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The British House of Commons recently passed a climate change bill mandating an 80 percent reduction in carbon dioxide levels over the next 40 years. Ironically, it was snowing outside when the bill was debated during London’s first October snow since 1922.
Neither the chill outside nor the freeze in England’s economy seemed consequential. In fact, neither Parliament nor the media bothered to discuss the £200 billion cost.
But now on this side of the pond, U.S. government officials are also proposing costly carbon dioxide reduction measures with restrictions identical to the British law. The $6.7 trillion dollar compliance cost will be passed on to consumers in the form of price increases to gas, oil, food and other products.
Speaker of the House Nancy Pelosi proudly stated last week that the bill will be introduced in January, never mind that the public is primarily focused on the country’s economic turmoil.
How much are you willing to pay for the promises associated with a carbon reduction program?
In a Heritage Foundation study of a similar measure that failed last summer, analysts found that
-By 2030, the U.S. Gross Domestic Product (GDP) would cumulatively lose between $1.7-$4.8 trillion from what would be otherwise projected.
-Single-year GDP losses would be between $111-$436 billion.
-The country would lose 500,000 to 1 million jobs by 2030; even after adding in the “green collar” jobs created by the proposal.
-The typical household would pay a total of $8,000 more for energy between 2012 and 2030.
(Read the study at )
On another front, the EPA is considering action to reduce carbon dioxide emissions from motor vehicles. This measure will actually exceed the cost of a climate change bill.
Heritage’s economic analysis estimates a $7 trillion cumulative decline in GDP by 2029 from such regulations and up to 3 million lost manufacturing jobs.
A basic principle of constitutional law is that legislation must be aimed at a public purpose and use means reasonably suited to achieving that purpose. When deciding the level of regulation, the government must strike a balance between the public purpose and the regulation’s burden on society.
In order to determine the benefit to the public, you need to know the costs of avoided risk. A comprehensive cost benefit analysis would allow officials to decide if the cost is worth it. To date, there is no reliable cost benefit analysis on which to base such a decision.
Accordingly, the cost of the proposed measures will unduly burden the public without any assurance of a positive outcome.
Supporters of the House climate change bill, which essentially adopts the European approach, should learn from the mistake the European Union made in adopting carbon reduction goals in 2005. Due to the global financial crisis, a growing number of EU countries rebelled last month, claiming that the plans to reduce carbon dioxide were now too expensive. The revolt by eight countries left the EU’s mission to create a global agreement on carbon emissions in disarray.
Instead of joining the carbon dioxide reduction race, the new U.S. administration should declare a temporary moratorium on carbon reduction measures, at least until our economy recovers. This hiatus could be used for further research including the preparation of a cost benefit analysis.
Our failing economy should be top priority in the months to come, not carbon reduction measures for which there are unlikely positive outcomes and guaranteed economic hardships.
- Valerie Fernandez is managing attorney at the Pacific Legal Foundation’s Atlantic Center in Stuart, Fla. pacificlegal.org
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