National Automobile Dealer’s Association

No, It’s Not About Oil; Besides, Oil Is Good!

by Marlo Lewis on June 10, 2010 · 7 comments

in Global Warming

It is a measure of the weakness of the case against Sen. Murkowski’s resolution of disapproval (S.J.Res.26) that opponents keep trying to change the subject.

They want to pretend that a vote for S.J.Res.26 is a vote for Big Oil in general and for BP’s oil spill and all the associated ecological and economic damage in particular.

To say it again, if they really think oil is so bad that America should pay any price, bear any burden, and endure any sacrifice to get “beyond petroleum,” then they should follow the Constitution and try to assemble legislative majorities capable of enacting their agenda.

They know they can’t, so they want EPA — an administrative agency — to enact their agenda for them. That this makes a mockery out of our constitutional system of separated powers and democratic accountability doesn’t seem to bother them one whit.

The vote on S.J.Res. 26 is not “about oil.” The endangerment rule, which the Murkowski resolution would overturn, would not create a single tool or authority that could have averted the BP oil spill. It would not tighten a single petroleum industry safety standard or improve a single emergency response program. It would not create a single incentive that might have made BP more diligent in implementing safety standards.

The only way greenhouse gas regulations could stop oil spills is by making deep water drilling unprofitable. That, however, would make America more dependent on IMPORTED oil (duh!). Is that want opponents of S.J.Res.26 want?

They’ll say, no, their goal is to ”set America free” from dependence on petroleum as such. But that is not possible at reasonable cost, which is why despite decades of anti-petroleum agitation, fuel economy standards, and government support for alternative technologies and fuels, U.S. petroleum consumption and imports continue to increase.

At most, EPA’s greenhouse gas emission standards can only decrease the rate at which U.S. petroleum consumption increases. More accurately, EPA’s standards would only complicate and reduce the efficiency of the fuel economy program Congress created and amended via the 1975 Energy Policy and Conservation Act and 2007 Energy Independence and Security Act. As the National Automobile Dealers Association explains in a letter in support of S.J.Res.26, overturning the endangerment rule would help restore a more efficient approach: “a single national fuel economy standard, with rules set by Congress.”

Finally, the notion that oil is bad and hence that government can’t do too much to restrict petroleum production is benighted. Members of Congress who espouse this view either deliberately mislead the public or are ignorant of oil’s historic and continuing massive contribution to the improvement of human health and welfare.

A recent post on a blog called The Intellectual Activist eloquently explains the common sense of the matter. I reproduce it below.

TIA Daily • June 4, 2010
FEATURE ARTICLE
Oil Is Good
by Jack Wakeland
I appreciated the pro-industrialism in last Friday’s edition of TIA Daily:

I also think that we need to return to a more old-fashioned attitude toward industrial accidents. Today, they are considered utterly unacceptable catastrophes for one reason: a large segment of the culture does not accept that it is legitimate for heavy industry to exist at all and has a particular animus toward industries that generate power—including oil and coal. So they exploit every accident to promote their pre-existing agenda of shutting down all oil exploration. But if we accept that the Industrial Revolution is a good thing—that it has roughly doubled the average lifespan and vastly increased our quality of life—then we accept that the oil industry has to exist and that occasional accidents are just part of the cost of living.

With continuous 24-hour headline news coverage of this supposedly “unprecedented” disaster—in fact, it was preceded by the 10-month-long, 140 million-gallon Ixtoc 1 blowout off the gulf coast of Mexico in 1979—Rob Tracinski and Sarah Palin are among a tiny minority of American commentators who have voiced the opinion that industrial development is essential for civilization. Unfortunately Sarah Palin and almost all conservatives agree 100% with conservationism—the pre-New-Left version of environmentalism. They say that energy development as a “dirty” business—a necessary evil—that produces “dirty” messes. But we must endure the ugly mess if we are to enjoy the benefits of living a civilized existence.

Of all of the hundreds of commentaries written about the BP oil spill, I can’t recall one single editorial that endorses oil drilling as good.

It is good for oil company stock holders. Good for industrial producers. Good for automobile and truck drivers. Good for people who travel by ship, railroad, or aircraft. Good for people who don’t want to be limited to living out their whole lives without ever traveling farther than 100 miles from the village in which they were born.

Oil is good for people who buy products that are shipped to them from out of town. Good for producers who buy parts and supplies that are shipped in from out of town. Good for the specialization of industrial production that is made possible by mass shipment of parts and materials. Good for the geometrical growth of world-wide industrial productivity made possible by the specialization of production and trade.

Oil is good for farmers who use machines to plant and reap and store and dry and ship and process all of the food we eat. Good for farmers who use fertilizer and other agri-chemicals made from oil to boost the productivity of the land. Good for anyone who doesn’t enjoy enduring bouts of malnutrition and starvation—and the occasional famine.

Oil is good for people who don’t want to endure freezing indoor temperatures in the winter. Good for all producers and end users of lubricants, paints, plastics and other petro-chemical-based products. (Half of the volume of a barrel of crude oil ends up going to make fertilizers and plastics.)

Oil is good for powering all of the ships, trucks, aircraft, helicopters, communications equipment and base electrical systems, and all of the fighting vehicles that the US military use for our national defense. (Ask yourself why it was that when the US Army Air Force decided to destroy the entire nation of Germany in 1944—why was it that they bombed the oil refineries? Why was it that they bombed all modes of transportation to limit shipment between factories of unfinished industrial products?)

Oil drilling isn’t a “dirty” business. It isn’t a necessary evil. It is good. It is a life-giving good. It is an unqualified good.

The problems of an occasional industrial accident in which fewer than a dozen men are killed fades to nothing in comparison with the great comfort and prosperity and scope of life—including the operation of the mechanized agriculture and industrial production upon which the bare survival of the vast majority of the 6.5 billion human beings currently living on this earth depends.

What Happens If Congress Blocks EPA?

by Marlo Lewis on March 9, 2010 · 2 comments

in Global Warming

That’s the topic of this week’s National Journal energy blog. In my contribution, I argue that EPA has been playing a mischievous game that endangers democracy, and that Sen. Lisa Murkowski’s legislation to veto the agency’s endangerment finding would remove this threat. 

In a Feb. 22 letter to Sen. Jay Rockefeller (D-WV), EPA Administrator Lisa Jackson warns that enactment of the Murkowski legislation would scuttle the joint EPA/National Highway Traffic Safety Administration (NHTSA) greenhouse gas/fuel economy rulemaking, which in turn would compel the struggling auto industry to operate under a “patchwork quilt” of state-level fuel-economy regulations.

Ms. Jackson neglects to mention that the patchwork threat exists only because she, reversing Bush EPA Administrator Stephen Johnson’s decision, granted California a waiverto implement its own GHG/fuel economy program. Had Jackson reaffirmed Johnson’s denial, there would be no danger of a patchwork, hence no ostensible need for the joint EPA/NHTSA rulemaking to avert it.

As my blog post explains, EPA should not have approved the waiver in the first place. The California GHG/fuel economy program violates the Energy Policy and Conservation Act, which prohibits states from adopting laws or regulations “related to” fuel economy. Worse, the waiver creates a reverse right of preemption whereby states may nullify federal law within their borders — an affront to the Supremacy Clause. 

Specifically, the waiver would allow California, and other states opting into the California program, to nullify within their boundaries the reformed national fuel economy program that Congress enacted in the 2007 Energy Independence and Security Act (EISA). That leads straight to a patchwork of state-by-state compliance regimes inimical to a healthy auto industry.

The game EPA is playing is a classic case of bureaucratic self-dealing.

First, EPA endangers the U.S. auto industry by authorizing states to flout federal law and the Constitution. Then, EPA proposes to avert disaster via a rulemaking that just happens to put EPA in the driver’s seat in regulating fuel economy – a power Congress never delegated to EPA when it enacted and amended the Clean Air Act.

Nor is that all. The joint GHG/fuel economy regulation will compel EPA to regulate CO2 from stationary sources – another power Congress never delegated to EPA. By expanding its control over the transport sector, EPA will then have to expand its control over manufacturing, power generation, and much of the commercial and residential sectors, too, because all emit CO2.

In addition, the motor vehicle GHG rule sets the stage for EPA to “tailor,” that is amend, the Clean Air Act so that the agency can delay imposing pre-construction and operating permit requirements on small business, which would surely ignite a political backlash.

So thanks to the endangerment finding, EPA not only gets to play in NHTSA’s fuel-economy sandbox, and extend its tentacles throughout the economy, it also gets to play lawmaker, violating the separation of powers.

In light of all the new powers EPA now expects to wield, it is hardly surprising that EPA never made the strong case against Clean Air Act regulation of CO2 in Massachusetts v. EPA. Here’s what EPA should have argued:

  • EPA cannot regulate GHG emissions from new motor vehicles under Sec. 202 of the Clean Air Act without regulating CO2 under the Act as a whole. 
  • Aplying the Act as a whole to CO2 leads ineluctably to “absurd results” that contravene congressional intent.
  • Therefore, Congress could not have intended for EPA to regulate GHG emissions under Sec. 202.

Did EPA throw the fight in the 11th round? I dunno, but losing the Massachusetts case was surely sweet victory to those in the agency who long to regulate America into a ”clean energy future.” The Massachusetts decision laid the groundwork for EPA to deal itself into a position to bypass the people’s elected representatives, impose its will on the auto industry, and, in time, dictate national climate and energy policy.

What happens if Congress enacts Sen. Murkowski’s resolution, nixes the endangerment finding, and mothballs the GHG/fuel economy rule? The authority to make law and national policy returns to where the framers of the Constitution intended — the people’s elected representatives.

Debunking the Smear Campaign against the Murkowski Resolution

by Marlo Lewis on March 2, 2010 · 2 comments

in Global Warming

In recent weeks I have penned four columns debunking the smear campaign against Sen. Lisa Murkowski’s (R-AK) Congressional Review Act (CRA) resolution of disapproval to stop EPA from dealing itself into a position to make climate and energy policy for the nation — a power Congress never delegated to EPA when it enacted the Clean Air Act.

Climate Politics: When Will the Sanctimony End? (MasterResource.Org, Mar. 2) debunks the calumny that the Murkowski resolution is “polluter-crafted,” and shows that this pejorative accurately applies to the Waxman-Markey cap-and-trade bill — legislation that many Murkowski detractors such as Climate Progress and MoveOn.org enthusiastically support.

MoveOn’s Triple Whopper (Pajamas Media, Feb. 10) shows that MoveOn.org’s TV ad campaign against the Murkowski resolution piles falsehood on top of falsehood on top of falsehood. MoveOn claims the Murkowski resolution would “roll back” the Clean Air Act (it wouldn’t), making it harder for EPA to clean the air (it wouldn’t). We should all be in a panic , MoveOn suggests, because “many Americans smoke the equivalent of a pack a day just from breathing the air.” An outrageous falsehood. According to peer-reviewed scientific research, smoking just one cigarette a day delivers anywhere from 12 to 27 times the daily dose of fine particulate matter (PM2.5) that non-smokers inhale in cities with the highest PM2.5 levels.

The aforementioned piece and two others — Resolution Would Protect the Economy (National Journal, Jan. 27) and Move Afoot in the Senate to Can EPA CO2 Regs (Pajamas Media, Jan. 23) – clarify what the Murkowski resolution is and isn’t.

Contrary to Sen. Barbara Boxer (D-CA) and other critics, the resolution is not a referendum on EPA’s science. Rather, it is a referendum on the constitutional propriety of unelected bureaucrats, courts, and eco-litigation groups setting climate and energy policy for the nation. The resolution is not an attempt to veto the scientific content of EPA’s endangerment finding. Rather, it would veto the finding’s legal force and effect.

Thus, there is no valid analogy, as Sen. Boxer claims, between the Murkowski resolution and Congress vetoing the Surgeon General’s finding that cigaratte smoking causes cancer. The Surgeon General’s finding was simply that — an assessment of the scientific literature. It did not even presume to offer policy recommendations, much less trigger a host of new regulations Congress never approved, as EPA’s endangerment finding will do if allowed to stand.

The Obama Administration warns that the Murkowski resolution would thrust the distressed U.S. auto industry into regulatory limbo, because the endangerment finding is the trigger for the combined greenhouse gas/fuel economy standards rulemaking scheduled to go into effect later this month or early April.

The National Auto Dealers Association (NADA) respectfully disagrees. In this letter, released today, NADA argues the Murkowski resolution would benefit the auto industry because there would be one less redundant yet potentially conflicting standard (EPA’s) regulating fuel economy and GHG emissions from new motor vehicles.

I’ll have more to say about NADA’s analysis in a later post.

Policy Peril Segment 7: Fuel economy standards

by Marlo Lewis on August 11, 2009 · 1 comment

in Global Warming, Mobility

Today’s excerpt from CEI’s film, Policy Peril: Why Global Warming Policies Are More Dangerous Than Global Warming Itself, is on two global warming policies Congress has adopted: fuel economy standards and biofuel mandates.

Here are my previous posts in this series:

To watch today’s film excerpt, click here. To watch the entire film, click here.

The text of today’s film clip immediately follows. It includes footnotes to additional commentary and supporting information.

Narrator: If stopping new coal is the global warming movement’s top priority, a close second is jump-starting a ‘beyond petroleum’ transport system. They propose to do this by tightening new-car fuel economy standards. Why?

A car that gets more miles to the gallon emits less CO2 per mile [1]. But the federal fuel economy program, also known as CAFE, has serious downsides.

Sam Kazman (General Counsel, Competitive Enterprise Institute): Now there are lots of problems with fuel economy mandates. One thing, they raise new car prices. [2] Secondly, they restrict consumer choice. [3] But the worst thing is an effect you never hear their advocates talking about. Namely, fuel economy mandates kill people. [4]

Narrator: Here’s why. Heavier cars provide more mass to absorb collision forces, and bigger cars provide more space between the occupant and the point of impact. [5] Make a car smaller and lighter, and it will go farther on a gallon of gas.

Kazman: But you also make it less safe. According to the National Academy of Sciences, the current CAFE standard by downsizing cars, contributes to about 2,000 fatalities per year. [6]

Narrator: Legislation Congress passed in December 2007  requires a 40% increase in fuel economy by 2020. [7] In 2007, only two out 1,153 vehicle models met the new standards. [8] So expect more downsizing in the years ahead.

Another ‘beyond petroleum’ policy is to require the sale of alternative fuels. In December 2007 Congress also mandated that motor fuel producers sell 36 billion gallons of ethanol a year by 2022, with 15 billion gallons coming from corn kernals. [9] The result, we’re diverting massive quantities of grain from food to auto fuel. This contributes to the surge in global grain prices that is pushing millions of the world’s poorest people to the brink of starvation. [10]

But at least ethanol cuts down on CO2 emissions, right? Actually, no.

Dr. Dennis Avery (Hudson Institute): As we expand the cropland, then we get into the real trouble, because we release the greenhouse gas that’s stored in the soil as carbon. And with corn, we release twice as much gas as we would have released if we burned gasoline in the first place. [11]

[1] A gallon of gasoline (which weighs about 6.3 lbs.) produces 20 lbs. of CO2 when burned. If a car gets more miles to the gallon, it will emit fewer lbs. of CO2 per mile driven. The relationship between fuel economy (mpg) and lbs. CO2/mile is so strict that EPA bases its fuel economy ratings of vehicle models on tests that measure the carbon content of the emissions, principally CO2.

Unsurprisingly, virtually all CO2-reduction options for new motor vehicles are fuel-economy-increasing options. See p. 10 of the National Automobile Dealer Association’s comment on EPA’s reconsideration of California’s request for a waiver to establish greenhouse gas emission standards for new motor vehicles. 

[2] There are basically two ways to increase fuel economy–downsizing (making cars smaller and lighter) and new technology. Typically, advanced technology costs more than conventional technology. The Energy Information Administration, for example, estimates that California’s greenhouse gas/fuel economy standards, which President Obama recently adopted, will increase the average price of a new car by $1,860 in 2016. [Obama's program will also impose heavy burdens on the nearly prostrate U.S. auto industry, as economist Keith Hennessey explains.]

[3] The CAFE program all but killed the market for large station wagons, because automakers could not produce millions of these once popular “family cars” and meet the CAFE standard for their vehicle fleets.

In addition, as a general matter, because fuel economy mandates increase vehicle cost, they inevitably price some consumers out of the market for certain vehicle models, restricting their choices.

Ironically, the federal fuel economy program boost the production and sale of gas-guzzling SUVs. Consumers who might otherwise have purchased big station wagons instead bought large SUVs. Congress regulated SUV fuel economy less stringently because (1) SUVs are built on a light-truck chassis and thus are classified as trucks rather than as passenger cars, and (2) most SUVs traditionally were used for farming and business rather than commuting. Fuel economy standards helped create the boom market for low-mpg SUVs–a classic case of the law of unintended consequences.

[4] Sam debates the issue of whether CAFE kills with an analyst from Natural Resources Defense Council (NRDC) here.

[5] I am always amazed when people with scientific credentials deny the safey implications of regulatory-induced vehicle downsizing. How can they claim that size and weight don’t matter? That’s denying the laws of physics. There’s a reason why boxing matches don’t pit lightweights against heavyweights, or why marathon runners don’t play professional football.

Yes, new technology can improve the crashworthiness of small cars. But, as Sam explains elsewhere, a large car with new technology will still be safer than a small car with new technology. To the extent that CAFE constrains the production and sale of larger, heavier vehicles, it limits auto safety.

[6] Sam refers to a National Academy of Sciences/National Research Council (NRC) study, Effectiveness and Impact of Corporate Average Fuel Economy (CAFE) Standards. See pp. 25-29, especially p. 27. The NRC estimates that in 1993, a typical year, downweighting and downsizing of cars contributed to 1,300 to 2,600 auto fatalities, 13,000 to 26,000 incapacitating injuries, and 97,000 to 195,000 total injuries.  

[7] The so-called Energy Independence and Security Act (EISA). Click here to read the Congressional Research Service’s summary of the EISA provisions.

[8] Prior to investigating, I had assumed there must be at least 30-50 models on the road that met the fuel economy standards mandated by the 2007 Energy Independence and Security Act. But EPA’s fuel economy ratings for model year 2008 reveals that only two out of 1,153 models, the Toyota Prius and Honda Civic Hybrid, met or exceeded the standard (35 mpg for both city and highway driving conditions).

[9] Click here to read the Congressional Research Service’s summary of the EISA provisions.

[10] I provide references here on biofuel policy and world hunger. In May 2008, the International Food Policy Research Institute estimated that biofuel demand accounted for 30% of the increase in world cereal prices during 2007-2008. For further discussion, see Dennis Avery’s October 2008 paper for the Competitive Enterprise Institute. 

[11] Dennis’s CEI paper recaps the literature on CO2 increases from biofuel policy-induced land-use changes, including Searchinger et. al. (2008) and Fargione et al. (2008). Additional reviews of these studies are available on World Climate Report and CO2Science.Org.