In the News

Clean energy standards will not go far enough to rein in our carbon emissions and will cost more—pound for pound—than putting a price on carbon. Granted, it is better to take some action than it is to take none, but this is a small, expensive band-aid on a planet-sized problem.

A sleeper bill by Senators Cantwell and Collins that places a cap on carbon, auctions permits, and put a check into every American’s pocket has been picking up steam (see positive editorials in the Economist, Washington Post, and Denver Post). It might just strike the right balance of job creation, simplicity, and populism to take off.

Fogarty pointed to a paper by Michael Livermore, executive director of the Institute for Policy Integrity at the New York University School of Law, which argues for charging companies that emit carbon dioxide. Livermore claims laws making greenhouse emissions more expensive are the best tools for spurring innovation in renewable energy. “When prices of a commodity are low, there is less incentive to invest in innovation to reduce use of that commodity,” Livermore states.

The majority of 144 economists polled by New York University’s Institute for Policy Integrity, or 84 percent, agree that global warming’s effects “create significant risks” to the economy, and 94 percent agree that the United States should join climate agreements to limit global warming. The Securities Exchange Commission said for the first time that companies should disclose to investors the risks that climate change poses to their businesses. The Institute for Policy Integrity at the New York University School of Law found that failing to deal with climate change will cost our economy an average of $27 million to $375 million every day from now until 2050. This does not include environmental costs or costs to public health.

While government subsidies for “green technology” may be a piece of the total picture, the only way to efficiently generate the levels of investment needed to wean the economy from carbon-heavy sources of power is a price signal which could be generated as a tax or, more likely, as a cap-and-trade.

Almost everyone agrees that legislative climate action is preferred over regulation—it is the simpler, more democratic and longer lasting way to bring down our carbon emissions. But the congressional process has stalled out and Senator Murkowski’s attempt to shut down EPA’s ability to regulate is not helping. Procedurally, a disapproval resolution is destined to fail—at best it is a waste of time, but more likely a political move designed to slow down progress on climate legislation.

The question of how seriously we should worry about the most severe effects of global warming depends on what we are willing to pay to avoid serious harm to our children and grandchildren.

Jason Schwartz, a Legal Fellow at the Institute for Policy Integrity at New York University School, said “the EPA doesn’t have a slam-dunk case.”

“Neither the absurd-results canon nor the doctrine of administrative necessity will allow the EPA to create exemptions to those requirements,” Schwartz and his Institute for Policy Integrity colleague, Inimai Chettiar, wrote in an April policy article.

One potentially saving argument, Schwartz says, is the EPA’s plan to phase in different threshold-level emitters, allowing five years to study streamlining the permitting process for facilities under the 25,000 level. The courts may defer to the agency’s action on that account.

While the head of the Environmental Protection Agency Lisa Jackson has said she’s focused on regulating light-duty vehicle emissions and the largest stationary sources, petitions already filed with the EPA may force much more stringent action, experts say.

“The EPA will be locked into a path that ends in the regulation of most mobile sources,” including airplanes, trucks and trains or the fuels that run them, says Jason Schwartz and Inimai Chettiar, Legal Fellows at the Institute for Policy Integrity at New York University School.

Michael [Livermore], the executive director of the Institute for Policy Integrity at New York University School of Law has echoed this view, noting that a section of the Clean Air act authorizes the president “to enter international agreements… and to develop standards and regulations which protect the stratosphere.” He concluded: “This could provide a foundation for an executive agreement—and Obama wouldn’t need to round up 60 votes from the Senate.”