Guest Post by Willis Eschenbach
I’ve been discussing cost-benefit analyses lately. The AP has the story of a Federal judge who has just made a most excellent and far-reaching ruling regarding EPA cost-benefit analyses. He said that the EPA has to include the cost of lost jobs in the economic part of the cost-benefit analysis of their proposed coal regulations.
Now, I was shocked, but not surprised, to find out that the EPA did not include such an obvious cost in their analysis. It highlights the problem I’ve pointed out with these speculative looks at the future—the choice of what to include is quite broad, and subject to political winds.
But not including lost jobs? Man, that’s just heartless. Makes me wonder if lost jobs are included in the so-called “Social Cost of Carbon” … but I digress.
So the backstory is, the Federal judge had said that the EPA had to include the cost of lost jobs in their analysis. True to the general lawlessness of the Obama Administration, the EPA simply hadn’t obeyed the judge’s order. So the judge asked why.
Here was the part that set my hair on fire. I thought this was just about the coal regulations. But the head of the EPA, Gina McCarthy, obviously a current spokesmodel for the Peter Principle, said the following:
McCarthy asserted it would take the agency up to two years to devise a methodology to use to try to comply with the earlier ruling
Two years? World War II lasted four years for the US, and these wankers can’t put together a method to value lost jobs in two years? Glad they weren’t in charge back then … that’s just plain obstructionism.
The judge, understandably hit the roof. Among other things he said:
The judge said the EPA is required by law to analyze the economic impact on a continuing basis when enforcing the Clean Air Act and McCarthy’s response “evidences the continued hostility on the part of the EPA to acceptance of the mission established by Congress.”
Bailey ordered the EPA to identify facilities harmed by the regulations during the Obama presidency by July 1. That includes identifying facilities at risk of closure or reductions in employment.
… and …
The judge also set a Dec. 31 deadline for the EPA to provide documentation on how it is continuously evaluating the loss and shifts in employment that may result from administration and enforcement of the Clean Air Act.
The winningest part of this whole thing is that the judge said it doesn’t just apply to the coal rules. It applies to the whole Clean Air Act and by inference all of the EPA’s regulations.
Not only that, but his order specifically applies to any and every facility harmed during the Obama Administration by EPA regulations. Zowie! So there can be no doubt that it extends at least that far and farther.
And this in turn opens the door to overturning a whole host of existing regulations. All that needs to be done is to show that the cost of lost jobs was NOT considered in the EPA finding, and it would have to be reviewed … by the new Administration.
Finally, the judge spoke directly to the heart of the matter, saying:
“EPA does not get to decide whether compliance with (the law) is good policy, or would lead to too many difficulties for the agency,” Bailey wrote. “It is time for the EPA to recognize that Congress makes the law, and EPA must not only enforce the law, it must obey it.”
Good days, my friends, good days. Perhaps the EPA can get back to the actual environmental issues that all of us care about, liberal and conservative alike, the real issues of clean air and clean water.
The AP article is here …
w.
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Jobs are for little people. We will tell you what’s good for you. Now, give me half your money…
If I were the judge I’d find her in contempt of court and put her in jail until the EPA creates their methodology — and then I bet it would take a lot less that two years to do it. Two days at most.
My idea is that you put her in jail for one day. next day, check if they have complied. If not, jail her for an additional two days and review in one. If still no compliance, double the jail time for each day of noncompliance. Fairly soon, you will get her attention.
Wait! … IS NOT EPA … THE LAW?
A problem is how you calculate jobs lost. They could claim 2 “green” jobs created for each coal job lost.
And they might be right, even if it is crazy insane to have >2x more workers producing a kilowatt hour…
Peter
From memory, about a year ago GreenPeace boasted that the US solar industry had as many workers as the US oil & gas industries.
There was a deafening silence from GP when it was pointed out the latter produced 725x as much energy.
GreenPeace would have to have been counting solar installers in those figures. I seriously doubt they included filling station attendants for the other side.
Cost-benefit analysis can be a very useful tool for assessing the merits of alternative policies, so long as it is carried out by people who will undertake the task with rigour and without bias. Unfortunately, too often that is not the case, and political direction to favour a particular policy is accepted by those undertaking the analysis. My refusal to compromise led to the premature end of my career. Given that those who go to the EPA – as to the Dept of the Environment when I was in Canberra – are likely to be Green activists at heart, any EPA analysis should be undertaken by an independent body sufficiently established as not to bow to pressure to massage the outcomes.
You are of course correct. It would be laughable to assume an even balance of opinions within the EPA. I would expect the rank and file as well as the executive corp to consists mostly of ‘true believers’ with a few pseudo-scientists thrown in for show.
Genghis,
An analysis of the maintenance upkeep of a 200 unit condo association won’t alter the economy so my applied rate(s) are my problem (and are applied at my discrestion).
An analysis of a propposed regional dam project may alter the local economy, so I may go overboard and put a little more thought into the applied analysis rates.
But it seems to me that the acceptance of an analysis, that in the end would significantly change the national and global economy, would need a whole lot of wild ass guesses in the rate(s) application.
Have you ever addressed a cost benefit analysis of a system (eg. global co2 cost/benefit), for which the applied rate of return will be altered by the outcome of the analysis (when accepted and implemented)?
I had thought that deindustrialisation and the destruction of western economies was the whole point of the communist inspired environmental and sustainable development movements?
When I was doing contract work for the EPA in 70’s, 80’s and 90’s, it was their position that the Clean Air Act forbid them from considering the economic impact of their regulations. They only had to consider the health and welfare benefits of their regulations. Nice to see a Federal judge say otherwise. With the new administration, I doubt that the EPA will appeal the decision.
e
NMFS and the Dept of fish and bunnies tries to do the same thing with Endangered Species Act.
A few years back they (Fish & Bunnies) got a regulation enacted to clarify the “legality” of their rules/interpretation with respect to economic harms. They then went to court and sued (NMFS vs. FEMA) so as to be able to create new (more invasive) rules through the court, rather than through legislature. FEMA didn’t really care, didn’t fight, so NMFS won and put policy together that is eventually (Lousinana, you are next….) intended to protect millions of acres of (non) fish habitat & give NMFS regulatory power over a significant portion of the developed area in the country.
I hope ESA gets fixed (not eliminated) along with the Clean Air Act.
I voted to leave the European Union 23rd June 2016. They may do something about it in March 2017 if they feel so inclined. Can I suggest you don’t hope for too much so you are not disappointed.
And if they don’t leave by then what can we do? … Well we can do what the Americans did to get their independence, and that was for juries to refuse to convict.
Hallelujiah. A judge with who can think real issues through properly. Thanks for digging this out Willis. I see light at the end of he tunnel. It seems every one in the EPA would have failed my 1st year engineering project evaluation exams where we had to allow for everything. What they had to do really was a simple exercise but they could not even do that. How do these goofballs get their jobs?
How far should this be taken?
Do you discount jobs not really lost but moved elsewhere where there is need?
Do you count the cost of health care for people affected by emissions from coal-fired systems? In an insurance-based system, is that a benefit or a drag on the cost?
Do you count the jobs created for health professionals who are needed to care for people affected by emissions, and the jobs created for people who create medicines etc. needed for people affected by emissions?
Health professionals are needed also for those who cannot afford increasing energy prices.
That is not required by the Clean Air Act. The EPA was sued because the EPA was in violation of 42 U.S.C. § 7621, § 321(a) of the Clean Air Act, which requires the agency to “conduct continuing evaluations of potential loss or shifts of employment which may result from the administration or enforcement of the provision of [the Clean Air Act] and applicable implementation plans, including where appropriate, investigating threatened plant closures or reductions in employment allegedly resulting from such administration or enforcement.”
They lost.
The EPA is just a big part of the “De-Growth Movement”:
Thanks Willis for re-starting a dialog on this.
Also NMFS….
OK, you got me – what is NMFS, an acronym I can’t seem to locate?
BTW, this 10 minute video is worth listening to for a number of factors. He brings up the fact that one of the first big cases brought by the EPA was the fact that DDT was not harmful if used properly. The judge concluded in his hearing that it wasn’t harmful, but this decision was overturned by the head of the EPA.
He mentions that this de-industrialization targets the poor and developing nations. He mentions how the Corporate Average Fuel Economy (CAFE) standards are making cars less safe and increasing accident deaths and injuries because of less steel to make cars lighter.
He mentions about the anti air conditioner proposal is targeting the poor and developing nations.
Mark hits on a lot of other good points which we have discussed here at WUWT many times, and in simple lay terms… I recommend listening to this 10 min. professional video…JPP
OK, it is the National Marine Fisheries Service…just saw your post above.
Willis: The winningest part of this whole thing is that the judge said it doesn’t just apply to the coal rules. It applies to the whole Clean Air Act and by inference all of the EPA’s regulations.
From the article: The judge said the EPA is required by law to analyze the economic impact on a continuing basis when enforcing the Clean Air Act and McCarthy’s response “evidences the continued hostility on the part of the EPA to acceptance of the mission established by Congress.” Does not state it applies to all. What is true is that any regulations that Congress stated had to have economic analysis, they do.
Old Engineer: When I was doing contract work for the EPA in 70’s, 80’s and 90’s, it was their position that the Clean Air Act forbid them from considering the economic impact of their regulations. They only had to consider the health and welfare benefits of their regulations. Nice to see a Federal judge say otherwise. With the new administration, I doubt that the EPA will appeal the decision.
The Clean Air Act specifies that EPA continuously evaluate the impact of the Clean Air Act. When enforcing regulations, the EPA is not to consider them per se. It was supposed to occur on going not as part of individual site evaluation. Contrast this with the Clean Water Act with its NPDES, which is the national pollution discharge ELIMINATION system. The use of 7Q10 which is the lowest week flow in 10 years to reduce discharges, is the process of elimination, due to the well known phenomena of natural variance. The stopping point is best treatment. If a site does not have the money or space, for best treatment, if that is required, will have have its permit eventually withdrawn making discharges illegal. Worse, it is everybody on the modelled reaches where a parameter exceeded EPA safe discharge criteria. The program usually is MOD2E. Sites can and have been closed for not meeting or being able to meet the criteria.
One of the irritating aspects of this, is that those regulated by the CAA and amendments have been paying for this. CAA and CAAA require industry to cover costs of the program. As industry and regulated entities have left the US, the fees have been growing much faster than inflation. Lots of unfunded mandates ended up in the air category so that they could be afforded by the fees rather than by states spending their money. One of the historical parts relevant to this discussion, is that industry was to pay for this in fees. Letting the government know how much all this was really costing was one of the selling points to industry and those who were supporting their efforts at staying in business. So it is not just breaking the law, it is contra to the spirit of how enough of Congress came to sign off on it.
“As industry and regulated entities have left the US, the fees have been growing much faster than inflation.”
Sort of sounds like an unintended sunset clause don’t it.
“It is time for the EPA to recognize that Congress makes the law, and EPA must not only enforce the law, it must obey it.” Pure gold. LOL.
Only Big Government and its festering bureaucrats could possibly conceive (or fail to conceive) of performing a cost/benefit analysis.
I am embarrassed to admit that I had absolutely no idea they weren’t taking employment losses into account in their totalitarian edicts. It never crossed my mind that anyone could possibly be that stupid.
UNBELIEVABLE.
The powers that be failing to get their sums right? Surely not? There may be an ocean between us but the same thing happens here. The government and its agencies seem totally unable to include the full cost of its actions. Our dreadful ‘son of Brown’ chancellor George Osborne decided to make some changes to the tax on selling a house. It is a tax that a conservative government should consider removing but we have one of those in name only. It appeared that the tax was banded but many people didn’t realise that if your property fell in the 4% band it was taxed at that rate on the whole value. So in a sensible move Osborne introduced real banding so you paid different amounts on parts of the value. So far so good and saved me £3000. But in a foolish move designed to look like bashing rich people as Osborne used his budget statements to position himself to take over as Prime Minister from his mate Dave, he introduced new rates of 10% for houses of £925k-1.5m and 12% on over £1.5m. The inevitable and foreseen outcome was sales of houses over £925k fell off a cliff and still haven’t recovered. Net result – much less tax income. In and around London and the south-east, normal family houses fall into the 10% bracket and many are over £1.5m. They are not homes of the super rich – just ordinary people struggling to pay for an expensive house in the area they want to live. There have also been a lot of job loses in the house trade as people decided not to move as they couldn’t afford the tax hit.
Example 2: For decades the UK used a paper disc to show that the road tax for a vehicle had been paid. This has been the only system we have had and the only change was colours to clearly show if it was still valid or not. As a driver you could easily see when you would need to renew your tax. To save a claimed £14m the agency in charge decided to scrap this simple disc. Net result? You can probably guess that it is not a saving. In fact they have lost many times the supposed saving as failure to retax vehicles has soared. While some may be taking advantage of the change not to bother and hope not to be picked up by number plate recognition vehicles or the police, others are forgetting as the reminder system is no longer functioning as it was. But as usual there is no apology and suggestion of going back to the previous and obviously better and cheaper system amid claims that it is some how impossible. Oh for somebody like in the US to force them to.
There is only ONE case of common sense. The brewing industry managed to get the Treasury to consider that if they stopped constantly adding tax to beer the decline in consumption and reduction in tax could be turned around. Freezing or better still, reducing the tax, would result in growth in the industry and more tax, which is surely what they would want. And they actually included this in a model and AGREED that it would be a better policy. It all goes to show that Arthur Laffer was right.
There is a more general point, applying world-wide, based on this proper basis of assessing the net effects on jobs and costs when applying Green rules and assessing proposed Green projects.
The Green Brigade continually harp on about the jobs renewable power generation stations will provide but always fail to mention the jobs and even whole strategic industries that will be lost because of the massive directly and indirectly increased power unit costs. Clear evidence of these detrimental consequences is available in Europe and the USA.
They also always fail to mention the cost to others of the base load standby power generation costs and the additional and enhanced power transmission works needed – all of which has to be paid for by consumers, due to the varying and intermittent power outputs provided by, for instance, the totally uncontrollable changing tides, and capricious sun and winds and using such power from remote locations.
In addition, they also never include the significant benefits of increased CO2 in the atmosphere such as greening, which reduces water demand, increases fodder and the types of food available – clearly substantiated from satellite imaging, and increased crop yields, all of which are of global benefit.
This matter needs ramming down down the throats of the Green Brigade and our politicians and diplomats and civil servants from the UN downwards.
The whole Green Brigade CAGW/Climate Change religion is a fraud and grossly detrimental to the Earth and its people
Here in the UK, the Greens promoted diesel cars as a way to reduce CO2 emissions, even to the extent of persuading the government to halve the tax on some diesel models. Now they have (supposedly) found that diesels emit more of some other kinds of pollutant, so they are campaigning to have diesels banned from cities. The same diesels they told people to buy instead of petrol/gasoline cars.
It couldn’t get crazier. Well, unless their real motive is to wreck the transport infrastructure. If that is the objective, then it makes perfect sense for them to do that.
Couldn’t agree more! Diesel’s emit particulate carbon, carbon monoxide, and a range of nasty nitrates – all of which, unlike CO2, are real pollutants and the major cause of air pollution and smogs are their related illnesses and health risks. The solution has always been to use Liquified Natural Gas (LNG) engines which have been available for trains, lorries, vans and cars for 40 years or more. The LNG exhausts are simply water and CO2, nothing more, and CO2 is not a pollutant or otherwise a health risk!
No I do not think it is intentional it’s more do-gooders doing no good.
“Kindly let me help you because you will drown.”, said the the monkey, putting the fish safely up the tree.
The Milwaukee Journal Sentinel headline this morning in smaller print but at the top above the fold says:
State PSC also cut climate topics from website
Cheers
The social cost of carbon is obviously a new positive. If you are faced with a person that argues that it is a net negative, demand that they give you their car and tell them to go out and buy a bicycle. A net negative means it is bad and use of it should stop.
Net positive 🙂
Not winning until all the criminals in EPA, OSHA, FDA, DeptEnergy, Senate, House etc etc are frogmarched out of their offices by US Marshals, prosecuted and jailed. THAT is when America will be winning.
Well, at least he’s on the right track. But the whole point of the EPA’s anti-carbon coal regulations is to kill coal by putting it at an economic disadvantage. So the costs to the economy are far higher than lost jobs. Not to mention the elephant in the room: that cutting “carbon” has zero benefits either to the environment or to mankind.
Lost jobs? … Oops, we forgot. … Our dogs ate that analysis. … The person who was supposed to do that was sick that day. … The lead researcher was on vacation, and his instructions to his subordinates must have accidentally ended up in a spam folder and got deleted … “accidentally”.
ANYTHING but … It’s gonna take us up to two years to devise a methodology. That’s just verbose evasiveness, … passive aggressiveness, … or, my preferred technical term, lame.
Gina McCarthy, obstructionism: She has a track record of obstructionism. When Jeff Sessions asked her in a Senate hearing whether climate models had predicted correctly, she refused to answer, saying she didn’t know what models he was talking about. He was “stunned”. I’m no lawyer, but in a litigation under British law, and under oath, she would have been guilty of contempt of court.
You mean THESE climate models:
Very stylish. That’s what climate models are. They just have to look good. This was my point above. (^_^)
Very tight-fitting analogy.
Models can be wrecks underneath all that glamour. I’ve known a couple.
Okay, I think I’m done with that analogy now.
Hmmm…. I hear that Judith Curry might be available for a position in the New Administration.
What have ‘U Yoopers’ heard on that?
(We Hillfolk is all for it.)
Well, the good thing is the EPA is going to be gutted soon enough.
I like to think of these agencies as structures the country built in the past, which are in dire need of complete renovations. I hope and trust our new leader is up to that task.