Bush MMS Director: 'When I Was There It Seemed to Work Well'
From the Wonk Room.

Johnnie Burton, former MMS director
As for allegations of lax enforcement at the Minerals Management Service, grossly inadequate spill response plans and other regulatory shortfalls, Burton said that as MMS director she was unaware of those problems. “I can’t answer all these questions at this point because when I was there it seemed to work well,” Burton said.
The agency worked so “well” that investigators found evidence of “cronyism and cover-ups of management blunders; capitulation to oil companies in disputes about payments; plunging morale among auditors; and unreliable data-gathering that often makes it impossible to determine how much money companies actually owe.”
Burton was in charge during the development of the offshore drilling plan that expanded drilling to the site of the Deepwater Horizon disaster. Her Outer Continental Shelf Oil and Gas Leasing Program 2007-2012 included 2008’s Lease Sale 206, in which BP purchased Mississippi Canyon Block 252 (MC252) for $34 million. MC252, also known as the Macondo Prospect, has been flooding the Gulf of Mexico with oil for months now. Burton’s plan dismissed the environmental threat of that sale, primarily because no huge disasters had taken place since the Ixtoc I blowout in 1979, as these excerpts show:The analysis above shows that with regard to potential oil spill impacts, areas that contain wetlands and marshes such as the Central GOM are particularly sensitive. However, lessees have been producing oil and gas from the Central Gulf and other areas for over 50 years with a remarkable record of environmental safety. For more than 30 years, there have been no significant oil spills from platforms anywhere on the OCS. [p. 92]No Environmental Justice impacts from accidental oil spills are expected because of the movement of oil and gas activities further away from coastal areas and, also, the demographic pattern of more affluent groups living in coastal areas. [p. 60]
The Central Gulf coastal area ranks second in marine primary productivity only to the Mid-Atlantic. The marine primary productivity of the Central Gulf does not appear to have been appreciably diminished by offshore exploration and production activities. The same is true of other areas of the OCS with existing operations and production. Thus, the size, location, and timing of lease sales in the PFP are consistent with the marine primary productivity of the areas in which lease sales will be held. [p. 95]
Overall, impacts on national parks, national wildlife refuges, national estuarine research reserves, and national estuary program sites due to routine operations are expected to be limited under the proposed action because these areas are restricted from development. Impacts from oil spills are unlikely because it is anticipated that 75 percent of the hydrocarbons developed, as a result of the 2007-2012 leasing program in the GOM area are expected to occur in deep water (>330 m) usually located far from the shoreline. [p. 57]
Any single large spill would likely affect only a small proportion of a given fish population within the GOM, and it is unlikely that fish resources would be permanently affected. [p. 57]
In areas with a large proportion of impact-sensitive industry, such as tourism, the potential incremental impacts of oil spills would likely result in a one-time seasonal decline in business activity. [p. 59]
Impacts of accidental releases to water quality would depend on the size of the spill, type of material or product spilled, and environmental factors at the time of the spill. However, there would be no long-term, widespread impairment of marine water quality. [p. 60]
I remember enough to tell you, for the five years I was there, we never relaxed any rules – never changed any rules to make them any less safe.
In fact, Burton’s MMS followed the Bush agenda of “increasing domestic oil and gas production, offering more incentives to drillers in the Gulf of Mexico and pushing to open the Arctic National Wildlife Refuge and other wilderness areas to drilling.” The “department trimmed spending on enforcement and cut back on auditors, and sped up approvals for drilling applications.” Auditing revenues plummeted by 86 percent from its 2000 peak even though oil prices soared, as Burton slashed auditing, fired effective auditors who challenged oil companies for bilking the American public and she resisted efforts to recoup money.
Thunder Horse platform, July 2005These are amazing times in the Gulf of Mexico. We are entering the second decade of sustained expansion of domestic oil and gas development in the deep water area of the Gulf.
The praise heaped on BP and the safety of offshore drilling from Secretary of the Interior Gale Norton, Burton’s boss, at the Thunder Horse celebration are painful in retrospect:
It is little noticed, and even less appreciated, but offshore production platforms have a remarkable safety record. Only about 1 percent of the oil in U.S. domestic waters comes from accidental spills, according to the most recent Oil in the Sea report from the National Academy of Sciences. . . .My second message today is about the importance of energy to the American economy, and the need for America to have its own domestic sources of energy. I recognize that this message is somewhat ironic, since today we are recognizing the accomplishment of a company well known as British Petroleum. Clearly part of what we celebrate today is the strong alliance that extends across the Atlantic Ocean. We recognize once again that two nations have grown from a common root, split apart, and matured. We feel assured that a business venture involving both nations is as secure as one done within our national borders.
Five months later, in July 2005, Hurricane Dennis nearly sank the Thunder Horse platform at Mississippi Canyon Block 778. After the dangerously listing platform was repaired, it was returned to production, where it continues to pump oil for BP and Exxon to this day, only a few dozen miles from the Deepwater Horizon wreck.
Harlan Watson Moves to House 1
E&E News reports that Harlan Watson, Bush’s Special Envoy to the United Nations Framework Convention on Climate Change at the U.S. Department of State, will join the minority staff of the House Select Committee on Energy Independence and Global Warming. As the lead negotiator for the United States, Watson opposed U.S. involvement in emissions reductions. Watson will become a “distinguished professional staff member” for Rep. James Sensenbrenner of Wisconsin, the ranking minority member of Rep. Ed Markey’s (D-MA) non-legislative committee.
In other staff moves: Sources tell Hill Heat that Andrew Wheeler, the Republican staff director for the Senate Committee on Environment and Public Works, is leaving Sen. James Inhofe’s (R-OK) employ.
White House Organizes Mayors Against EPA Global Warming Regulations
From the Wonk Room.
The Bush administration, though in the shadows of President-elect Barack Obama’s transition effort, continues to subvert the rule of law and impede action on global warming. Last week, the White House emailed mayors asking them to oppose the Environmental Protection Agency’s draft proposal for greenhouse gas regulations. According to the Washington Post, the email by Jeremy J. Broggi, associate director of the White House Office of Intergovernmental Affairs reminded mayors to formally submit complaints to the EPA:
At the time, President Bush warned that this was the wrong way to regulate emissions. Chairman John D. Dingell called it “a glorious mess.” And many of you contacted us to let us know how harmful this rule would be to the economies of the cities and counties you serve.
Broggi, a young Dick Cheney protegé, also linked to a November 20 U.S. Chamber of Commerce blog post by Bill Kovacs that makes the absurd claim regulation of carbon dioxide under the Clean Air Act “will operate as a de facto moratorium on major construction and infrastructure projects.” Broggi’s lobbying against his own government is nothing new—last year the Department of Transportation lobbied Congress to oppose global warming regulations.
To avoid action on global warming despite a direct order from the Supreme Court, Bush’s people have brazenly flouted their Constitutional obligation to faithfully execute the law, ignoring science, ignoring Congressional subpoenas, even ignoring emails from the EPA. Just as former attorney general Alberto Gonzales claimed the Geneva Convention’s ban on torture was “quaint,” EPA Administrator Stephen Johnson called the Clean Air Act “outdated” and “ill-suited” to the task of regulating greenhouse gas emissions.
However, it is the approach of the likes of George Bush, Stephen Johnson, Bill Kovacs, and John Dingell to the climate crisis that is “outdated,” “ill-suited,” and “a glorious mess”—not laws like the Clean Air Act. Robert Sussman, a Senior Fellow at the Center for American Progress Action Fund and co-chairman of Obama’s EPA transition team, explained last month:In fact, a new administration could enforce new global warming regulations with common sense, focusing on large emitters of greenhouse gases to achieve reasonable reductions while spurring trillions of dollars worth of economic growth and green-collar jobs.
Come January, Dingell will have been replaced as chairman of the House Energy and Commerce Committee by Rep. Henry Waxman (D-CA), and the Bush administration by Obama’s team. Sadly, Kovacs will continue plugging his dangerous message of inaction, although major companies are starting to abandon the Chamber’s reactionary rhetoric.
Broggi’s email reminded Bush’s allies in “bold, underlined text” that the public comment period for these proposed regulations closes this Friday, November 28. You can join the We Campaign in sending the message that the EPA can and should take immediate action to control global warming and to help repower America.
The text of the email follows.
From: White House Office of Intergovernmental Affairs
To:
Sent: Thursday, November 20, 2008 6:12 PM
Subject: Reminder of November 28 deadline to comment on the EPA ANPR on greenhouse gas emissions
On July 11 the EPA released an advanced notice of proposed rulemaking (ANPR) that suggests how the Clean Air Act might be used to regulate greenhouse gas emissions in our economy. At the time, President Bush warned that this was the wrong way to regulate emissions. Chairman John Dingell called it “a glorious mess”. And many of you contacted us to let us know how harmful this rule would be to the economies of the cities and counties you serve.
As you know, the White House asked the EPA to make the ANPR available for public comment, and has encouraged the public to do so. If you have planned to comment, this is a reminder that the comment period closes on November 28. Instructions on how to submit comments to the EPA can be found on their website: www.epa.gov/climatechange/anpr.html
You may be interested in reviewing the attached White House policy memo that lays out the issue in more detail. You may also be interested in reading the U.S. Chamber’s assessment of how the ANPR would affect various local building and infrastructure projects: www.chamberpost.com/2008/11/the-impact-climate-change-proposals-on-infrastructure.html
Please let us know if you have any questions.
Jeremy
Jeremy J. Broggi
Associate Director
Intergovernmental Affairs
The White House
Bush Administration Rushing Through Lame-Duck Energy And Environment Actions
- The Environmental Protection Agency (EPA) plans to finalize an NSR rule before the end of the administration that would essentially exempt all existing power plants from having to install new pollution control technology when these plants are updated.
- In a separate NSR rule, EPA plans to exempt so-called “fugitive” emissions – meaning emissions that don’t come out of the end of a stack such as volatile organic compounds emitted from leaking pipes and fittings at petroleum refineries – from consideration in determining whether NSR is triggered.
- EPA is also set to finalize a third rule weakening the NSR program, by allowing so-called “batch process facilities” – like oil refineries and chemical plants – to artificially ignore certain emissions when determining when NSR is triggered.
- EPA is also working towards weakening air pollution regulations on power plants and other emissions sources adjacent to national parks and other pristine, so-called “Class I” areas. By changing the modeling of new power plants’ impact on air quality in national parks – using annual emissions averages as opposed to shorter daily or monthly periods – the EPA rule will make it easier for such plants to be built close to parks.
- The National Highway Traffic Safety Administration (NHTSA) issued proposed regulations to implement the EISA fuel economy standards (increase by the maximum feasible amount each year, such that it reaches at least 35 miles per gallon by 2020) in April 2008, and final regulations are expected soon. If NHTSA used EIA’s higher gasoline price scenario—a range of $3.14/gallon in 2016 to $3.74/gallon in 2030—the technology is available to cost-effectively achieve a much higher fleet wide fuel economy of nearly 35 mpg in 2015 – instead of the 31.6 mpg in 2015 under the lower gas prices used in NHTSA’s proposed rule.
- EPA is expected to issue proposed regulations soon on the renewable fuels provisions passed in EISA that required America’s fuel supply to include 36 billion gallons of renewable fuels by 2022 – together with more specific volumetric requirements and lifecycle greenhouse gas benchmarks for “advanced” renewable fuels, cellulosic ethanol, and biodiesel.
- The Department of the Interior (DOI) has already telegraphed its intention to gut the Endangered Species Act by rushing through 300,000 comments on proposed rules in 32 hours, then providing a mere 10-day public comment period on the Environmental Assessment of the proposed rules change. The proposed rules would take expert scientific review out of many Endangered Species Act (ESA) processes, and could exempt the effects of global warming pollution on threatened or endangered species.
- DOI intends to finalize new regulations governing commercial development of oil shale on more than 2 million acres of public lands in the West.
- DOI’s Office of Surface Mining is expected before the end of the administration to issue a final rule that would extend the current rule (which requires a 100-foot buffer zone around streams to protect them from mining practices) so that it also applies to all other bodies of water, such as lakes, ponds and wetlands. But the rule would also exempt many harmful practices – such as permanent coal waste disposal facilities – and could even allow for changing a waterway’s flow.
- EPA has already missed several deadlines to finalize a rule addressing whether concentrated animal feeding operations (CAFOs) are required to obtain permits under the Clean Water Act.
- EPA and the Army Corps of Engineers may issue a revised guidance memo on how to interpret the phrase “waters of the United States” in the Clean Water Act, which determines what water bodies are subject to regulation under the Act.
- Under the Omnibus appropriations bill for FY 2008, EPA was directed to establish a mandatory reporting rule for greenhouse gas emissions, using its existing authority under the Clean Air Act, by September 2008. EPA has been working on a proposed rule, which may or may not be issued before the end of the Bush administration. EPA will not issue a final rule before the end of the administration.
Bush Exploits Hurricane Gustav To Demand More Offshore Drilling
From the Wonk Room.
President Bush exploited this morning’s press briefing on the “follow-up efforts” to Hurricane Gustav to attack Congress about lifting the offshore drilling moratorium. Stating that “what happens after the storm passes is as important as what happens prior to the storm arriving,” he made the declaration that “our discussion here today is about energy.” Bush wasn’t referring to the 1.4 million Louisianans who have lost power due to the storm’s destructive force, and chose not to mention the 102 deaths caused by Gustav. Instead, he went on the attack:I know that Congress has been on recess for a while, but this issue hasn’t gone away. And, uh, this storm should not cause members of Congress say well, we don’t need to address our energy independence. It ought to cause the Congress to step up their need to address our dependence on foreign oil. And one place to do so is to give us a chance to explore in environmentally friendly ways on the Outer Continental Shelf.Watch it:
MSNBC’s Mika Brzezinski and Joe Scarborough were both floored by Bush’s decision “to use another hurricane in Louisiana to promote offshore drilling at this point,” after he “performed so poorly during Hurricane Katrina.”
Bush’s tasteless politicization of an ongoing civil emergency repeated tired right-wing talking points. As Van Jones told the Wonk Room last week, Bush is selling false solutions and more pollution:Let’s be very clear. Number one: There’s no such thing as American oil any more. These are multinational corporations. If you let multinational corporations drill all this oil, they’re going to sell it to the highest bidder, whether it’s China, or India, it doesn’t matter. Why would we throw away America’s beauty chasing the lost drops of oil, so multinational corporations can sell it to India and China?And people also got to remember, we didn’t stop this as an environmental issue. We didn’t stop offshore drilling for the duckies and the fishies. We stopped it because coastline communities were suffering. Because the property owners, the children who live in those coastline communities – not when there were oil spills – but every day, when your child goes out to swim, he comes back covered in oil, you have to use gasoline to get the oil off your child. That was happening coast to coast
Transcript:
BRZEZINSKI: Okay, that was President Bush giving reporters an update on the situation to the hurricane. And nicely weaving in a little pitch for off-shore oil drilling!SCARBOROUGH: I was going to say, Mika. Anybody, anybody that thought this would be the warm and fuzzy George Bush, who would have a tear in his eye and say, “You know, maybe we didn’t have everything right last time, but this time we are worried about the Americans who have,”—no, he turned it around, “Drill now.”
BRZEZINSKI: Drill, drill, drill.
SCARBOROUGH: Drill here, drill now.
BRZEZINSKI: But in all seriousness, at the top of the hour we’ll be hearing from the director of homeland security as well as governor Bobby Jindal.
...
SCARBOROUGH: I’ve got to agree with the mayor. For this president, that performed so poorly during Hurricane Katrina to use another hurricane in Louisiana to promote offshore drilling at this point…
BRZEZINSKI: (Laughing) It was like going from music to news to the top of the hour.
SCARBOROUGH: You know who was screaming the loudest?
BRZEZINSKI: Who?
SCARBOROUGH: The McCain campaign …
BRZEZINSKI: (Sighing) Ohhh…
SCARBOROUGH: ...while they were watching the president. “Just stop, just stop!” Not warm and fuzzy.
Climate Obstructionist Nominated For Federal Judiciary
While Burnett charitably described it as a “robust interagency process” he was taken aback by OMB general counsel Jeff Rosen’s ignorance about global warming-causing carbon dioxide molecules. Rosen requested that EPA only count carbon dioxide molecules in the air that came from automobiles, not ones from power plants. “It was sometimes embarrassing,” Burnett said, “For me to return to EPA and say that I had to explain to OMB that carbon dioxide is a molecule and you can’t differentiate in the air where a molecule came from.”
Burnett’s exasperation with Rosen was, unsurprisingly, not shared at the White House. In fact, the exact opposite seems to be the case. It turns out that about a month ago, President Bush nominated Rosen for a lifetime appointment to the U.S. District Court for the District of Columbia.
Rosen was also recently involved OMB’s efforts to resist a subpoena from the House Oversight and Government Reform Committee, ending with the invocation of executive privilege in order to avoid a contempt of Congress vote for Deputy Administrator Susan Dudley. Prior to joining OMB in June 2006, he served as General Counsel for the Department of Transportation. During that time, DOT promulgated fuel economy standards for light trucks that were later invalidated by the 9th Circuit Court of Appeals, which ruled that their biases toward the auto industry and failure to account for climate-change impacts represented an “arbitrary and capricious” violation of the Energy Policy Conservation Act (EPCA) and National Environmental Policy Act (EPCA).
This nomination is particularly noteworthy given the D.C. District Court’s special powers to hear environmental cases—including some cases brought under the Clean Air Act. But with mere months to go in President Bush’s term and the obvious, serious concerns that Rosen would need to address before meriting confirmation, it’s somehow doubtful that the Senate Judiciary Committee will hasten to act on his nomination.
In Draft of Greenhouse Gases Regulations, Bush Administration Attacks Clean Air Act
From the Wonk Room.
After over a year of battles with the White House and other federal agencies, the Environmental Protection Agency has published its response to the April 2007 Supreme Court ruling in Massachusetts v. EPA, which mandated that the agency determine whether greenhouse gases pose a threat to our health and welfare and take action in response. With today’s publication of an “Advance Notice of Proposed Rulemaking,” EPA Administrator Stephen Johnson ignores the threat and attacks the rule of law.
Johnson published his staff’s document – after extensive cuts from the White House – with complaints attached from the White House Office of Management and Budget, the White House Council on Environmental Quality, the White House Council of Economic Advisers, the White House Office of Science and Technology Policy, the Department of Transportation, the U.S. Small Business Administration, the Department of Agriculture, the Department of Commerce, and the Department of Energy.
In one voice, the other agencies attack the use of the Clean Air Act to regulate greenhouse gases as “deeply flawed and unsuitable,” “fundamentally ill-suited,” “extraordinarily intrusive and burdensome,” “unilateral and extraordinarily burdensome,” “drastic,” “dramatic,” “excessive,” “extremely expensive,” and “costly and burdensome.” The clear and present threat of global warming is dismissed as a “complex” issue that hinges on “interpretation of statutory terms.”
Sadly, Johnson decided to join them, attacking the immense work done by his staff to address the catastrophic threat of climate change:I believe the ANPR demonstrates the Clean Air Act, an outdated law originally enacted to control regional pollutants that cause direct health effects, is ill-suited for the task of regulating global greenhouse gases.
In his press conference announcing the release of today’s decision, Johnson reiterated his opinion that the Clean Air Act is the “wrong tool” for the task, “trying to fit a square peg in a round hole.”
This is yet another case where Johnson is following the example of the likes of disgraced former Attorney General Alberto Gonzales, who made similar statements about the Geneva Conventions’ ban on torture as White House Counsel:As you have said, the war against terrorism is a new kind of war. The nature of the new war places a high premium on other factors, such as the ability to quickly obtain information from captured terrorists and their sponsors in order to avoid further atrocities against American civilians. In my judgment, this new paradigm renders obsolete Geneva’s strict limitations on questioning of enemy prisoners and renders quaint some of its provisions.Similarly, the White House’s arguments in defense of ignoring the Foreign Intelligence Surveillance Act’s ban on warrantless wiretapping:
Reverting to the outdated FISA statute risks our national security. FISA’s outdated provisions created dangerous intelligence gaps, which is why Congress passed the Protect America Act in the first place.
George W. Bush, Stephen Johnson, and the other officers of the executive branch swore an oath to “faithfully execute” their office and defend the Constitution. They have evidently decided to break that vow, time and again. In the Alice-in-Wonderland world of the Bush administration, it’s always the “quaint,” “outdated,” “burdensome,” and “ill-suited” laws that are the problem—never their reckless abandonment of principle and duty.
White House Threatens Veto of Lieberman-Warner
The White House has issued a Statement of Administrative Policy (SAP) on the Lieberman-Warner Climate Security Act (S. 3036), indicating that President Bush will veto the bill, citing fundamental differences with its approach, including mandatory emissions reductions and carbon pricing. The full text of the SAP is below.
STATEMENT OF ADMINISTRATION POLICY
S. 3036 – Lieberman-Warner Climate Security Act
(Sen. Boxer (D) CA)
The Administration believes that climate change is an important issue and is taking significant domestic and international actions to address it. As Congress debates this important issue, it must recognize that bad legislation would raise fuel prices and raise taxes on Americans without accomplishing the important goals the Administration shares. This debate should be guided by certain core principles and a clear appreciation that there is a right way and a wrong way to approach reducing greenhouse gas emissions.
The right way is:The wrong way, as reflected by S. 3036 and the Boxer Amendment, is:
- to set realistic goals for reducing emissions consistent with advances in technology, while increasing our energy security and ensuring growth in our economy;
- to adopt policies that spur investment in new technologies needed to reduce greenhouse gas (GHG) emissions without unreasonable burdens on consumers and workers;
- to expand emission-free nuclear power generation and encourage the investments necessary to produce electricity from coal without releasing carbon into the air;
- to ensure that all major economies are bound to take action and to work cooperatively with our partners for a fair and effective international climate agreement;
- to lower trade barriers and create a global free market for clean energy technologies, making advanced technology more affordable and available in the developing world; and
- to prevent the misapplication of other environmental laws, such as the Clean Air Act, the Endangered Species Act and the National Environmental Policy Act, not designed to address greenhouse gases as part of any new GHG specific framework.
For these and other reasons stated below, the President would veto this bill.
- to sharply raise the price of gas, raise taxes, or demand drastic emissions cuts that have no chance of being realized and every chance of hurting our economy;
- to impose burdensome new mandates on top of ones that were enacted just last year;
- to leave limitations on nuclear power generation and waste disposal unaddressed;
- to establish unrealistic timeframes for massively restructuring the economy that assume the use of technologies not yet developed or demonstrated to be economically feasible;
- to create a system that will squeeze household income, cost many jobs, reduce growth in the economy, impose a huge new tax, and create uncontrolled spending;
- to take unilateral action that will undercut efforts to get developing countries to limit their emissions while having negligible effect on GHG concentrations and global temperatures;
- to impose counterproductive provisions that could ignite a carbon-based trade war; and
- to allow the misapplication of a patchwork of 30-year-old laws that were not designed to regulate greenhouse gas emissions.
The Administration is taking serious steps to address climate change. By the end of this Administration, the Federal government will have spent almost $45 billion to support climate change-related programs, with $40 billion in loan guarantees made available to support investments in technologies that will reduce greenhouse gases. Further, the recently enacted Energy Independence and Security Act of 2007, which generally followed the President’s “Twenty in Ten” Initiative, will reduce GHG emissions by billions of tons. Additionally, the Administration is working with all major economies and through the United Nations negotiation process to ensure a new international climate change framework is both environmentally effective and economically sustainable.
At the outset, S. 3036 fails to address the misapplication to GHG emissions of statutes that clearly were not designed specifically to regulate these global emissions, such as the Clean Air Act, the Endangered Species Act, and the National Environmental Policy Act. It also fails to align its new mandates with those enacted just five months ago governing fuel economy, alternative fuels production, and energy efficiency. The bill would add to, rather than substitute for, a 30-year patchwork of environmental laws that would impose a great cost on the economy, and would create misallocations of economic resources, statutory conflict and confusion, and perpetual litigation. The bill also permits a State, without any precondition, to impose more stringent GHG emission restrictions, thereby rendering the bill potentially a mere floor to fifty separate regulatory regimes, in which one state could seek to regulate the economies of others.
Hurts ConsumersLegislation on this important issue should balance three goals: address climate change, increase energy security, and facilitate economic growth. This legislation lacks this balance and sacrifices consumer welfare and economic growth for marginal reductions in future global GHG concentrations. Consequently, the impact on consumers from the combination of the high compliance costs and the new tax and spend programs would be enormous. The current national average gasoline price is nearing $4 per gallon. This bill would increase gasoline prices another $0.53 per gallon relative to the expected price in 2030 and another $1.40 per gallon relative to the expected price in 2050. Furthermore, it would increase electricity prices 44 percent in 2030 and 26 percent in 2050. The combined effects of this bill would diminish household disposable income – EPA estimates this bill would reduce a typical American household’s purchases by nearly $1400 in 2030 and as much as $4400 in 2050.
Shrinks the EconomyS. 3036 is likely to severely damage the economy and drive jobs overseas. As an example, the Environmental Protection Agency (EPA) and the Energy Information Administration have estimated, respectively, that the bill as reported could reduce U.S. Gross Domestic Product by as much as seven percent (over $2.8 trillion) in 2050, and reduce U.S. manufacturing output by almost 10 percent in 2030 – before even half of the bill’s required reductions have taken effect.
Imposes Excessive Regulatory CostsS. 3036’s approach to reducing greenhouse gases would force drastic and costly emission cuts. EPA estimates the costs necessary to achieve this GHG abatement are on the order of $10 trillion through 2050. This would make S. 3036 by far the single most expensive regulatory bill in our Nation’s history. These costs would be passed on to consumers through higher electricity and heating bills and increased gasoline costs. In fact, the abatement costs for this bill are estimated to be approximately three times as much as previous Senate climate bills analyzed by EPA.
Implements a Tax and Spend SystemS. 3036 and the Boxer Amendment would, in effect, constitute one of the largest tax and spend bills in our Nation’s history, costing Americans dramatically more than the BTU energy tax proposals rejected by the Congress in 1993. Furthermore, the bill’s inefficient allocation scheme for emission allowances would create arbitrary winners and losers and inefficiently distort economic incentives for production and innovation.
Based on EPA’s recent analysis, the bill would raise approximately $6.2 trillion in constant dollars ($11.8 trillion with inflation) through the auction of GHG emission allowances to owners and operators of utilities and factories who would have to purchase allowances to stay in business. In addition, the bill gives away allowances valued at $3.2 trillion for auction by States, foreign governments, and private entities. The cost of purchasing these allowances also would be passed on to consumers as higher prices. This would amount to a regressive “stealth” tax that would hit low and middle income working families hardest.
Expands Mandatory Spending IrresponsiblyThis new tax would take funds out of consumers’ wallets to add $2.6 trillion through 2050 in new mandatory, automatic spending, which already consumes 62 percent of the Federal budget. For example, the bill includes $346 billion in entitlement spending on new training and income support programs at the Department of Labor, and $750 billion in new mandatory foreign aid financed by auction revenue and emission allowance giveaways to foreign countries, without any control or oversight through the annual appropriations process.
Creates New BureaucraciesThe bill creates a new Climate Change Technology Board, as a so-called independent agency, with the authority to distribute $750 billion worth of funding and emissions allowances through 2050 to finance various energy efficiency programs. The bill also creates a new International Climate Change Commission, which would have the authority to determine whether foreign countries are taking sufficient action to prevent climate change and to undertake enforcement actions, such as the prohibition of certain imports, as a penalty for countries that do not take sufficient steps. The establishment of these unaccountable entities raises serious constitutional concerns, particularly with respect to the restrictions placed upon the President’s authority to both appoint and remove members of these entities.
Risks Trade ConflictsThe provisions for international reserve allowances would harm efforts to persuade major developing countries to take action to limit their GHG emissions. Reserve allowances effectively impose an import surcharge which would lead to higher prices for U.S. consumers and could lead targeted countries to impose similar restrictions on U.S. exports based on their own unilateral definitions of comparable action. That would result in serious trade conflicts and impose significant costs on the U.S. and global economies. Major developing economies would be less, not more, amenable to make hard choices in international climate negotiations. Thus, these provisions would be counterproductive to U.S. efforts to ensure that all major GHG emitting developing countries commit to concrete national actions to limit emissions. Rather than relying on the prospect of punitive trade sanctions, an effort should be made to foster trade liberalization to promote economic growth and the deployment of clean technologies.
Fails to Achieve Stated GoalsThe bill’s unilateral approach would jeopardize American competitiveness and drive jobs abroad, often simply relocating greenhouse gas emissions to other countries, rather than reducing them. These steep domestic costs would thus be accompanied by only minuscule changes in global concentrations of greenhouse gases – between 7-10 parts per million (ppm),or 1-2 percent, in 2050, and 25 – 28 ppm, or 3-5 percent, in 2095, as estimated by EPA. For comparison, an increase of 90 ppm would result in roughly a one degree Celsius increase in the global temperature, based on Intergovernmental Panel on Climate Change estimates.
Expands Davis-Bacon ActThe substitute would expand Davis-Bacon Act prevailing wage requirements to cover several new programs of grants and “rewards” for projects relating to renewable energy, low or zero carbon generation technology, and carbon capture technologies that are authorized under the bill. Such an expansion is contrary to the Administration’s longstanding policy of opposing any expansion of the application of the Davis-Bacon Act’s prevailing wage requirements.
Creates Legal ProblemsSeveral provisions in the bill purport to direct or burden the conduct of foreign relations relating to climate change in a manner inconsistent with the constitutional authority of the President to conduct foreign policy and to safeguard sensitive diplomatic information. In addition, the bill, as amended, would authorize the President to modify any requirement of this bill, for a specified time period, if he determines that a national security, energy security, or economic security emergency exists and that doing so is in the paramount interest of the United States. However, the bill raises practical and constitutional concerns by making the President’s decision subject to legislative and judicial oversight.
Bush Criticizes Lieberman-Warner Bill
Today the Senate is debating a bill called the Warner-Lieberman bill, which would impose roughly $6 trillion of new costs on the America economy. There’s a much better way to address the environment than imposing these costs on the job creators, which will ultimately have to be borne by American consumers. And I urge the Congress to be very careful about running up enormous costs for future generations of Americans.We’ll work with the Congress, but the idea of a huge spending bill fueled by taxes – increases – isn’t the right way to proceed. And the right way for Congress to proceed on taxes in general is to send a clear message that the tax relief we passed need to be made permanent.