Social Distortion: President Obama Looks to ‘Social Cost of Carbon’ to Tap Into Taxpayers’ Wallets

EPA building (Washington, D.C.)

One of the key hallmarks of the Obama Administration is their perpetual use of the regulatory process as a means to accomplish goals that cannot be done within the scope of the normal way of passing legislation through Congress. A key element is the direction and power the President gives to his executive branch agencies to carry out these harmful regulatory ‘recommendations’. The latest example is the so-called ‘social cost of carbon’ being used by the Obama Administration as a means to yet again impose more costs on taxpayers and consumers.

According to Reason, the social cost of carbon refers to “the economic and ecological damage caused each time we add a ton of carbon dioxide to the atmosphere by burning fossil fuels.” The hitch is that is the figures were put together in 2010 by the White House Interagency Working Group using questionable computer models and outdated information with which projections were being based upon to reach a cost assessment. The original estimation by the group and agreed upon by the Administration was recently revised upwards setting off a chain reaction that has put this issue at the forefront in Congress as many members view this as just another way to burden businesses, consumers, and taxpayers with needless and counterproductive regulations.

Last month, Congressman Duncan Hunter (R-Calif.) introduced H.R. 2886, the “Social Cost of Carbon Transparency Enhancement Act of 2013,” which would, according to The Washington Times,  “bar the Environmental Protection Agency and other arms of the government from using cost-of-carbon metrics until they have been subject to comment and review by Congress and the American public.” H.R. 2886 is not the only legislative option being considered, there are multiple bills that have been making their way throughout the last few months. Shortly before the August recess, Congress approved an amendment offered by Rep. Tim Murphy (R-Pa.) to the Energy Consumers Relief Act directly challenging the social cost of carbon.  According to The Hill, Rep. Murphy’s amendment would “prevent the Environmental Protection Agency (EPA) from calculating the social cost of carbon in the benefits of an energy-related rule costing over $1 billion unless Congress passes a law authorizing its use.” The goal is to ensure that the proper checks and balances can be kept in place and prevent another wave of new regulations based on a dubious system that will harm taxpayers and take more out of their pockets.

The criticism of this approach ranges from legality, to scientific authenticity, to the economic impact.  And, in all of these instances the conclusion is the same: the social cost of carbon is not the answer. CATO, the largest libertarian think tank in the country recently described a few of these flaws:

“The administration dismisses federal guidelines which require an analysis of the cost of regulations from a domestic perspective. Rather than focusing only on costs expected to occur in the U.S., the administration determines the social cost of carbon from a consideration of perceived global impacts… what the administration is essentially doing is claiming ill-defined foreign benefits to justify the costs of U.S. regulations.

More egregiously, the administration turns its back on science. There is growing realization among climate scientists that the projections of climate change resulting from human greenhouse gas emissions have been overestimated… even while admitting that the climate sensitivity to greenhouse gas emissions is a key parameter in its calculations, the administration ignores these new findings and instead increased its estimate of the social cost of carbon in the face of the best science which demands that they should have decreased it.”

While many advocates in and out of the Obama White House claim this will help to generate growth in the economy, there is evidence that not only are they wrong but also that it will depress the economy. Writing in National Review Online, Robert Zubrin looked at GDP data in relation to carbon usage and concluded that, “each ton of carbon denied to the world economy destroys about $6,700 worth of wealth. That is the difference between life and death for a Third World family. Seven tons denied corresponds to a loss of $47,000, or a good American job.” The White House seems determined to implement a regulatory apparatus determined to derail opportunities that could be beneficial to the overall well-being of the economic stability of the nation, all for the sake creating more rules that placate the hidden agenda of environmental special interests.

The social cost of carbon appears to be yet another attempt at a regulatory power grab that will line the pockets of the government bureaucrats while costing businesses, consumers, and taxpayers far more than they can afford.