Posted: 08/22/2008 | Author: H. Sterling Burnett
Greenhouse Gas Bills Just A Bunch Of Hot Air
Greenhouse gas bills just a bunch of hot air
Legislation would hike energy prices, hurt consumers over dubious goal of preventing global warming
Dallas Business Journal - by H. Sterling Burnett Contributing writer
In early summer, the U.S. Senate considered legislation introduced by Sens. Joe Lieberman, I-Conn., and John Warner, R-Va., that would have established a cap-and-trade program to reduce greenhouse gas emissions by 44% in an effort to prevent global warming. Thankfully, the bill was defeated. Because of the media hype generated by former Vice President Al Gore and his successful global warming horror movie, "An Inconvenient Truth," many were surprised by the margin of defeat. The 2008 climate legislation garnered fewer votes than similar legislation had received when considered in 2004 and again in 2006.
What should have been surprising was not the margin of defeat, but rather that it came up for a vote at all. At a time when the public is clamoring for relief from high energy prices, it's amazing that the Senate even considered a bill that every economic analysis has shown would substantially raise energy prices - especially since none of the domestic bills or international treaties considered to date would prevent or even slow global warming.
The Environmental Protection Agency and the Congressional Budget Office analyzed the leading climate change bills. In addition, Science Applications International Corp. analyzed the bills at the behest of the National Association of Manufacturers. They all agree: Global warming laws are all pain, no gain!
For example, SAIC concluded the Lieberman-Warner bill would increase gasoline prices between 60% and 144% by 2030, while raising electricity prices 77% to 129%. The EPA pegged the increase in gasoline prices under the Lieberman-Warner bill at between 53 cents and $1.40 per gallon. Over time, the EPA found that Lieberman-Warner could cost nearly $3 trillion annually.
Texas would suffer But, as the SAIC and the CBO found, these costs are not shared equally. The SAIC study estimated that states such as Texas, Florida and Georgia would suffer disproportionate harm, primarily because of their size, the makeup of their energy sources and their large energy-intensive industries. The Lieberman-Warner bill would mean job losses topping 335,000 in Texas alone.
Even worse, when energy prices are increased, poor Americans are hit hardest, making regulations to restrict greenhouse gases highly regressive. Energy costs already consume 15% of the income for the poorest households compared to only 3% for average households. Furthermore, the CBO estimated that even modest carbon dioxide cuts of 15% would reduce the disposable income of the poor an additional 3.3% compared to a 1.7% drop for the richest Americans.
Yet, for all of these harms, the Lieberman-Warner bill would be ineffective in preventing future warming, in part, because it is unilateral. Developing countries - such as China, India, South Korea, Brazil and Indonesia - are exempt from current international climate change agreements and would not be covered by domestic legislation. Yet, those same, fast-growing developing countries are expected to account for 85% of emissions growth in the next two decades. Indeed, China has already passed the United States as the world's largest CO2 emitter, and its economic growth rate is currently more than three times greater than ours. Thus, there would be little impact on overall greenhouse gas concentrations if all developed countries stopped using energy entirely.
Even if global warming is a threat - and I freely admit I am skeptical of this claim - no benefit would have resulted from the recently failed Lieberman-Warner bill; it would have brought a great deal of misery.
Congress should go back to the drawing board. Lawmakers should not adopt laws that sacrifice the economic well-being of those living in the United States for nonexistent environmental gains.
BURNETT is a senior fellow with the National Center for Policy Analysis, a nonpartisan, nonprofit research institute based in Dallas.