Discovery Institute fellow: EPA war on coal is unconstitutional

Original Article

Just when you expect President Obama to moderate his domestic economic policies that have stifled job growth and fostered an anemic recovery following the passage of his two signature pieces of legislation — the Dodd-Frank Wall Street Reform and Consumer Protection Act and the Affordable Care Act — it gets worse. Now, after bringing banking and healthcare — about 31 percent of the U.S. economy — under the heel of government, Obama wants to further control and transform the energy sector, which represents another 10.5 percent of the economy.

Blocking the Keystone XL pipeline, which could help bust OPEC by transporting abundant Canadian oil into the United States, was the opening salvo of Obama’s war against fossil fuels. The march now is to destroy the coal industry, which employs nearly 800,000 people and remains the country’s leading fuel source for electricity generation — providing nearly 40 percent of America’s electric power.

So how can this be a priority at the very time when the fragile and faltering economy just reported the first negative quarterly GDP growth in three years?

For Barack Obama it has never really been about people or the economy. Judging by actions rather than rhetoric, he has always been more committed to the left-wing politics of socialist transformation than to improving the day-to-day lives of average Americans. His early bailouts favored special interests, allies in the unions, and supporters among politically connected such as the largest alternative energy manufacturer General Electric and countless smaller ones — many of which, like Solyndra, failed and destroyed billions in taxpayer resources. Later, Obama’s health care legislation cut deals with insurance companies and big pharma while raising costs to most consumers.

The fact is that in 2010, when both houses of Congress were under Democratic Party control, Obama’s anticarbon policy proposals were debated and rejected. Now the president is going around Congress and the Constitution. By executive fiat, Obama is reinterpreting the Clean Air Act and directing the Environmental Protection Agency to implement what Congress spurned: the imposition of cap and trade regulations on the entire electric power generating industry.

The new EPA rules, that require a 30 percent reduction in carbon emissions, impose what is effectively an unattainable standard on state-based power grids, which will result in millions of Americans having higher electric bills and more exposure to rolling blackouts. Like Obamacare, the result will be increased costs for lower quality and less choice.

According to industry experts, the new EPA mandates will mean less reliability of the nation’s electric grid, which will discourage American manufactures from expanding production and creating domestic jobs. Thus, Obama’s transformation of the U.S. energy sector will increase uncertainty and have job-killing consequences similar to what was created by Obamacare.

In general, the Obama EPA’s proposed regulations put America’s low- and middle-income families most at risk of paying disproportionately more for energy. And these families have seen their income dwindle by 22 percent over the last decade while their energy bills have increased by 27 percent. If this initiative stands, West Virginia — one of the poorest of the 50 states that derives 96 percent of its power from coal — will be further impoverished and in need a federal bailout.

So what is to be done? The Republican-controlled House should take immediate legal action, starting with an injunction and a restriction of funding for the EPA. There are numerous legal arguments to pursue in the ensuing litigation, starting with the unconstitutionality of President Obama’s incorrect and inappropriate application of the Clean Air Act, which was directed at regulating pollutants, not carbon emissions.

President Obama’s use of the EPA to make good on his 2008 energy platform campaign promise in which, “energy prices will necessarily skyrocket” can and should be stopped.

When Shakespeare said, “Pride cometh before a fall,” he was referring more to hubris than incompetence. But with the Obama administration, the latter turns out to be the political gift that keeps on giving.

Scott S. Powell

Senior Fellow, Center on Wealth and Poverty
Scott Powell has enjoyed a career split between theory and practice with over 25 years of experience as an entrepreneur and rainmaker in several industries. He joins the Discovery Institute after having been a fellow at Stanford’s Hoover Institution for six years and serving as a managing partner at a consulting firm, RemingtonRand. His research and writing has resulted in over 250 published articles on economics, business and regulation. Scott Powell graduated from the University of Chicago with honors (B.A. and M.A.) and received his Ph.D. in political and economic theory from Boston University in 1987, writing his dissertation on the determinants of entrepreneurial activity and economic growth.