Advice in an Obama administration interagency review memo to the Environmental Protection Agency warns that government regulation of greenhouse gases under the Clean Air Act (CAA) will hurt the economy, and questions whether such a "precautionary" move would too expansively open up the door for government regulation.
"Making the decision to regulate CO2 under the CAA for the first time is likely to have serious economic consequences for regulated entities throughout the U.S. economy, including small businesses and small communities," says one comment in the memo , which was officially sent by the White House's Office of Management and Budget. "Should EPA later extend this finding to stationary sources, small businesses and institutions would be subject to costly regulatory programs such as New Source Review."
The Supreme Court, ruling in the 2007 case Massachusetts v. E.P.A., ordered the EPA to determine whether greenhouse gases endangers public health and welfare.
The Bush administration essentially ignored the ruling.
On April 17, Obama's EPA Administrator, Lisa Jackson, issued a proposed "endangerment finding," which would likely mean the EPA would regulate greenhouse gases -- carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride, treated as a group as an air pollutant -- through the Clean Air Act.
The White House has not yet decided to go forward with the finding. There is a 60-day comment period following the finding. As part of this process, the Obama administration requested comment from various departments and agencies on the endangerment finding, which is where the memo came from.
A White House spokesman said the president's preference would be to have greenhouse gas regulation be accomplished through legislation rather than through executive fiat.
"While EPA had an obligation to follow the law and engage in this scientific process in the wake of the Supreme Court ruling, the President has called on Congress to pass comprehensive energy legislation that includes a market based cap on carbon emissions that would transition the nation to a clean energy economy and create millions of green jobs," White House spokesman Ben LaBolt said.
Legislation to regulate greenhouse gases is being written by Rep. Henry Waxman, D-Calif., chairman of the House Energy and Commerce Committee, and Rep. Ed Markey, D-Mass. Waxman will outline details of this bill during a closed-door meeting with Democrats on his committee later today.
That nine-page memo voices "a concern that EPA is making a finding based on (1) 'harm' from substances that have no demonstrated direct health effects, such as respiratory or toxic effects, (2) available scientific data that purports to conclusively establish the nature and extent of the adverse public health and welfare impacts are almost exclusively from non-EPA sources, and (3) applying a dramatically expanded precautionary principle."
If the EPA goes forward with a finding of endangerment for all six greenhouse gases, the document warns, "it could be establishing a relaxed and expansive new standard for endangerment. Subsequently, EPA would be petitioned to find endangerment and regulate many other 'pollutants' for the sake of the precautionary principle (e.g., electromagnetic fields, perchlorates, endocrine disruptors, and noise)."
The memo suggests that such a "finding could be strengthened by including additional information on benefits, costs, and risks (where this information exists); meeting appropriate standards for peer review; and accepted research protocols… The Finding should also acknowledge that EPA has not undertaken a systematic risk analysis or cost-benefit analysis."
The memo will no doubt be seized upon by business lobbyists who oppose Jackson's move, who last month wrote to her warning that an "endangerment finding will set the stage for an economic train wreck and a constitutional crisis." The endangerment finding "will trigger a regulatory cascade threatening the economy," they wrote. "Rather than decry this peril to the economy and the polity, some Obama Administration officials and Members of Congress—and many activists—brandish the endangerment finding as a tool of legislative extortion. Their increasingly audible threat: 'Enact the Waxman-Markey bill, or we’ll unleash the CAA on the economy.'"