Republican Opposition To Regulation

Via Mark Thoma, Brad Plumer:

Over the next 18 months, the Environmental Protection Agency will finalize a flurry of new rules to curb pollution from coal-fired power plants. Mercury, smog, ozone, greenhouse gases, water intake, coal ash—it’s all getting regulated. And, not surprisingly, some lawmakers are grumbling.

Industry groups such the Edison Electric Institute, which represents investor-owned utilities, and the American Legislative Exchange Council have dubbed the coming rules “EPA’s Regulatory Train Wreck.” The regulations, they say, will cost utilities up to $129 billion and force them to retire one-fifth of coal capacity. …

So, who’s right? This month, the nonpartisan Congressional Research Service, which conducts policy research for members of Congress, has been circulating a paper that tries to calmly sort through the shouting match. … And the upshot is that CRS is awfully skeptical of the “train wreck” predictions. …

the report says, industry groups have almost certainly overstated the costs. …

In one example, the EPA estimates that an air-transport rule to clamp down on smog-causing sulfur dioxide and nitrogen dioxide would help prevent 21,000 cases of bronchitis and 23,000 heart attacks, and save 36,000 lives. That’s $290 billion in health benefits, compared with $2.8 billion per year in costs by 2014. “In most cases,” CRS notes, “the benefits are larger.”

From Thoma:

I think it’s hard to deny that there is market failure in the electricity generation industry. The externalities are pretty clear. If this was about making markets work, then the debate ought to be about how best to force firms to internalize all of the costs of production (and if some firms are unprofitable when they are forced to pay all costs, then that’s the market speaking and Republicans ought to listen). …

But that’s not how the debate is carried out. It seems to be more of a knee-jerk reflexive defense whenever supporter’s interests are threatened in any way. Politicians in particular hide behind a call for free markets without ever explaining how letting markets be free to fail, and fail badly, is the best choice for society (not in every case, of course, there are certainly those who are ideologically consistent).

ALEC’s dire warning about the end of coal production in America brings to mind this classic TNR post, “Women’s Suffrage and Other Visions of Right-Wing Apocalypse.” It’s strange to imagine that same-sex marriage could destroy America, when we know from past conservative pronouncements that child labor restrictions, auto emissions regulations, and Medicare destroyed it long ago.

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  • Anonymous

    I haven’t looked into the additional costs of these proposed rules, but coal is still the cheapest form of electricity we have — literally. So, these regs would have to cost a ton of dough to offset that advantage.

    • dedc79

      here’s the part where I get in over my head on economics, but coal may be cheapest to extract/market, but it has externalities that make it more costly and that aren’t always factored into a comparison between coal/natural gas/nuclear/solar/wind/hydro.

      • Anonymous

        True. Mountaintop mining and carbon, mercury, SOx and NOx emissions are clear examples. The only problem is that natural gas, nuclear, and geothermal are the only other baseload generating alternatives (wind and solar are only good for peaking power plants). Nuclear, of course, is impossible to build because of waste storage and NIMBYism. Natural gas is becoming much cheaper, but it also has its own host of issues with fracking. Geothermal is great, but you can only build plants in certain parts of the country. Hydro has basically already been fully exploited. The bottom line is that there are no perfect replacements for coal, even with its negative externalities.

        • reflectionephemeral

          Huh, I was going to do a post about how we should really, really be considering more nuclear power, but it turns out I already did: Oh well.

          (In fact, the promise of new nuclear plants was one of the small handful of things that I thought were silver linings of Bush rather than Gore being declared the winner of the ’00 elections. I also thought we’d be more careful to build institutions (rather than ad hoc reactions) to meet threats & preserve stability, and that we’d restructure the military so as not to tap the Guard and Reserves so badly. Whoops!)

          • Anonymous

            I’m a big fan of nuclear power too. Once you build a plant, it is very cheap to operate and there are zero carbon emissions. Unfortunately, I fear the Japanese earthquake put the nail in nuclear’s coffin. Sigh…