Costs of Inaction: Popular Climate Econ Model Needs Major Overhaul

by Frank Ackerman | March 15, 2011

Cross-posted from Real Climate Economics.

True or false: Risks of a climate catastrophe can be ignored, even as temperatures rise? The economic impact of climate change is no greater than the increased cost of air conditioning in a warmer future? The ideal temperature for agriculture could be 17 degrees C above historical levels?

All true, according to the increasingly popular FUND model of climate economics. It is one of three models used by the federal government’s Interagency Working Group to estimate the “social cost of carbon” – that is, the monetary value of the long-term damages done by greenhouse gas emissions. According to FUND, as used by the Working Group, the social cost of carbon is a mere $6 per ton of CO2. That translates into $0.06 per gallon of gasoline. Do you believe that a tax of $0.06 per gallon at the gas pump (and equivalent taxes on other fossil fuels) would solve the climate problem and pay for all future climate damages?

I didn’t believe it, either. But the FUND model is growing in acceptance as a standard for evaluation of climate economics. To explain the model’s apparent dismissal of potential harm, I undertook a study of the inner workings of FUND (with the help of an expert in the relevant software language) for E3 Network. Having looked under the hood, I’d say the model needs to be towed back to the shop for a ...

The Chamber Rides Again: Crazy Costs, Mythical Benefits

by Rena Steinzor | March 11, 2011
Not to be outdone by the Small Business Administration’s aptly named Office of Advocacy, the Chamber of Commerce has issued its own breathless report on how many jobs we could save if we did away with environmental, land use, and utility regulations. Crunching a bunch of dubious numbers, the SBA Office of Advocacy’s consultants, Nicole and Mark Crain, claim that regulations cost $1.75 trillion a year, a number several of my CPR colleagues thoroughly debunked in a report issued in ...

In Coming Utility MACT, EPA Has Clean Air Act Authority to Make Big Strides in Protecting Americans from Mercury Pollution

by Catherine O'Neill | March 11, 2011
By Wednesday of next week, EPA is due to publish its long-anticipated rule controlling mercury emissions from coal-fired utilities.  This is how we ought to judge the rule: does it follow the mandate of the Clean Air Act (CAA)? For too long, utilities have managed by various means to fend off regulation required by the CAA. Assuming EPA’s rule at long last complies with Congress’s directives, Americans may look forward to a day when they can again eat fish without serving their families ...

The BP Oil Spill: Hollow Regulation Meets Hobbled Law

by Sidney Shapiro | March 11, 2011
This coming April 20 will mark the one-year anniversary of the first day of the BP Oil Spill – a three-month polluta-polluza that eventually became the largest accidental marine oil spill in the history of the world. That was the night that a long series of failures finally came to a head: failures aboard the Deepwater Horizon by BP and its contractors, failures in the enforcement of regulations intended to prevent such disasters or at least limit the damage from them, ...

Adler Op-Ed: Utah Working to Shut the Door to Citizen Involvement in Environmental Decisions

by Ben Somberg | March 09, 2011
CPR Member Scholar Robert Adler has an op-ed in the Salt Lake Tribune looking at a series of developments in Utah -- administrative actions as well as pending legislation -- that could hinder citizen engagement in environmental decisions. The context, write Adler, is this: Whether or not one agrees that Tim DeChristopher was legally or morally justified in his civil disobedience as “bidder 70” in Bureau of Land Management oil and gas leases, virtually everyone asks why he did it. ...

EPA Appears Poised To Give Troubling Role to Cost-Benefit Analysis In Setting Rules on Power Plant Cooling Water

by Amy Sinden | March 04, 2011
When it comes to the use of cost-benefit analysis in setting environmental rules, it looks like President Obama's EPA has taken a big swig of industry’s Kool-Aid. We'll know for sure soon: The EPA has a March 14 deadline to issue its proposed Clean Water Act rule on cooling water intake structures at existing power plants and other facilities. But all signs seem to be pointing toward a highly formalized cost-benefit analysis resulting in a weak rule – and a ...

Press Examine Historical Evidence on the Costs of Regulation

by Ben Somberg | March 04, 2011
Industry representatives have long made exorbitant claims about the costs of regulations, only to be proven wrong again and again. And despite that history, anti-regulatory campaigners repeat the scariest statistics their own experts come up with, even if those statistics were meant to include a range of possible outcomes, or included caveats of uncertainty. An important batch of articles this week dug into these issues. Here are some of the highlights: Associated Press: Yet in testimony before House committees now ...

Michele Bachmann's Unconstitutional Light-Bulb Bill

by Daniel Farber | March 03, 2011
Cross-posted from Legal Planet. Michele Bachmann has introduced legislation to overturn the statute requiring the use of energy-efficient light bulbs, according to E&E News.  One  feature of the bill is its escape valve: Bachmann’s bill would allow the mandate to stand if the Government Accountability Office can prove the energy efficient bulbs would meet three criteria: that they provide real cost savings for consumers, significantly reduce carbon dioxide emissions and do not produce health risks for consumers. . . “Frankly, ...

EPA's New Boiler Rule Will Deliver Reduced -- But Still Huge -- Health Benefits

by Catherine O'Neill | February 24, 2011
This post was written by CPR Member Scholar Catherine O'Neill and Communications Specialist Ben Somberg. The announcement from EPA Wednesday creating final standards for pollution from industrial boilers is being described by the press as “scale[d] back,” and “half the cost of an earlier proposal.” Those things are true, but the new regulation is no small matter. It will have a significant and positive effect on the health of people across the country and beyond. Says the Sierra Club: "Though the ...

Williamson v. Mazda: Sound and Clear Preemption Decision

by William Buzbee | February 23, 2011
The Supreme Court today issued its much-awaited ruling in Williamson v. Mazda. Could an injured or deceased plaintiff sue under common law for damages allegedly attributable to the lack of a rear inner seat seatbelt, when the Department of Transportation (DOT) had declined to require such belts while requiring other seat belts?   The case on its face appeared much like the Court’s earlier Geier v. American Honda Motor Co decision, issued in 2000, in which the Court held that a common ...

Supreme Court Won't Hear Critical Habitat Cases

by Holly Doremus | February 23, 2011
Cross-posted from Legal Planet. The Supreme Court on Tuesday denied certiorari on two Endangered Species Act cases, Arizona Cattle Growers Association v. Salazar and Home Builders Association of Northern California v. US Fish and Wildlife Service. The cases were considered together because they raise the same issue: how the economic impacts of critical habitat designation should be calculated. Development and extraction interests hoped the Court would use the cases to force the U.S. to take a broader view of those ...

Cleanup Worker Safety Planning Must Not Get Forgotten in Fallout from BP Spill

by Matt Shudtz | February 22, 2011
Lizzie Grossman has a nice post over at The Pump Handle highlighting how the National Contingency Plan for major oil spills has significant gaps, which left government agencies and cleanup workers in the Gulf scrambling to figure out the right training programs and the best ways to protect workers' health and safety in the days, weeks, and months following the BP spill. But, as Lizzie points out, one of the most powerful advocates for fixing the NCP -- the National ...

Next Steps for America’s Great Outdoors

by Robert Verchick | February 21, 2011
If you’ve ever visited the Great Smoky Mountains National Park—one of the most visited national parks in the United States—you have Horace Kephart and George Masa to thank. These two men, the first a travel writer, the second a landscape photographer from Osaka, Japan, each settled among those six-thousand foot peaks with intentions of starting a new life in the American wild. Unfortunately, the timber industry had gotten there first and was soon mowing down forests at the rate of 60 ...

Who Wanted Ecuador to Try the Biggest Environmental Case in History? That Would be the Defendant, Chevron

by John Knox | February 18, 2011
On Monday, Valentine’s Day, a judge in Ecuador sent Chevron the opposite of a valentine: it ordered the giant oil company to pay $8.6 billion in damages and cleanup costs for harm caused by exploration and drilling by Texaco (acquired by Chevron in 2001) in a giant tract of rain forest near the headwaters of the Amazon River. The plaintiffs brought the class action on behalf of 30,000 indigenous residents of the region, who have long claimed that by dumping billions of ...

Judge Feldman is Still Mad

by Holly Doremus | February 18, 2011
Cross-posted from Legal Planet. You may remember Judge Martin Feldman from his decisions last summer enjoining enforcement of Interior’s first effort at a deepwater drilling moratorium, and more recently declaring that the Department must pay the legal fees of the plaintiffs in that case because it was in contempt of the injunction order. (For my take on those decisions see here and here.) No doubt the Department wished it could just slink out of the Gulf and never have to ...

Steinzor Testifies at E&C Hearing on Environmental Regulation, the Economy, and Jobs

by Rena Steinzor | February 15, 2011
CPR President Rena Steinzor is testifying at 1pm today before the House Energy & Commerce Subcommittee on Environment and the Economy. The hearing will be the latest in a string attempting to make a case that public health and safety protections must be weakened right now given the state of the economy. In her testimony, Steinzor argues: I appreciate that the majority feels it has a mandate as a result of the election. But I would urge all Members to ...

Republicans Propose Unconscionable Cuts for OSHA

by Thomas McGarity | February 14, 2011
On March 23, 2005, the worst industrial accident in 15 years killed 15 workers and injured more than 180 others as highly flammable liquids from a distillation tower were vented directly to the ground and were ignited by a spark at the huge BP Corporation Refinery in Texas City, Texas. A two-year investigation by the Chemical Safety and Hazard Investigation Board (CSHIB) concluded that the BP Texas City refinery was “an extremely dangerous workplace by any objective standard.” An “Independent Review Panel” ...

In Discussion about Regulation on the NewsHour, Darrell Issa Gets Casual with the Truth

by Matthew Freeman | February 11, 2011
On last night’s PBS NewsHour, Rep. Darrell Issa (R-CA), chair of the House Oversight and Government Reform Committee, took a shot at CPR’s Sidney Shapiro, who was the lone witness that Committee Democrats were allowed to invite to testify at yesterday’s  hearing on the costs of regulation. Issa badly mischaracterized Shapiro’s testimony, saying: The minority chose a witness. Mr. Shapiro spoke on behalf of his views, which were, in a nutshell -- and he reiterated them -- that he sees no ...

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