In the News

“It’s as though the nation is walking into a casino and spinning the roulette wheel every day,” says Michael Liver­more, a government regulation specialist and executive director of the Institute for Policy Integrity at New York University law school. “It’s only a matter of time before we’re going to come up with snake eyes and have another disaster.”

On today’s podcast, we talk to two economists, both named Scott. Scott Holladay argues this is one market, where maybe the government should get involved, and protect “net neutrality.”

Net neutrality is one of those issues that a small number of people care passionately about. For everyone else, it’s either a big mystery or a big bore. Net neutrality is about using regulation to require open and equal access to the Internet. Huge sums of money could be at stake in the outcome.

Scott Holladay, an economics fellow who works on climate issues for the Institute for Policy Integrity, said in the future, that could change. “We expect technology to develop so cellulosic ethanol would become a practical fuel source, and we think that the renewable fuel standards will help that to happen and encourage that type of technology development,” he said.

As campaign season begins to come into full swing, the timeline for passing a climate bill has been constricted to two weeks and the options on the table are far less desirable than the more economically efficient and comprehensive carbon caps originally proposed. In the time that remains, Senators scrambling to piece together a package should keep striving for three things that will improve the effectiveness and economic efficiency of this bill.

Manzi makes several important concessions: he acknowledges that denying climate science is nonsense, that we face a genuine threat, and that we should take some steps to address that threat. But Manzi goes off track with his argument that the economics and science of climate change are insufficient to justify actually trying to control greenhouse gas emissions.

With the announcement earlier this week that President Obama will nominate Jacob Lew to replace Peter Orszag at the Office of Management and Budget (OMB), it is worth taking a fresh look at how decisions are made within that agency. When the Environmental Protection Agendy (EPA), or any other federal agency, promulgate a significant regulation, the decision is pored over and scrutinized by OMB’s Office of Information and Regulatory Affairs (OIRA) to ensure it is a wise course of action. But when the government fails to regulate, little attention is paid, even when the stakes are high. To lessen the imbalance, there should be a formal process that reviews inaction.

Michael Livermore talked about the National Flood Insurance Program, how the program works, and its costs and benefits. Pres. Obama signed an extension to the program, allowing people with properties in flood areas to transact sales on those properties.

If the Obama administration is finding itself able to achieve its goals under the current executive order, it might prefer to avoid issuing a new directive that could prompt a political fight and force the White House to commit scarce resources, said Michael Livermore, executive director of the Institute for Policy Integrity. Livermore, who has argued that cost-benefit analysis can be reconciled with environmental regulation, said he supports a revised executive order that would apply the administration’s transparency initiative to regulatory policy. Though it is hard to “look behind the curtain” of the White House, he said he understands that the administration might want to maintain the balance struck by the Clinton-era policy.

A quartet of economists has written FCC Chairman Julius Genachowski with a shout-out for his “third way” Title II reclassification of broadband, in part because they say it would help preserve what is currently a de facto network neutrality regime in which most service providers “do not currently engage in prioritization or price discrimination tactics that would be restricted under the proposed rules.”