In the News

Or the EPA could provide those market-based approaches itself. Michael Livermore at the NYU Law School notes over at TNR’s The Vine that the EPA has the authority to create its own cap-and-trade plan under the Clean Air Act. (Even under legislation, the EPA would have to run the thing anyway.)

International negotiators and pundits had been pinning their hopes for success in Copenhagen on the U.S. Congress—when it became clear that there’d be no bill this year, excitement flagged and the claws came out. But EPA’s greenhouse gas finding will most certainly help President Obama in his negotiations at the climate talks. The envoys from other nations should read the full meaning of this action: it is now officially the law of the land in America that greenhouse gases are a danger to public health.

Many U.S. businesses will likely see yesterday’s endangerment finding from the EPA as a call to the congressional negotiating table on a climate bill. That’s because the option for business-as-usual is now dead—given that greenhouse gases are now subject to the Clean Air Act, companies will have to reduce emissions one way or another.

Recently, however, New York University’s Institute for Policy Integrity released a groundbreaking survey of top US economists revealing that there is a surprisingly high level of agreement among economists on the dangers of climate change as well as an overwhelming consensus that curbing emissions will help, not hurt, the economy.

The Kyoto Protocol has taken criticism from all sides over the years. But in fairness, it is important to recognize that, according to almost any estimate, the treaty has resulted in surpassed targets in some nations, significant emissions reductions even in nations that may miss their targets, and a marked improvement over business-as-usual had there been no treaty. Whether nations ratified the treaty or abstained, all have been the beneficiaries of global benefits these reductions have generated.

International climate change negotiations have centered on which countries are willing to pay, how much, and when. Putting aside bickering over who will pick up the tab, the most central question that we need to ask is: What are we willing to pay to avoid serious harm to our children and grandchildren?

Some economists believe the answer is to “discount” the effects of climate change depending on how far in the future they fall. In effect, the further out in time something happens, the less important it is.

Postponing the vote on climate change legislation carries both political risks and possible rewards. But decision-makers shouldn’t abandon the most pivotal element of the bill: a price on greenhouse gas emissions. Breaking down the legislation into smaller pieces to avoid confrontation about carbon pricing is a bad idea.

This Friday is the deadline for public comments on the stricter vehicle efficiency standards from EPA and the Department of Transportation. The docket is likely to be overrun with statements for and against the regulation that would make cars and light trucks 30 percent more efficient in 5 years.

From an economic perspective, the social benefits of the rule outweigh the costs. The environmental, health, and energy security benefits—most especially from reducing the tailpipe emission of greenhouse gases—could more than double the estimated costs to manufacturers of installing more fuel efficiency technologies: social benefits could total over $800 billion, compared to around $400 billion in compliance costs.

Obama Administration regulators have moved forward with a climate agenda at a good clip—taking the issue from zero to sixty to make up for the lost time of the past eight years of stalling. So while the cap-and-trade bill that passed in the House of Representatives is currently stalled in the Senate, it is not true that American negotiators are going to Copenhagen empty handed.

The debate over the economics of climate change boils down to that very calculation: how much are we willing to pay today to avoid climate risks in the future? The simple fact is that as we continue to use fuels that contribute to global warming today, we place major economic burdens on our kids and grandkids tomorrow.