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“Supreme Court; If It’s Worth It For Corporations, Pollution May Be Okay”: EPA Can Only Regulate Pollution When It’s Cost-Effective

While LGBTs and healthcare reformers are still nursing their celebratory hangovers, the final Supreme Court case of the 2014-15 term just junked twenty years of environmental regulations.

The case, Michigan v. EPA, specifically dealt with the EPA’s regulation of mercury emissions from power plants under the Clean Air Act—a long, twenty-year process that has been opposed by industry at every turn, even as mercury air pollution from coal-fired power plants has ++irreparably poisoned the Great Lakes .

Today, the clock has been set back. In its third 5-4 decision of the day, with Justice Kennedy again providing the swing vote, industry has prevailed. Writing for the court, Justice Scalia held that the EPA had to factor in costs in deciding whether to regulate, not just how to regulate.

If you think about it, this is an impossible task practically and philosophically.

Practically speaking, the regulatory process for mercury has lasted twenty years—in large part because the EPA weighed dozens of options, evaluating the costs and benefits of each. Today’s decision requires the EPA to balance costs and benefits at the very beginning of the process, before either the costs or the benefits are known.

EPA’s position was that, while costs must, of course, be taken into account in deciding how to regulate toxic chemicals like mercury, the initial decision of whether to regulate them should not be dictated by how much it costs to do so. What matters at that point—whether regulation is “appropriate and necessary” under the statute—is only whether public health is at stake.

In policy-speak—as I wrote in a law review article twenty years ago—the difference is between “risk assessment” and “risk management.” Risk assessment is when you notice a leak in your basement, and decide you have to do something about it. Risk management is when you evaluate your options, and decide what to do.

The difference is obvious, and intuitive. But it does mean that the initial decision may not take cost into account.

Thus the EPA argued that the words “appropriate and necessary” do not imply a balancing of costs and benefits, only a determination of public health. Justice Scalia said this was not “reasonable decisionmaking.” As Justice Kagan said in her dissent, the EPA took costs into account later in the regulatory process. But Justice Scalia said that is not enough—the initial decision, too, must include costs.

This is as incoherent philosophically as it is practically. Think about it this way: Who owns the right to your health?

In the EPA’s reasoning, you do. Under the Clean Air Act, if someone else’s activities are going to meaningfully endanger your health, the government is entitled to stop them.

In Justice Scalia’s reasoning, now the law of the land, the toxic chemical emitters do. If it is economically efficient to poison you with mercury—if the costs to them outweigh the benefits to you, calculating an economic value of your health—then they get to do it.

If this seems outrageous, it’s because it is. Justice Scalia had to focus exclusively on the first sliver of the regulatory process in order to make his argument. “EPA’s interpretation precludes the Agency from considering any type of cost,” he writes. But that’s only true at the initial decision of whether to regulate or not (risk assessment). In subsequent decisions of how to regulate (risk management), cost was taken into account many times.

Which is what makes sense philosophically, as well as practically. Deciding whether to regulate a toxic substance should not be an economic decision. Deciding how to do so should be—of course, the government should choose the most efficient method of regulation, and balance costs and benefits appropriately. But the decision of whether a toxic substance is toxic is a matter of science, not money.

Zooming back a bit, Michigan v. US now starts to look a lot like the corporations-are-people cases like Citizens United and Hobby Lobby. In this growing body of cases, corporate interests have been equated with individual ones. Corporations have rights to free speech and the free exercise of religion.

Now their right to make money running dirty power plants is equated with the right of human beings to breathe free of mercury pollution. Your rights, their rights—what’s the difference?

Ironically, Justice Scalia’s originalism—which last week had him arguing that if a practice could be banned in 1868, it could be banned in 2015—would have cut the other way here, if he took it seriously. For the first hundred years of US history, there were no corporations as we know them today. Corporate charters were time-bound, limited, and revocable. Only in the Gilded Age did they attain “legal personhood” as we know it today.

This is the point conservatives often miss in decrying the growth of government and regulation. Yes, government has grown well beyond anything the Founders could have imagined. But the Founders could not have imagined today’s mega-corporations either.

Peabody Energy, one of the primary backers of the current lawsuit, has an annual revenue of $6.79 billion. In 1812, the largest non-banking corporation in America, the American Fur Company, was worth about $1 million—about $17.2 million in 2015 dollars.

In other words, just one of the corporations fighting the EPA’s mercury regulations is worth 394 times the largest US corporation in existence two centuries ago. While the growth in governmental power since then, represented by regulations like the Clean Air Act, has indeed been significant, it is dwarfed by the growth in corporate power.

Michigan v. US now stands for the principle that corporate interests are equal in kind to human interests. Whether the EPA should regulate mercury depends on whether it’s cost-effective to do so, treating the costs to industry and the benefits to health equally.

Because corporations are people, right?

 

By: Jay Michaelson, The Daily Beast, June 29, 2015

July 1, 2015 Posted by | Clean Air Act, Environment, Michigan v EPA | , , , , , , , | 1 Comment

“Working For The Same Boss”: The Coal Industry Is Imploding. Why Is it Still So Powerful in Washington?

As its battle against the Obama administration’s Clean Power Plan intensifies, Big Coal is getting a lot of help from friends in high places.

Leading the rush to the industry’s defense is Senate majority leader Mitch McConnell, who has launched an underhanded campaign to undermine the Environmental Protection Agency’s new rules for greenhouse gases from power plants. In a March 3 op-ed, McConnell suggested that states should refuse to submit a state plan for lowering emissions. A few weeks later he sent a letter directly to every governor in the country, warning that developing such a plan would allow “the EPA to wrest control of a state’s energy policy.”

To further encourage states to opt out of the rules, McConnell and co-sponsors Rob Portman, Roy Blunt, Tom Cotton and Orrin Hatch put forth an amendment to a budget resolution on Wednesday that would allow a state’s governor or legislature to duck the EPA’s authority if they determined that adopting a plan to reduce emissions would hurt their state. (A similar measure is pending in the House.) In order to opt out, according to David Doniger of the National Resources Defense Council, all a state would need to do is “to declare that meeting carbon standards would cost the polluters money.”

McConnell’s bases his appeal to the states on the claim that the regulations are “probably” illegal. In this argument he is is backed by “iconic liberal constitutional scholar Laurence Tribe,” who, McConnell practically crows, “was President Obama’s constitutional law professor at Harvard Law School.” In recent months Tribe has been busy writing legal briefs and op-eds and trotting himself out before the House Energy and Commerce Committee to make that case that the EPA’s attempt to regulate greenhouse gases under the Clean Air Act is an egregious act of overreach akin to “burning the Constitution.” Tribe goes well beyond questions of legality, however, as Jonathan Chait points out, defending coal as a time-honored home-dug alternative to foreign oil.

Tribe’s starring role in McConnell’s circus is unexpected, but it’s not hard to explain: They’re working for the same boss. Tribe was hired to assail the Clean Energy Plan by Peabody Energy, the nation’s largest coal producer—and also the fourth-largest contributor to McConnell over the course of his career, according to The New York Times.

There isn’t enough support in the Senate to override the inevitable veto of any legislation that undermines the power plant rules. That’s why McConnell is appealing directly to the states. A dozen have already sued to stop the regulations, and it’s these legal challenges that have the most potential to cripple, or at least slow down, the plan’s implementation. The coal industry and nineteen states are also using lawsuits to try to wriggle out of new limits on mercury, arsenic and other toxic emissions; the Supreme Court heard arguments against that rule on Wednesday.

All of this suggests that Big Coal’s star is as bright as ever in Washington. The persistence of its political influence looks increasingly odd, however, when held against the fact that coal industry is imploding. The global market research firm Macquarie Research warned investors on Monday that the future for US coal companies is “increasingly bleak,” and the sector is likely to see “a wave of bankruptcies.” A report released Tuesday by the London-based Carbon Tracker Initiative found that more than two dozen coal companies have recently gone bankrupt. Between 2005 and 2010 coal lost more than 10 percent of its market share in US power generation. Meanwhile, China continues its efforts to kick its own coal habit: This week officials announced that they will shut the last coal-fired power plant in Beijing in 2016. “This is an industry in crisis,” writes Ross McCracken of Platts Energy Economist. “Now it faces a slow King Canute style defeat.”

Why are coal companies having such a hard time? One reason is that it’s becoming too expensiveto mine coal for profit in some areas, now that the easy-to-reach reserves in Appalachia (if you consider blowing the top off a mountain easy) are tapped out. The costs of shipping coal are going up, while renewable energy is increasingly affordable. The Carbon Tracker report does point to EPA regulations, particularly on Mercury, as one of the significant challenges to the industry. But even more important is the 80 percent drop since 2008 in the price of natural gas. Coal just can’t compete anymore. “What is also striking is that these factors were not driven explicitly by carbon or climate considerations,” the report continues. “Without a global climate deal or a federal carbon price, US coal is already down for the count.”

Meanwhile the economy is growing (if horrifically unequally), indicating that coal isn’t nearly as relevant as the debate about the power plant rules would suggest. Giants like Peabody still have enough money to net powerful lackeys like Tribe. But at most McConnell’s campaign would amount to corporate life support, perhaps enough to keep Peabody alive. It’s certainly no plan to lift up the struggling coal regions he claims to be fighting for. McConnell isn’t fighting the “war on coal” just for Peabody’s sake, however. As a narrative through which to filter broader resistance to any challenge to corporate power made in the public interest, that “war” is far too useful to give up.

 

By: Zoe Carpenter, The Nation, March 25, 2015

March 30, 2015 Posted by | Coal Industry, Environmental Protection Agency, Mitch Mc Connell | , , , , , , , | Leave a comment

“An Effort To Mislead The Political Process”: McConnell Is Now Going Outside Of The Senate To Obstruct Obama

Senate Majority Leader Mitch McConnell knows he has few options to derail the Environmental Protection Agency’s proposal to cap carbon pollution from coal-fired power plants. Even if he somehow got legislation past a Democratic filibuster, he would still face a veto from President Barack Obama. Courts could eventually overturn the new regulations, but he will have no say in their decisions. So McConnell is trying to thwart the rules by operating outside the Senate, where any anti-EPA bill would face a dead-end on Obama’s desk.

Earlier in March, McConnell encouraged states to opt out of the EPA’s Clean Power Plan with an op-ed in the Lexington Herald-Leader. On Thursday, McConnell took it a step further by sending a letter to all 50 governors asking them not to submit state implementation plans for curtailing power-plant pollution. By not submitting plans, McConnell thinks states will buy enough time for the coal companies to overturn the EPA in the courts. “They really can’t defeat this through federal legislation, and McConnell is trying to get the governors to do it for him,” Natural Resources Defense Council’s Climate and Clean Air Program Director David Doniger said.

According to The New York Times, McConnell is arguing that the rule is unconstitutional and leaning heavily on Harvard University constitutional scholar Laurence Tribe’s opinion that the EPA overstepped its authority. Tribe has argued against the rules on behalf of Peabody Energy and has become an ally to Republicans in their fight against the EPA. But Harvard legal experts Jody Freeman and Richard Lazarus picked apart Tribe’s legal arguments this week. “The President’ s proposed climate plan neither unconstitutionally ignores statutory language nor unconstitutionally takes anyone’s property,” they write. “Nor is State sovereignty unconstitutionally threatened by the proposed rule.”

New York University Institute for Policy Integrity Director Richard L. Revesz sees McConnell’s strategy as “an effort to mislead the political process,” because EPA opponents know their constitutional argument is weak. “The strategy therefore makes sense,” he said. “They can’t wait for a court to decide it, because Tribe’s constitutional arguments aren’t going to work. These are just legal arguments designed to mislead the political process.”

MConnell’s plan has many faults, including its most obvious problem: States can’t stop federal regulations by choosing to ignore them. If they do, the federal government steps in with its own plan. Notably, no governor has yet come out against submitting a state plan to the EPA. McConnell’s approach entirely hinges on the assumption that the EPA regulations will be thrown out in courts, which he can’t promise. Even Tribe said McConnell’s approach won’t work, because states “can’t count on” his being right that it will be overturned in courts.

 

By: Rebecca Leber, The New Republic, March 20, 2015

March 22, 2015 Posted by | Environmental Protection Agency, GOP Obstructionism, Mitch Mc Connell | , , , , , , , | Leave a comment

   

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