Episode Transcript
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Speaker 1 (00:00):
Welcome to Charge Conversations, where we discuss the latest on
energy and energy related topics that shape our everyday lives.
I'm your host, Brigham McCown. On today's episode, we're going
to talk about power, just not the power we normally
talk about that fuels our lights and laptops, but constitutional power,
(00:24):
the authority to govern, spend, and keep America functioning when
Congress hits gridlock. Because the government shut down is so significant,
we're going to unpack what really happens during a government
shut down, how executive power fills the void, and what
this reoccurring dysfunction says about the future of American governance.
(00:45):
If you've ever wondered why permitting approvals halt, infrastructure dollars freeze,
or why energy projects set and limbo, the answer might
be pretty simple and even more frustrating than you think.
Congress has failed to pass a budget. Well, what is
a government shutdown? All right, let's start with the basics.
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A government shutdown occurs when Congress fails to enact annual
spending legislation by the start of the new fiscal year.
You'd think that would be January first, but that's a
calendar year. Nope. In federal government world, new Year is
October the first. Without that legal authority, the federal government
can't spend money on non essential functions. It's rooted in
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the Anti Deficiency Act, which bars agencies from spending money
not explicitly appropriated by Congress. Now, not everything stops. A
government shutdown is not really a shutdown. Critical functions continue,
air traffic control, military operations, border security, social security checks,
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just to name a few. But what about other things?
New federal permits stopped, environmental reviews paused, infrastructure contracts, aid,
energy project timelines frozen, National parks closed, or you're on
your own federal workers. Non essential government workers are furloughed,
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or essential workers are working without pay. Shutdowns just aren't symbolic.
They're the cause of real world disruption, and they're often
used as political leverage. Shutdowns may play well on the news,
but they're devastating to real people and directly undermine the
institutions that keep our country running. You might think that
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shutdowns are only about politics and payroll, but they have
a profound impact on our energy infrastructure. Agencies like the
Department of Energy the Federal Energy Regulatory Commission are Pipeline
and Hazardous Material Safety Administration, the Environmental Production Agency, and
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even the Interior and Bureau of Land Management. These are
the backbone of federal energy permitting, inspection, enforcement, and oversight.
During shutdowns, no new LNG projects are approved, no NEEP
environmental reviews are completed, Pipeline permits stall refinery upgrade approvals
are delayed. For companies and communities, time is money, and
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government shutdowns create regulatory uncertainty that ripples through investment decisions.
For example, in twenty nineteen of that shutdown, FERK was
unable to issue key energy authorizations. Billion dollar projects were
left waiting despite having spent years in environmental review. Energy
infrastructure isn't just about stealing cement. It's about certainty, and
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whether it's the energy industry or another one, nothing erodes
certainty faster than congressional dysfunction. So who really holds the power? Now,
let's get to the constitutional core of this episode. According
to Article one, Congress control rolls the power of the purse.
No money can be drawn from the US Treasury without
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congressional appropriation. But here's the twist. When Congress doesn't act,
the executive branch steps in through the Office of Management
and Budget known as OMB, an agency specific legal counsel
to decide, Hey, what's essential, what can we fund with
leftover money? What can we legally continue to do under
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existing statutes? In essence, shut down shift operational power from
the legislative branch to the executive branch. That means that
the White House gets to define agency priorities, Cabinet secretary's
exercise enforcement discretion, and agency's issue internal guidance with the
force of temporary policy. In a shutdown, the president doesn't
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lose power, he gains leverage. While Congress fights over line items,
the executive fills the vacuum. This raises a constitutional question.
When the one branch fails to act, does that abdication
of power become a de facto delegation. Let's call this
what it is, it's shutdown theater. Over the last thirty years,
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shutdowns have gone from rare emergencies to political strategy. It
used to be that Congress methodically approved the eleven or
twelve give or take some years appropriations bills. After all,
that's Congress's primary job. Numero uno pass a budget nineteen
ninety five to nineteen ninety six. It was built Clinton
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versus Newt Gingrich, and the Republicans shut it down in
twenty thirteen. Again, Republicans Senates standoff over Obamacare twenty eighteen
to twenty nineteen was the longest shutdown in US history
to date, thirty five days over the border and wall funding.
In twenty twenty three, we narrowly averted a shutdown, but
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only via a continuing resolution. During the last administer more
than a dozen continuing resolutions were passed to keep the
government going. A CR as they're known, keeps the government
funded at the existing level and just kicks the can
down the road. That's not passing a budget. Now in
twenty twenty five, this time over healthcare energy policy writers
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in permitting reform, we may just have a new winner
for the longest shutdown. Shutdowns are increasingly used as negotiating tools,
but as we've said earlier, they damage institutional trust and
deliver few long term policy wins. And guess who pays
the price? Now It's not politicians, it's federal employees, contractors,
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service members, air traffic controllers, and you, the American public.
Because after all, it would be unfair not to pay
federal employees who didn't show up to work when all
this is over, and we can argue that back and forth,
no work, no pay. Maybe those who work without pay
should get an added bonus they stayed on the job.
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But would you work without money? So why does all
this matter? For democracy? At its core? This isn't just
about late budgets. It's about how democratic institutions function or
fail to function in the twenty first century. Here's what
a prolonged shutdown politics do. They undermine confidence and basic governance.
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They delay national priorities, from infrastructured energy to military to
building ships it's not happening. Hollows out federal agencies, leading
to staff shortages and terrible impact on morale. And it
increases resilience on executive orders and guidance instead of laws.
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When Congress fails to act, that vacuum gets filled not
by voters but by bureaucrats and executive memos. In the
long run, this creates a systemic imbalance. The founders intended
for Congress to be equal, if not some argue the
more powerful branch depending on whether you're a Jefferson In
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or Hamiltonian. I'll leave it to you, but today its
inability to accomplish even basic tasks. Seeds authority to the
president and to the courts. So fixing it, what can
we do? We could have automatic continuing resolutions automatic crs
that automatically stop gap funding if no budget passes. It
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avoids the shutdown brinkmanship. Several bipartisan bills already exist, yet
none have made it very far. We could get out
of the insanity of only budgeting the largest economy in
the world on a year by year basis. Multi year
budgeting creates longer planning horizons and reduces burnout among staff
and agencies. Let's do it. We need to decouple political writers.
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Major policy fights. Shouldn't hold the entire government hostage as
is currently being done today. Separate reconciliation processes for contentious items.
We can also enforce member accountability DOC pay, or restrict
congressional travel during shutdowns. Make them all have overnights at
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the Congress. Lock them in there. Have you ever gone
into a meeting where somebody said, we've been fussing about
this for such a long time. Nobody gets to leave
the meeting until we all agree. Maybe it's not just
for children. We can also increase transparency on who blocks
budget progress, and we can make sure that federal civil
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servants aren't politicized or eroded during shutdowns. And finally, the
long term fix isn't even legislative, it's cultural. We need
leaders who will prioritize governance over headlines. If you're in
the energy sector, I've got a special note for you.
And whether you run a refinery, a utility, a pipeline,
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or work on a grid, Understanding shutdown todynamics is an optional.
You need to track congressional calendars, plan for regulatory freezes,
factor in permitting delays into capital schedules, Engage proactively with
your members of Congress, agency staffers, and omb, and communicate
with local partners and stakeholders. Strategic takeaway is the message
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is simple. All of us depend on federal approvals and
your timeline depends on politics, not just engineering. Is next
to impossible to run a country, let alone run a
company when you don't know what the rules are, when
the rules can change and you don't know whether or
not you'll get your return on investment or whether you
should or should not deploy capital. Lowering the temperature in
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DC produces a more stable economic environment. Congress doing what
Congress is supposed to do can go a long way
toward helping America's economy and setting up a more stable future.
What are your thoughts on shutdowns and executive power? Have
you experienced the fallout first from a delay and a
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permit to a stranded plane, to furloughed work or investment disruption?
We want to hear from you. Email us at Charge
Conversations at bamaccown dot com. We read every message and
value your insight. Well, you've been listening to another Charge Conversations,
a Joe Strucker production. If you like what you've been hearing,
please hit that subscribe button and, better yet, forward it
(11:23):
to five friends. I'm your host to Brigham mccount and
I'll see you next time for another episode of Charged
Conversations