NCPA - National Center for Policy Analysis


December 4, 2008

Legislation designed to address global warming failed in Congress this year, largely due to concerns about its high costs and adverse impact on an already weakening economy.  The congressional debate will likely resume in 2009, as legislators try again to balance the environmental and economic considerations on this complex issue.  Meanwhile, the Environmental Protection Agency (EPA), pursuant to a 2007 Supreme Court decision, has initiated steps toward bypassing the legislative process and regulating greenhouse gas emissions under the Clean Air Act, says Ben Lieberman, a senior policy analyst with the Heritage Foundation.

The Environmental Protection Agency's (EPA) Advance Notice of Proposed Rulemaking (ANPR) is nothing less than the most costly, complicated, and unworkable regulatory scheme ever proposed, says Lieberman:

  • Under ANPR, nearly every product, business, and building that uses fossil fuels could face requirements that border on the impossible.
  • The overall cost of this agenda would likely reach well into the trillions of dollars while destroying millions of jobs in the manufacturing sector.

The ANPR is clearly not in the best interests of Americans, and the EPA should not proceed to a Notice of Proposed Rulemaking and final rule based upon it, explains Lieberman.  Furthermore, the impact of ANPR on the overall economy, as measured by gross domestic product (GDP), would be substantial:

  • The cumulative GDP losses for 2010 to 2029 approach $7 trillion.
  • Single-year losses exceed $600 billion in 2029, more than $5,000 per house­hold.
  • Job losses are expected to exceed 800,000 in some years, and exceed at least 500,000 from 2015 through 2026 (note that these are net job losses, after any jobs created by compliance with the regulations--so-called green jobs--are taken into account.)
  • Hardest-hit are man­ufacturing jobs, with losses approaching 3 million.
  • Particularly vulnerable are jobs in durable manufacturing (28 percent job losses), machinery manufacturing (57 percent), textiles (27.6 percent), electrical equipment and appli­ances (22 percent), paper (36 percent), and plastics and rubber products (54 percent).


  • Since the EPA rule is unilateral and few other nations are likely to follow the U.S. lead, many of these manufacturing jobs will be out­sourced overseas.
  • The job losses or shifts to lower paying jobs are substantial, leading to declines in disposable income of $145 billion by 2015 -- more than $1,000 per household.

Source: Ben Lieberman, "The True Costs of EPA Global Warming Regulation," Heritage Foundation, Backgrounder No. 2213, November 24, 2008.


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