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EPA: Regulatory Mess, Economic Massacre

The Environmental Protection Agency announced on December 7, 2009, that greenhouse gases, including carbon dioxide emissions, contribute to air pollution that may reasonably be anticipated to “pose a threat to our health and welfare.” If this finding is allowed to become law, the Obama Administration will succeed in gaining greater control over everyday life in America, at a time when small businesses are already struggling.

After the endangerment finding was announced, an unnamed White House official prophesied that if Congress failed to pass climate change legislation “the EPA is going to have to regulate in this area.” The source went on to say, “[The EPA] is not going to be able to regulate on a market-based way, so it’s going to have to regulate in a command-and-control way.”

The pattern is becoming clear. The Obama Administration – unsatisfied with the process of representative democracy – disregards the Constitution and forces upon the American people an agenda that Congress would not pass and the majority of Americans do not want.

So how did we get here?


In 1999, Massachusetts and several other states began a campaign to force the EPA to regulate carbon emissions from motor vehicles, claiming that these gases contribute to man-made global warming. The Supreme Court, legislating from the bench, ruled in 2007, “The [EPA] Administrator must determine whether or not emissions of greenhouse gases…cause or contribute to air pollution.”

Under the 1970 Clean Air Act (CAA), any source that emits an “air pollutant” above 250 tons per year will trigger additional taxes and onerous permit requirements levied directly on businesses – costs that are ultimately passed along to consumers. To fly this terribly expensive energy tax under the radar, the EPA contrived a clever “tailoring rule,” arbitrarily amending the CAA without Congressional authority by raising the CO2 emissions threshold from 250 to 250,000 tons per year so that only the largest polluters are regulated.

But according to the U.S. Chamber of Commerce, this threshold would be reached by “one-fifth of all food services, one-third of those in health care, half of those in the lodging industry, [and] 10 percent of buildings used for religious worship” in America. Even the EPA’s own estimates project that small entities will incur more than $55 billion in costs under the endangerment finding absent the tailoring rule.

This small polluter exemption, however, rests on questionable legal footing, causing the usually EPA-friendly Center for Biological Diversity to object that “the EPA has no authority to weaken the requirements of the statute simply because its political appointees don’t like the law’s requirements.”

What can Americans expect if the EPA gets away with this?

The EPA’s first step will be to regulate the auto industry. Once they have established control over automobile emissions standards, the EPA will be emboldened to continue controlling any carbon emitting source, imposing draconian measures on hospitals, schools, churches, farms, restaurants and malls. In fact, a recent study by the EPA found that more than 6 million businesses would be financially burdened by a full enforcement of the endangerment finding.

Additionally, a recent analysis by the Heritage Foundation estimates that EPA’s actions could result in a cumulative loss of nearly $7 trillion in GDP by 2029 (in inflation-adjusted 2008 dollars) and annual job losses could surpass 800,000 for several years.

Simply put, under the Obama Administration, the EPA is a wrecking ball that is destroying jobs, putting more businesses under water and increasing government control over our everyday lives.

With the U.S. already in a soft economy, many cash-strapped communities will face a tough choice – jump through another expensive regulatory hoop or cancel much needed community development projects. Compound this situation over many times around the nation and you have a crisis of economic gridlock.

While the EPA is expanding its regulatory jurisdiction, Congress has the sole right and responsibility to enact legislation nullifying any rogue determination they make – and we should do just that.

Bipartisan support is growing for legislation that will force the EPA to abandon this aggressive pursuit of more regulatory control and unbridled authority over our daily lives. Unless Congress acts fast, Americans will be forced to pay for the most expensive regulatory scheme in a generation.

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