inherited fiscal architecture of the past reinforces the unsustainability of the linear economic model. The transition towards a circular economy implies systemic changes that affect all aspects of economic life and require implementation of a policy mix that integrates a wide range of policies and instruments. The question is, what kind of changes in the tax system can effectively contribute to this transition? Systemic change towards CE must be accompanied by systemic change in the architecture of the tax system. However, here we suggest the need for a strategic roadmap that sets out a sequence of gradual, step-by-step changes that allow for major but feasible changes in the short term, clearly oriented to the objectives of long-term architectural change.

The largest U.S subsidies to fossil fuels are attributed to tax breaks that aid foreign oil production, according to research to be released on Friday by the Environmental Law Institute in partnership with the Woodrow Wilson International Center for Scholars. The study, which reviewed fossil fuel and energy subsidies for Fiscal Years 2002-2008, reveals that the lion’s share of energy subsidies supported energy sources that emit high levels of greenhouse gases.

The research demonstrates that the federal government provided substantially larger subsidies to fossil fuels than to renewables. Fossil fuels benefited from approximately $72 billion over the seven-year period, while subsidies for renewable fuels totaled only $29 billion. More than half the subsidies for renewables—$16.8 billion—are attributable to corn-based ethanol, the climate effects of which are hotly disputed. Of the fossil fuel subsidies, $70.2 billion went to traditional sources—such as coal and oil—and $2.3 billion went to carbon capture and storage, which is designed to reduce greenhouse gas emissions from coal-fired power plants. Thus, energy subsidies highly favored energy sources that emit high levels of greenhouse gases over sources that would decrease our climate footprint.

Current accounts portray President Obama’s tenure as dominated by executive policymaking and vigorous challenges from the states. We argue that such accounts overlook how federal–state collaboration has been critical to achieving Obama Administration ends. Partisan polarization has gridlocked Congress and made the President dependent on the states to advance his central policy initiatives. As a result, these initiatives are both more responsive to state demands and more bipartisan than they might appear. After exploring tools by which the President works with the states, we discuss implications for federalism, the separation of powers, and partisan polarization. In particular, the state role in shaping federal regulation raises the possibility that states are both aggrandizing and checking presidential power.

If popular reports and political attacks are any guide, President Obama’s second term has been marked by presidential policymaking and sharp state opposition. With Congress incapacitated by polarization, the President has turned to administrative action to achieve his goals, pushing his agenda on the nation under a justificatory “We Can’t Wait” mantra. Meanwhile, states have led the opposition to such executive action. Governors refuse to participate in Administration initiatives, and state attorneys general sue the federal executive branch for overreach in a variety of areas.

B. Standing to Assert Sovereign Interests: Preemption & Cooperative Federalism

Preemption and cooperative federalism cases concern a very different sort of interest: a state’s sovereign interest in enforcing its laws and defending them against federal encroachment. Yet in these cases, too, states have faced relatively few difficulties in establishing standing. The Supreme Court has stated that “a State clearly has a legitimate interest in the continued enforceability of its own statutes.”205 Federal courts regularly entertain state suits challenging federal limits on state sovereignty.206 And as a normative matter, various commentators consider a state’s capacity to litigate state prerogatives under cooperative federalism statutes or in the face of federal preemption as essential to its ability to exercise self-governance within the nation’s federal system.207

1. The Anti-Commandeering Doctrine and the Legal Status of § 1373 Before Murphy.—As expounded by the Supreme Court in Printz and New York, the anti-commandeering rule bars the “compelled enlistment of state executive officers for the administration of federal programs.” 174 Section 1373 attempts to circumvent this prohibition by forbidding higher-level state and local officials from mandating that lower-level ones refuse to help in enforcing federal policy. More specifically, it requires that “a Federal, State, or local government entity or official may not prohibit, or in any way restrict, any government entity or official from sending to, or receiving from, the Immigration and Naturalization Service information regarding the citizenship or immigration status, lawful or unlawful, of any individual.” 175

This convoluted structure potentially avoids constitutional problems. The law does not directly require state and local governments to turn over any information to the federal government. It merely bars them from instructing their subordinates to refuse such assistance. The final decision on whether to help or not, however, is presumably left to lower-level state and local government employees. This consideration is what led the Second Circuit to uphold the constitutionality of § 1373 against a challenge brought by the city government of then-New York City Mayor Rudolph Giuliani.176 Ironically, Giuliani is today serving as President Trump’s personal lawyer in his efforts to deal with legal issues arising from possible collusion with Russia during the 2016 election.177 The Second Circuit concluded that § 1373 does not qualify as commandeering because its requirements “do not directly compel states or localities to require or prohibit anything. Rather, they prohibit state and local governmental entities or officials only from directly restricting the voluntary exchange of immigration information with the INS.” 178

But if progressives can simply look outside the Beltway, they will find that they still have access to one of the most powerful weapons in politics: federalism. Using the power they wield in states and cities across the country, progressives can do a good deal more than mourn and obstruct. They can resist Washington overreach, shape national policies, and force the Republicans to compromise. Cities and states have long been at the center of the fight over national values. And it’s time progressives recognized that federalism isn’t just for conservatives.

Unfortunately, the moment one mentions federalism many progressives stop listening. The language of “states’ rights” has an ugly history, invoked to shield slavery and Jim Crow. Federalism’s checkered past led political scientist William H. Riker to remark in 1964 that “if one disapproves of racism, one should disapprove of federalism.” Even today, many progressives think of federalism as a parochial anachronism, better suited for stymieing change than for effecting it. But they are making a mistake. This is not your father’s federalism. These days, state and local governments are often led by dissenters and racial minorities, the two groups progressives think have the most to fear from federalism. And this has allowed them to not only take advantage of the enormous power that federalism confers within their own cities and states, but to affect national debates, influence national policy, and force national actors to the bargaining table. Their success shows that federalism is a neutral and powerful tool for change, not an intrinsically conservative quirk of U.S. government.

After running and winning on the most ambitious presidential platform on climate change in history, President-elect Joe Biden is now faced with delivering on his commitments.

Speculation has already begun regarding how this can be achieved, particularly if Republicans maintain a majority in the Senate. Yet most analyses to date have overlooked one of the most important tools at their disposal: building on the leadership of U.S. state and local governments in a new unprecedented era of climate federalism.

Subnational governments, working with non-governmental advocates, drove climate action during the Trump administration while rebuffing federal rollbacks. Under the Biden administration, focus may initially shift towards the federal government, but the subnational network is critical to continued progress on climate change. I use the term “networked federalism” to describe how a horizontal, interconnected, and polycentric collection of states, local governments, Tribes, and advocates provides the resilient frame needed to buttress national action. Indeed, this structure mirrors the successful structure of the Paris Agreement[1]—in which international action depends on subsidiary national contributions. A networked, federalist system of subnational climate action will be critical to continuing success, and should be nurtured and expanded. In this article, I discuss barriers to federal climate action under the Biden administration, trace the important role of subnationals in the climate movement, and lay out a policy agenda for strengthening subnational networks over the next four years.

I. Barriers to Federal Action Under the Biden Administration