Last quarter, the GDP of the United States grew at a rate of 0.1%, the lowest rate we could have before being in a recession. So today, we learn that president Obama is about to take steps to slow growth even further. The news report in question says that Obama will henceforth require all environmental impact statements prepared by federal agencies to consider full life global warming impacts for each project under consideration. This may not sound like much, but it will have enormous impacts on the economy, and all will be negative.
For the last forty or so years, projects to be approved by the feds have required to have an environmental impact statement. The applicant has to show and the agency has to consider whether or not a project will adversely affect the cleanliness of the air and water as the project progresses. What this has always meant is that if someone desires to build a dock on a navigable river, that person must explain how construction of the dock will affect pollution of that river. The Corps of Engineers will then decide whether or not the project should be authorized. These environmental impact statements cause major delays to projects and are often used by opponents to stop construction. They add substantial costs to the approval process.
Adding a lifetime global warming impact requirement to the environmental impact rules will change two things: (1) the time considered will be the entire life of the project rather than just its construction, and (2) the impact on global warming will now become a factor in approvals. By extending the review to the full life of a proposed project, the amount of information that will need to be supplied will be increased dramatically. This will further increase the cost for the approval and will delay the ability of the projects to start. Adding global warming to the considerations will mean that there will be a whole new issue that will need to be fully covered. It will provide a fertile source for lawsuits designed to delay or stop projects. The net effect of the change will be to drive up the cost and risk of every possible project built in the USA that requires federal approval, a change which will reduce investments across the board.
Let's consider an example, namely, the Keystone Pipeline. Right now, the Keystone Pipeline has been under "study" for the last five years. All of the water and air pollution issues have been resolved, and it seems likely that president Obama will soon issue an approval (ignoring this latest change in the rules.) If the lifetime global warming issue gets added to the review now, however, it will be many years before the project could proceed. First, those who seek approval would need to amass all sorts of data to cover the projected effect of the pipeline for its entire lifetime. No longer would the effect be the one felt in the USA; the global effect would have to be considered. Further, items like the carbon emissions that come from vehicles that burn gasoline refined from the oil transported by the pipeline would need to be added into the mix. Simply put, the rule change would likely kill the pipeline.
But it is not only controversial projects like Keystone that would be affected. Suppose there were a proposal to build a port facility to export natural gas overseas. The gas would replace oil or coal in Europe or Latin America and would result in clearner air, less pollution and even less carbon emissions. Nevertheless, before the port could be built, the feds would require detailed reports on whether or not the gas burned would produce any carbon at all. In the years of review that would follow, there would likely be lawsuit after lawsuit trying to stop construction. The new regulations would be an open invitation to delay and litigation designed to dissuade construction of the project.
The net result of this change will not be any reduction in the carbon emissions around the world. No, the result will just be the slowing of growth in the USA. With this one move, Obama could single handedly slow or even stop the oil and gas boom that is hitting the USA. Since the energy industry is basically the only area of the economy (along with federal government spending) that is growing consistently at a robust pace, Obama would be driving a knife into the heart of the American economy.
For the last forty or so years, projects to be approved by the feds have required to have an environmental impact statement. The applicant has to show and the agency has to consider whether or not a project will adversely affect the cleanliness of the air and water as the project progresses. What this has always meant is that if someone desires to build a dock on a navigable river, that person must explain how construction of the dock will affect pollution of that river. The Corps of Engineers will then decide whether or not the project should be authorized. These environmental impact statements cause major delays to projects and are often used by opponents to stop construction. They add substantial costs to the approval process.
Adding a lifetime global warming impact requirement to the environmental impact rules will change two things: (1) the time considered will be the entire life of the project rather than just its construction, and (2) the impact on global warming will now become a factor in approvals. By extending the review to the full life of a proposed project, the amount of information that will need to be supplied will be increased dramatically. This will further increase the cost for the approval and will delay the ability of the projects to start. Adding global warming to the considerations will mean that there will be a whole new issue that will need to be fully covered. It will provide a fertile source for lawsuits designed to delay or stop projects. The net effect of the change will be to drive up the cost and risk of every possible project built in the USA that requires federal approval, a change which will reduce investments across the board.
Let's consider an example, namely, the Keystone Pipeline. Right now, the Keystone Pipeline has been under "study" for the last five years. All of the water and air pollution issues have been resolved, and it seems likely that president Obama will soon issue an approval (ignoring this latest change in the rules.) If the lifetime global warming issue gets added to the review now, however, it will be many years before the project could proceed. First, those who seek approval would need to amass all sorts of data to cover the projected effect of the pipeline for its entire lifetime. No longer would the effect be the one felt in the USA; the global effect would have to be considered. Further, items like the carbon emissions that come from vehicles that burn gasoline refined from the oil transported by the pipeline would need to be added into the mix. Simply put, the rule change would likely kill the pipeline.
But it is not only controversial projects like Keystone that would be affected. Suppose there were a proposal to build a port facility to export natural gas overseas. The gas would replace oil or coal in Europe or Latin America and would result in clearner air, less pollution and even less carbon emissions. Nevertheless, before the port could be built, the feds would require detailed reports on whether or not the gas burned would produce any carbon at all. In the years of review that would follow, there would likely be lawsuit after lawsuit trying to stop construction. The new regulations would be an open invitation to delay and litigation designed to dissuade construction of the project.
The net result of this change will not be any reduction in the carbon emissions around the world. No, the result will just be the slowing of growth in the USA. With this one move, Obama could single handedly slow or even stop the oil and gas boom that is hitting the USA. Since the energy industry is basically the only area of the economy (along with federal government spending) that is growing consistently at a robust pace, Obama would be driving a knife into the heart of the American economy.
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