Of the many alarming comments Environmental Protection Agency (EPA) administrator Lisa Jackson made to attendees at the United Nations Climate Change Conference in Copenhagen, a select few stood out as particularly daunting. On the anniversary of Pearl Harbor, the EPA dropped its own economic bomb, asserting that carbon dioxide and five other greenhouse gases are dangerous pollutants and a threat to human health and the environment. Consequently, the EPA is preparing to implement costly regulations on the economy to cut carbon dioxide emissions. But Jackson said we can take common sense without sacrificing our economy. Specifically she said,
“It will ensure that we take meaningful, common-sense steps, and allow us to do what our Clean Air Act does best – reduce emissions for better health, drive technology innovation for a better economy, and protect the environment for a better future – all without placing an undue burden on the businesses that make up the better part of our economy.”
A common sense way to regulate carbon dioxide without cost is impossible. The Heritage Foundation’s Center for Data Analysis study of the economic effects of carbon dioxide regulations found cumulative gross domestic product (GDP) losses of $7 trillion by 2029 single-year GDP losses exceeding $600 billion in some years, energy cost increases of 30 percent or more, and annual job losses exceeding 800,000 for several years. But Jackson didn’t stop there. She also asserted that regulations should not replace cap and trade legislation but instead complement it:
“This is not an either/or moment. This is a both/and moment.”
Not only is this redundant but it also gives lawmakers and unelected bureaucrats authority to pile on rules and regulations that would chokehold the economy. The House of Representatives already passed their 1,428 pages of legislation that includes not only a cap and trade scheme but also a host of other burdensome provisions. Meanhile, the EPA drafted 564 pages of regulations in its Advanced Notice of Proposed Rulemaking. Surely some will overlap but you can be sure that where one misses, the other hits the economy, and hits hard. According to FoxNews, one White House official said of the way EPA will regulate: “[I]t is not going to be able to regulate on a market-based way, so it’s going to have to regulate in a command-and-control way, which will probably generate even more uncertainty.”
Whether it’s disguised as clean jobs legislation or pollution reduction regulation, the reality is any cap and carbon dioxide is an energy tax – an attempt to drive energy prices so high that people use less. Because we use a lot of fossil fuel-based energy and there’s no low cost alternative, there’s no way around the economic pain that will ensue.
Jackson then proceeded to talk about the science behind global warming, taking a backdoor shot at Climategate:
“Now, we know that skeptics have and will continue to try and sow doubts about the science of climate change. These are the same tactics that have been used by defenders of the status quo for years. Those tactics only serve to delay and distract from the real work ahead, namely, growing our clean energy economy and finding innovative, cost-effective ways to reduce harmful GHGs. It’s time that we let the science speak for itself. We have relied on decades of sound, peer-reviewed, extensively evaluated scientific data. That data came from around the world and from our own U.S. scientists. What is makes clear beyond doubt is that climate change is real, and that now is the time to act.”
She’s right about two things. We should let the science speak for itself and climate change is real. Climate change has always been real but it shouldn’t be confused with manmade global warming, or even global warming in general, that’s purportedly destroying our planet. With the emergence of Climategate, now more than ever is the time we should allow for transparent science. Now isn’t the time to rush things through for baseless reasons like “We’ve waited long enough.” We should allow the truth of the science to play out. The skeptics who are allegedly employing method of delay and distract are in reality seeking truth and validity. That’s not such a bad thing for legislation and regulation that comes with such a hefty price tag.
Here in Washington, people are discussing two things: Jim Zorn’s job security as the Washington Redskins’ head coach and health care, in that order. But there’s a $3.6 trillion gas tax on the table that already passed the House and is making its way through the Senate, and cap and trade has Americans all over the country concerned. The $3.6 trillion gas tax figure, which includes gasoline and diesel gas, comes from a new report from Senators Kay Bailey Hutchison (R-TX) and Kit Bond (R-MO) on the effects of climate change legislation. And the energy tax has rippling economic effects, as Senators Hutchison and Bond explain in their Washington Times op-ed:
Americans will be double-hit by the gas tax when it raises the costs of goods and services such as groceries and utilities they must continue to purchase. Energy costs are among businesses’ top operational expenses already. While companies face a variety of energy expenses, ranging from heating and cooling their work space to powering equipment and lighting, operating their vehicles is the most costly. Every company, from the small-town local florist to a package delivery service with nationwide operations, will be hard hit. In order for these businesses to withstand the heavier tax burden and to remain profitable, they will be forced to pass these energy cost increases along to consumers through higher prices.”
Some industries are more energy-intensive than others, and farmers and ranchers are hit particularly hard. Heritage Senior Policy Analyst Ben Lieberman writes, “In addition to higher diesel fuel and electricity costs, prices for natural gas-derived fertilizers and other chemicals will also rise. Everything else affecting agriculture, from the cost of constructing farm buildings to the price of tractors and other farm equipment, will also go up.”
According to the Hutchison-Bond report, U.S. farmers and ranchers will incur higher fuel costs of $550 million in 2020. That figure will jump to $1.65 billion by 2050. According to The Heritage Foundation’s cap and trade analysis, farm profits are expected to decline by 28 percent in 2012 and will be an average 57 percent lower from 2012-2035. Congress is attempting to buy the farm vote by touting them as the beneficiaries of a carbon offset program because farmers can use cleaner technology, reduce nitrous oxide emissions, or simply not grow crops. However, the revenue gained from offset revenue will pale in comparison to lost income from cap and trade.
Economic gains and environmental improvements aren’t mutually exclusive goals; in fact, they often go hand-in-hand. Hutchison and Bond say, “We can improve the environment and economy through American ingenuity and technological advancement, not with taxes and mandates that increase costs and burden American families and businesses.”
Instead, cap and trade significantly reduces the amount of resources the private sector can invest in newer, cleaner technology.
The full report is available here.