New EPA Cap and Trade Regulations Announced

Wednesday, March 28th, 2012 and is filed under Blog, Economy, Taxes

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Here is one of my personal favorite dictums: Republicans and conservatives have correctly asserted that the federal government doesn’t have a revenue problem; it has a spending problem.  However, a more trenchant summation of our public policy vices would go something like this: we don’t have a spending problem, per se; we have a big government problem.  Call it the Dan Horowitz Golden Rule.

All too often we focus exclusively on the budgetary cost of a government program or agency.  We must remember that in the case of many of these agencies, even if we had all the money in the world we should never support them.  Not only are they expensive, they kill the private economy.  No organization better exemplifies this distinction than the EPA.  In Washington dollars, the EPA’s annual budget, $8 billion, is not so much.  However, try to quantify the cost that the EPA exacts on the private economy.  Hundreds of billions?  Trillions?  Try to quantify the cost in jobs and the cost to consumers resulting from their onerous regulations.  These costs far outweigh the budgetary problems, which are nonetheless important.

Yesterday, the EPA unveiled new greenhouse gas emissions regulations for power plants that will cripple the coal industry and raise the cost of electricity exponentially for all American families.  Specifically, the EPA would require that all power plants cap their greenhouse gas emissions to the level of natural-gas power plants.  This rule will effectively eliminate any new construction of coal-fired power plants.  That’s nothing to sneeze at considering that coal fuels almost half of our electricity needs.  It will also effectively kill hundreds of thousands of jobs and necessarily raise the cost of the electricity on everyone – just as Obama promised during the 2008 elections.

You might be wondering how the EPA can get away with this administrative implementation of cap and trade after the legislation was defeated several years ago.  The answer is that they don’t have such authority, yet administrative power grabs have become the hallmark of this presidency.  Nevertheless, they can only succeed to the extent that Republicans let them off the hook.

Republicans are eager to register their indignation and protestations over this egregious rule and power grab.  But will they put their words into action and pledge to vote down any appropriations bill that continues to fund the EPA expenditures that are responsible for implementation of this regulation?

If they believe that this is such a winning issue, which it undoubtedly is, they must use their control of the House to force the issue in the months leading up to the elections.  Talk is cheap.