EPA Global Warming Regulations Could Send Economy Back Into Recession, Report Says

By Matt Cover | March 21, 2011 | 4:01 AM EDT

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(CNSNews.com) – Regulation of greenhouse gasses by the Environmental Protection Agency (EPA) could reverse the very modest economic recovery and even send it back into a recession, a report from the National Center for Public Policy Research finds.

“These regulations,” author Dana Joel Gattuso wrote, “will have a more severe impact on energy costs, U.S. jobs, household income, and economic growth than cap-and-trade legislation would have had. Furthermore, the regulations could reverse the economy's direction toward recovery and push us back into an economic slump.”

EPA has considered regulating the emission of carbon dioxide and other greenhouse gasses under the Clean Air Act, which the Supreme Court gave the agency the power to regulate greenhouse gasses in the name of fighting air pollution.

EPA has not yet enacted the types of greenhouse gas regulations Gattuso’s paper warns of, but the agency has announced that it plans to do so in the near future.

“EPA will propose standards for power plants in July 2011 and for refineries in December 2011 and will issue final standards in May 2012 and November 2012, respectively,” EPA said in a December 2010 press release.

Gattuso also reported that GHG regulations would cost the economy jobs, worsening an already bad employment situation. Particularly hard hit would be African-Americans, who would bear a disproportionate share of the job losses caused by the EPA’s anti-global warming regulations.

“The U.S. economy will also stand to lose millions of jobs as energy prices soar and industry is forced to cut back or invest overseas,” the report said.

“Furthermore, the rules will have an unjust and disproportionately large impact on minorities, increasing the number of African Americans in poverty by 20 percent,” it added.

The report also analyzes Republican and Democratic legislation that would attempt to stop the EPA from issuing GHG regulations during a period of economic hardship and a fragile recovery.

The first bill Gattuso reviews is the joint effort from Sen. James Inhofe (R-Okla.) and Rep. Fred Upton (R-Mich.) that would bar the EPA from using its newfound authority under the Clean Air Act to regulate GHGs.

“Many members of Congress — Democrats as well as Republicans — are supporting legislation to prevent Obama from expanding the Clean Air Act and imposing more economic costs on Americans,” Gattuso reported.

“Among the Democrat co-sponsors of the legislation are Representatives Dan Boren (D-OK), Collin Peterson (D-MN), Nick Rahall (D-WV) and Senator Joe Manchin (D-WV).”

The Inhofe-Upton bill would completely prevent the EPA from ever using its Clean Air Act authority to regulate greenhouse gasses. Manchin said such an approach was necessary because Congress declined to pass a separate regulatory scheme for greenhouse gasses in 2010.

“It's time that the EPA realizes it cannot regulate what has not been legislated. Our government was designed so that elected representatives are in charge of making important decisions, not bureaucrats,” Manchin said in a statement March 4.

“The simple fact is that the EPA is trying to seize more power than it should have, and must be stopped,” he added.

Gattuso also examined competing legislation offered by Sen. Jay Rockefeller (D-W.Va.) that would delay EPA’s power to regulate by two years, calling it an exercise in kicking the can down the road.

“The problem with this ‘kick the can down the road’ approach is that it impedes job creation and economic growth by furthering regulatory uncertainty. Also, it does nothing to stop the EPA from imposing regulations without voter approval. Americans emphatically said no to cap-and-trade legislation,” Gattuso said.

“Telling the EPA to wait two years before it overrides the will of voters is not acceptable and would invite EPA over-reach and encroachment on congressional authority in the future,” he added.

Gattuso concluded that the Inhofe-Upton effort was the only legislation that would successfully prevent the EPA from enacting economically damaging regulations.

“The Energy Tax Prevention Act would rein in the EPA, put Congress back in control, and steer our economy toward a complete and healthy recovery — not for two years but permanently.”