Part 1 :: How This Phony CIA Agent Pulled Off a ‘Scam’ to Impose Environmental Regulations on Americans
Kevin Mooney / @KevinMooneyDC / February 10 2015
Remember the EPA bureaucrat who got caught receiving $900,000 in pay without working because he claimed he also was employed by the CIA?
According to a report from the Senate Environment and Public Works Committee, the man, former climate policy expert John Beale, “retired” when questions arose about his spotty attendance and expense records.
Only he didn’t file his retirement paperwork and continued to draw an active-duty salary for some time after. His boss at the time in the EPA’s Office of Air and Radiation, now-EPA Administrator Gina McCarthy, knew this for about seven months and did nothing to stop it.
>>> This is the first of a two-part series.
“On March 29, 2012, an OAR official raised concerns about Beale’s retirement when he informed McCarthy that Beale was still on payroll,” the report stated.
“Despite being aware of the fact that one of her subordinates was collecting a paycheck without providing any work product, this arrangement continued for seven more months before McCarthy ever contacted Beale.”
In December 2012, McCarthy met with Beale for the first time in nearly 15 months, and he informed her that he was no longer planning on retiring. Two more months passed before concerns with Beale were officially reported to the inspector general. On April 30, 2013, McCarthy had cause to fire Beale, but instead elected to allow him to voluntarily retire with full benefits.
Liz Purchia, press secretary for McCarthy, told The Daily Signal in an email: “[McCarthy] believed he was retired, and [that] was the reason he was not in the office.”
How Did He Do It?
According to the Senate report, Beale’s career at the EPA was marked by relentless dishonesty on matters large and small and a cadre of supervisors who, like McCarthy apparently in the matter of his retirement pay, enabled his self-dealing behaviors.
He claimed an injury so he could ride first-class on flights for government business, which in one case drove the ticket price from $1,000 to $14,000. He forged expense forms, claimed to be away on CIA business for 2½ years worth of work days and flew to Los Angeles and stayed in posh hotels on the EPA’s tab for family visits that had nothing to do with agency work.
Few even attempted to question Beale’s frequent absences, enormous expense reports, exorbitant salary—he retired as the agency’s highest-paid employee—and lack of accountability. He was personally popular, well-connected and believed to be among the agency’s most effective employees.
But Beale’s greatest deception has nothing to do with first-class flights and fancy hotels.
Beale, who is serving a 32-month sentence in the federal prison in Cumberland, Md., for pleading guilty to felony theft of government property, spent most of his career devising regulations under the Clean Air Act that are justified by science few have seen and no one has peer-reviewed, according to the Senate report.
“We should all question how John Beale became a senior official at the EPA and played a major role in long-lasting policy decisions while pulling off a scam I thought only Hollywood could make up,” Sen. David Vitter, R-La., told The Daily Signal.
“But this egregious case helped us successfully reveal how EPA has wasted taxpayer resources and mismanagement in a manner that is far too common.”
John Beale and the Clean Air Act
Beale’s penchant for bilking the EPA out of money eroded the trust Americans place in their government and EPA employees place in their superiors and coworkers. But it was the role he played beginning in the mid-1990s in creating and implementing regulations pursuant to Clean Air Act that continues to reverberate and linger at the expense of the American people.
Staffers with the Senate Environment and Public Works Committee set out last year to probe the relationship between “sue-and-settle” arrangements and evidence they had uncovered that pointed to the manipulation of scientific data.
What they discovered, as detailed in their report, titled “EPA’s Playbook Unveiled: A Story of Fraud, Deceit and Secret Science,” was how agency officials concealed and misled about the science that underpinned its most significant initiatives and silenced and marginalized their own internal watchdog offices, which enabled the agency to greatly overstate the benefits and underestimate the costs of its Clean Air Act rulemaking.
Under the Clean Air Act, the EPA is required to create National Ambient Air Quality Standards for particulate matter and ozone. The American Lung Association sought to jumpstart this process with a so-called “sue-and-settle” suit filed in 1995.
The idea behind “sue-and-settle” is for friendly plaintiffs to sue a government agency, work out agreeable terms—perhaps even beforehand—and emerge with a court order to implement rules or regulations that could not have been achieved through the democratic or even regulatory process.
The American Lung Association suit resulted in a consent decree that called for the EPA to propose final standards for particulate matter by Nov. 29, 1996, and issue the standards by July 19, 1997. The decree set no deadline for ozone standards because they had been reviewed in 1993 and were not up for another review until 1998.
But Beale and Robert Brenner, his best friend and erstwhile boss, made what documents called a “policy call” and seized on the urgency to produce new particulate matter standards to rush through a new ozone standard as well.
This put the agency in the position of advancing two regulatory standards simultaneously, which it had never done. And it put the agency and those charged with reviewing such regulations, including the Clean Air Scientific Advisory Committee, under impossible deadline pressure.
Why Beale Was Emboldened
The EPA admitted in court papers filed pursuant to the American Lung Association lawsuit that any period shorter than Dec. 1, 1998, for promulgation of the particulate matter standard “would require the EPA to reach conclusions on scientific and policy issues with enormous consequences for society before it has had an adequate opportunity to collect and evaluate pertinent scientific data” and that further time was needed to reach a “sound and scientifically supportable decision.”
Beale had no time for that. He needed an ally to move things along and found one in Carol Browner, the Al Gore acolyte and former staffer who served as administrator of the EPA through both terms of the Clinton administration. Beale formed a close relationship with her and met with her multiple times per week to discuss his progress on this.
The urgency, as well as his influence with the boss and an unwillingness of others at EPA to block him, gave Beale “the mechanism he needed to ignore opposition to the standards.”
Beale’s efforts to include ozone in the new regulations proved expensive for Americans.
The EPA estimated the cost at $2.5 billion, but its estimate was based on receiving the full benefits of cutting ozone but achieving only a partial attainment of the standards, which the law did not permit. The Council of Economic Advisers also measured the cost and found it to be $60 billion—24 times the EPA estimate.
Indeed, as was the case with him getting away with not showing up for work and submitting exorbitant expense reports, succeeding in this regulatory sleight of hand only emboldened Beale to go further.
‘Hidden and Unverified’
That first round of standards, which regulated coarse particulate matter, such as pollen and dust, became known as PM10. But Beale wanted more.
In 1997, with the backing of his superiors, he sought to engage the agency in regulating fine particulate matter—particles a fourth the size of those regulated under PM10 and too small to be visible to the human eye.
But to enact these regulations, EPA first had to produce scientific research that established these smaller particles posed a threat to humans.
To accomplish this, Beale pulled data from two controversial studies—the Harvard Six Cities Study and an American Cancer Society study known as ACSII. The data was not trusted. The air advisory committee pointed out it had not been peer-reviewed, and others indicated Beale was exaggerating the findings for his desired result.
Further undermining those studies’ credibility is that even now, 20 years later, EPA still refuses to release the data, despite McCarthy’s promise to do so during her confirmation hearings.
Though Beal is out of the picture and in prison, his rulemaking techniques he employed to advance the 1997 National Ambient Air Quality Standards for ozone and particulate matter remain firmly entrenched.
“This effort codified EPA’s now customary practice of using fine particulates (PM2.5) to inflate the benefits of nearly all regulations issued under the Clean Air Act,” the Senate report concludes. “Yet the science supporting nearly all of EPA’s alleged benefits remain hidden and unverified.”
Part 2 :: EPA Under Fire for Concealing Controversial Scientific Data, Silencing Skeptics
Kevin Mooney / @KevinMooneyDC / February 11, 2015
For more than 15 years, the Environmental Protection Agency has resisted releasing data from two key studies to the general public and members of Congress. Government regulators used those studies to craft some of the most expensive environmental rules in U.S. history.
When skeptics within the federal government questioned and challenged the integrity of the studies—the Harvard Six Cities Study and an American Cancer Society study known as ACS II—they were silenced and muzzled.
That’s when the Republican staff on the Senate Environment and Public Works Committee stepped in to shine light on the situation, revealing the scope of the scandal in in a report titled, “EPA’s Playbook Unveiled: A Story of Fraud, Deceit and Secret Science.”
>>> This is the second of a two-part series. Read the first part: How This Phony CIA Agent Pulled Off a ‘Scam’ to Impose Environmental Regulations on Americans
The key player in the scandal is John Beale, who was sentenced to serve 32 months in federal prison on Dec. 18, 2013, after pleading guilty to stealing almost $900,000 from U.S. taxpayers.
It was in 1994 that Beale first began to beguile EPA employees and supervisors into believing he worked for the CIA. When he failed to report for work, Beale would enter “D.O. Oversight” on his calendar, which meant he was a director of operations responsible for covert operations at the CIA.
But it was the role Beale played beginning in the mid-1990s in creating and implementing regulations pursuant to Clean Air Act that continues to reverberate and linger at the expense of the American people.
Two Allies at the EPA
Over the past decade, evidence has emerged to reveal the Six Cities and ACS II studies did not support enacting one of the most controversial, far-reaching and expensive regulations in American history. Otherwise, the agency would have provided access to the data without a fight.
The political appointees who led the EPA at the time feared the consequences of enacting such a regulation without being able to offer scientific evidence of its necessity.
Beale needed an ally. He needed someone to explain the problems with the research and the reasons the data could not be released. Someone who could run interference with various actors in Washington. He found one in top EPA official Robert Brenner.
Brenner had recruited Beale, his former Princeton University classmate, to the EPA as a full-time employee in 1989.
Brenner, then deputy director of the EPA’s Office of Policy Analysis and Review within the Office of Air and Radiation, hired his friend despite Beale’s lack of legislative or environmental policy background. He also placed Beale in the highest pay scale for general service employees—a move typically reserved for those with extensive experience.
He then allowed Beale to collect retention bonuses, which go to only the most highly qualified employees to keep them from jumping ship—an unlikely scenario for a man who had picked apples and worked in a small-time law firm in Minnesota before joining the agency. Employees are supposed to be eligible for such bonuses—potentially worth as much as a fourth of the employee’s annual salary—for only three years, but Brenner helped Beale receive them for more than 10.
The two would work together at the EPA for 25 years—during which time the Office of Policy Analysis and Review would grow “in both scope and influence” as Beale and Brenner worked in tandem to muzzle dissenting voices within the White House Office of Information and Regulatory Affairs (OIRA) and the EPA’s Clean Air Scientific Advisory Committee.
‘Beale Memo’ Details Regulatory Agenda
At the crux of their agenda—the initiative that would build their legend within the agency—was implementation of a fine particle standard regulating air pollution.
The formula had been set with the American Lung Association sue-and-settle agreement and codified in a confidential document known as the “Beale Memo,” which described how Beale pressured regulatory and clean air bodies to back off criticisms of EPA rulemaking both within the agency and in correspondence with members of Congress.
The EPA attempted to conceal this document from Sen. David Vitter’s committee investigators, but a conscientious whistleblower “turned it over surreptitiously,” the report said.
The memo outlined how Beale and Brenner would work to compress the time the Office of Information and Regulatory Affairs and the voluntary Clean Air Scientific Advisory Committee had to review regulations so they could get away with using “secret science.”
The Clean Air Scientific Advisory Committee opposed from the start the move to regulate fine particulate matter. Members claimed there was no precedent or court order to establish these regulations, that research had not distinguished between dangers posed by PM 10 particles and those a fourth that size under PM 2.5, and that the PM 2.5 target was arbitrary and tied to no known science. (PM stands for particle matter, a term “for particles found in the air, including dust, dirt, soot, smoke, and liquid droplets,” according to EPA.)
Further, the committee, known as CASAC, complained it was being asked to do the work that took eight years on the previous air quality review in 18 months.
“The Beale memo is interesting in that it provides evidence of Beale’s direct role in ensuring concerns raised by other agencies, CASAC members and OIRA were not considered in the final rulemaking,” wrote Luke Bolar, spokesman for Vitter, in an email to The Daily Signal.
“While there were major concerns with the science and the cost-benefit analysis as outlined in comments filed on the rule, the Beale memo was written to push back against OIRA publicizing those concerns,” Bolar added. “They didn’t have to directly ‘blunt’ criticism, as Beale got his way through his close ties to Mary Nichols (then head of the Office of Air and Radiation) and Carol Browner (EPA administrator.”
Efforts to slow Beale, Brenner and their highly charged regulations failed. As a result, today the “co-benefits” of PM 2.5 are used to justify almost the entirety of the Obama administration’s air quality initiatives even though the immediate benefits still have yet to be proven.
“There is no watchdog now inside the EPA,” laments Steve Milloy, the former editor of JunkScience.com, which has posted a fact sheet that debunks the EPA’s PM 2.5 claims. “Whatever the EPA wants it gets. The agency is allowed to run rampant. There was a time when OIRA use to have stopping power, but now it’s just ignored. OIRA has become a rubber stamp.”
This is especially true of PM 2.5, Milloy says. “There is no real world evidence” PM 2.5 has caused sudden or long-term death, he said. “The claim that PM 2.5 kills people is at the heart and soul of how the EPA is selling these regulations. But it’s a claim that’s not supported by the facts or evidence. The EPA has rigged the whole process.”
Indeed, the purported co-benefits have become the benefits, according to Vitter’s report.
“Historically, EPA used co-benefits in major rules as one of several benefits quantified to justify a rule in the RIA,” the report says. “Yet, at the beginning of the Obama administration, there was a ‘trend towards almost complete reliance on PM 2.5-related health co-benefits.’ Instead of being an ancillary benefit, EPA started using PM 2.5 co-benefits as essentially the only quantified benefit for many CAA regulations.”
The Senate report claims all but five air pollution rules crafted between 2009 and 2011 listed PM 2.5.
Lack of Transparency at EPA
The Clean Air Act requires EPA to set air quality standards to protect public health with an “adequate margin of safety.” In its review of the National Ambient Air Quality Standards, the EPA considers factors such as the nature and severity of health effects, the size of the at-risk groups affected and the science.
Several exhaustive scientific reviews prior and subsequent to the 1997 standards were conducted following open, public processes that allowed for public review and comment prior to updating the standards.
EPA press secretary Liz Purchia told The Daily Signal in an email that the process is open enough.
The National Ambient Air Quality Standards are bolstered by “sound science and legal standards,” she said, and “several exhaustive scientific reviews prior and subsequent to the 1997 standards were conducted following open, public processes that allowed for public review and comment prior to updating the standards.”
Beale’s involvement in no way undermines the rational basis for the agency’s decisions nor the integrity of the administrative process. Reducing the public’s exposure to ground-level ozone and PM protects millions of Americans from costly and dangerous illness, hospitalization, and premature death.
All that may be true, but the EPA still won’t provide the underlying data to put the matter to rest.
Vitter and his team say this is because the EPA can continue to overstate the benefits and understate the costs of federal regulations—just as Beale did in the 1990s.
“This technique has been applied over the years and burdens the American people today, as up to 80 percent of the benefits associated with all federal regulations are attributed to supposed PM 2.5 reductions,” the report states.
Obama administration officials ripped into GOP proposals to tie Strategic Petroleum Reserve releases to increases in federal oil and gas land leases and to require new analysis of the economic impacts of several gasoline-related environmental regulations.
A new GOP bill would require a new interagency panel to analyse how certain future Environmental Protection Agency rules might impact gasoline prices and jobs, but an EPA official said the bill wouldn’t reduce prices at the pump and could threaten Clean Air Act health protections.
The Gasoline Regulations Act targets a number of looming EPA regulations, including one for cutting sulfur in fuel by two-thirds, U.S. ozone standards and refinery emissions standards.
Gina McCarthy, an EPA assistant administrator, said in written testimony that the bill appears to use high gas prices as the reason to rollback public health protections, but those protections have little to do with gasoline prices. The bill would also duplicate analysis that is already done by officials.
“This legislation also delays — indefinitely — rules that EPA has not even proposed,” McCarthy said. “In short, this legislation does not address the reasons for the recent increase in the price of gasoline, while rolling back core aspects of the Clean Air Act — which was passed on a bipartisan basis and signed by a Republican president.”
Gasoline prices have steadily become a growing political point as prices rise near the $4 mark for the first time since 2008. The national average hit $3.91 Wednesday, a rise of 2 cents, according to the AAA gas gauge. Houston drivers are paying $3.87, or 9 cents below the record-high price of $3.96 in July 2008.
As prices have risen, the Obama administration has touted an “all-of-the-above” energy plan that officials say is the best long-term solution to the rising energy costs. Republicans, however, have argued the administration should remove unnecessary regulations and spur domestic drilling.
Republicans have also recently proposed that a 1 percent increase in federal lands leased for oil and gas production be required for every percentage point drawdown in oil from the strategic reserve, a 700-million-barrel stockpile on the Gulf Coast for emergency supply disruptions.
That proposal also came under fire by Obama administration officials.
Deputy Assistant Energy Secretary Chris Smith said in written testimony that the Strategic Energy Production Act would make it more difficult for to respond promptly to supply interruptions in crude oil. He argued that the bill would also make release from the strategic reserve more dependent on actions of potential lessees.
“It would also limit DOE’s ability to manage the SPR on a day to day basis, in which releases occasionally are necessary for the routine maintenance and operation of the reserve,” Smith added.
Republicans are proposing the legislation in seeking to position themselves against Democrats and the White House on oil and gas policy, which has surged to the forefront of political debate in the wake of higher gasoline prices. GOP lawmakers insisted Wednesday their legislation would increase oil supplies and decrease refining costs, helping put downward pressure on gasoline prices.
Democrats have called for cracking down on what they view as excessive speculation in oil markets and urged the White House to consider releasing oil from the strategic reserve.
But analysts have repeatedly said policymakers have few, if any, short-term tools to address gasoline prices, which are tied to oil prices set on global markets.
James Burkhard, managing director at IHS CERA, a research firm, said in written testimony said the current run-up in oil prices, the biggest determinant of what consumers pay at the pump, stems from geopolitics, specifically from uncertainty linked to the Iranian nuclear issue.
Analysts have said increased U.S. drilling would take years to kick in and would have, at best, a fractional impact on oil prices. They also have said the strategic reserve is intended for use only during supply emergencies, not as a price-smoothing tool as some Democrats have advocated.
Obama has ripped into GOP proposals to expand drilling into new waters and lands as an election-year “bumper sticker” that wouldn’t reduce gasoline prices. He has touted an “all-of-the-above” strategy of more oil, gas, renewable energy and fuel-efficiency boosts to cut oil use as a long-term strategy for U.S. energy independence.
- US Gasoline Prices Top $3.90 (247wallst.com)
Obama has the power to delay new rules that will shut down 8% of all U.S. power generation.
Since everyone has a suggestion or three about what President Obama can do to get the economy cooking again, here’s one of ours: Immediately suspend the Environmental Protection Agency’s bid to reorganize the U.S. electricity industry, and impose a moratorium on EPA rules at least until hiring and investment rebound for an extended period.
The EPA is currently pushing an unprecedented rewrite of air-pollution rules in an attempt to shut down a large portion of the coal-fired power fleet. Though these regulations are among the most expensive in the agency’s history, none were demanded by the late Pelosi Congress. They’re all the result of purely bureaucratic discretion under the Clean Air Act, last revised in 1990.
As it happens, those 1990 amendments contain an overlooked proviso that would let Mr. Obama overrule EPA Administrator Lisa Jackson‘s agenda. With an executive order, he could exempt all power plants “from compliance with any standard or limitation” for two years, or even longer using rolling two-year periods. All he has to declare is “that the technology to implement such standard is not available and that it is in the national security interests of the United States to do so.”
Both criteria are easily met. Most important, the EPA’s regulatory cascade is a clear and present danger to the reliability and stability of the U.S. power system and grid. The spree affects plants that provide 40% of U.S. baseload capacity in the U.S., and almost half of U.S. net generation. The Federal Energy Regulatory Commission, or FERC, which is charged with ensuring the integrity of the power supply, reported this month in a letter to the Senate that 81 gigawatts of generating capacity is “very likely” or “likely” to be subtracted by 2018 amid coal plant retirements and downgrades.
That’s about 8% of all U.S. generating capacity. Merely losing 56 gigawatts—a midrange scenario in line with FERC and industry estimates—is the equivalent of wiping out all power generation for Florida and Mississippi.
In practice, this will mean blackouts and rolling brownouts, as well as spiking rates for consumers. If a foreign power or terrorists wiped out 8% of U.S. capacity, such as through a cyber attack, it would rightly be considered an act of war. The EPA is in effect undermining the national security concept of “critical infrastructure”—assets essential to the functioning of society and the economy that Mr. Obama has an obligation to protect.
He would also be well within the law to declare that the EPA’s rules are technologically infeasible. Later this year, for example, the EPA will release regulations requiring utilities to further limit mercury and other hazardous pollutants. Full compliance will be required by 2015, merely 36 months after the final rule is public, and plants that can’t be upgraded in time will be required to shut down.
Yet this is nearly impossible to achieve. Duke Energy commented to the EPA that its average lead time for retrofitting scrubbers was 52 months, including the design, purchase and installation of equipment and the vagaries of the environmental permitting process. For Southern Co., another big utility, it was 54 months, over 16 scrubber systems. Filter systems usually take anywhere from 34 to 48 months end to end.
The environmental regulatory system is so rigid that once a rule is in motion it is almost impossible to stop or roll back in a way that can withstand scrutiny in the courts. Mr. Obama allowed Ms. Jackson to begin the process, but we rehearse these details to show that he has the legal authority to minimize her damage. An executive order would not make these rules more rational or change them in any way. All it would do is delay them, giving businesses more time to prepare and to amortize the costs over a longer time.
The larger issue is whether the Administration’s green campaign is more important than economic growth. The EPA’s own lowball cost estimate for the mercury rule is $11 billion annually, though the capital expenditures to meet the increasingly strict burden will be far higher. That investment could be put to more productive uses than mothballing coal assets and replacing them with more expensive sources like natural gas. With nearly a tenth of America out of work, $11 billion year after year adds up.
We don’t expect Mr. Obama to take our advice and tell his regulators to cool it, but no one should believe the excuse that his hands are tied. Whatever he decides will speak volumes about his real economic priorities.
By Kevin Mooney on August 12, 2011 8:21 am
Oil drilling moratorium, union favoritism, ObamaCare mandates undercut business
Louisiana is beset with some of the most economically damaging regulations that flow out of Washington D.C, according to industry representatives and public policy analysts. Moreover, some small business owners view local level licensing practices within their own municipalities as being overly costly and redundant.
Anti-Energy Policies Remain in Effect
For starters, there is the moratorium on deepwater oil and gas drilling that the Obama Administration imposed in May 2010 in response to the British Petroleum oil well explosion. Although the moratorium was official lifted in October of last year, a “de-facto” moratorium remains in place, officials with the Louisiana Oil and Gas Association (LOGA), have argued.
The “political uncertainty” surrounding the Gulf region has discouraged companies from making investments that could help spur economic growth, Don Briggs, the LOGA president, has observed. As was previously reported, ten oil rigs have left the Gulf of Mexico since the moratorium went into effect and eight others that were heading into the region have been detoured away.
“When you have companies that would be spending hundreds of millions of dollars, or some cases, billions of dollars, they need certainty,” Briggs explained. “We don’t have that now and I don’t expect that we will anytime soon. We will be in a deteriorating position until this changes.”
Sen. David Vitter (R-La.) has announced that he will block the nomination of Rebecca Wodder to serve as Assistant Secretary for Fish and Wildlife Parks for the Department of Interior unless expiring Gulf drilling leases are extended for another year.
“Since the moratorium, oil and gas exploration in the Gulf of Mexico has been dramatically curtailed,” Vitter said. “In 2011 alone, more than 300 offshore drilling leases in the Gulf of Mexico are due to expire. If these leases are allowed to expire, they will revert to the federal government, killing jobs and cutting off potential revenue from exploration and production. The U.S. economy will greatly benefit by allowing the offshore energy industry to get to work and stay working.”
Earlier this year, Vitter also blocked the nomination of Dan Ashe to the Interior Department, but lifted it after new deepwater exploratory permits were issued. In addition, Vitter has successfully opposed an almost $20,000 pay raise for Interior Secretary Ken Salazar.
While Vitter’s actions have been effective, states like Louisiana that rely on cheap, affordable energy for their livelihood will most likely remain back on their heels for some time, Bonner Cohen, a senior fellow with the National Center for Public Policy Research (NCPPR), said.
“What you are seeing in Louisiana is only a small piece of larger mosaic being put together by the Obama Administration to make affordable energy as inaccessible as possible,” he observed. “From the administration’s war on coal to the serious consideration it is giving to imposing a nationwide regulation of hydraulic fracturing, to its shut down of deepwater drilling in the Gulf of Mexico, to its `endangerment finding” from the EPA [Environmental Protection Agency], the administration is practicing its own form of selected industrial sabotage.”
Although the Obama Administration failed to pass the Waxman-Markey “cap and trade” bill, it continues to pursue the same regulatory goals through the EPA and other federal agencies, Marlo Lewis, a senior fellow with the Competitive Enterprise Institute (CEI), has warned. As an alternative to pricing the carbon dioxide emissions from coal as part of a cap and trade program, the idea now is to simply prevent “conventional coal” from entering into competition with other energy sources, Lewis points out in “Green Watch,” a publication of the Capital Research Center (CRC.)
“Obama’s target is virtually identical to the mix of electricity fuels that would develop under Waxman-Markey,” Lewis explains. “Under Obama’s proposal, 80% of U.S. electricity would come from nuclear, natural gas, CCS, and renewable energy by 2035. Under Waxman-Markey, an estimated 81% would come from the same sources by 2030, according to the U.S. Energy Information Administration (EIA).”
The EPA also issued an “Endangerment Rule” back in Dec. 2009 that could have far reaching consequences for Louisiana businesses and average citizens. The rule claims that the “elevated concentration” of GHG (Greenhouse) emissions in the atmosphere “endangers public health and welfare.” This could create an enormous opening for additional regulatory mischief by misapplying and misusing the Clean Air Act (CAA), which makes no mention of “greenhouse gas” or the “greenhouse effect,” Lewis notes.
“If the Obama Administration is really were to impose the EPA’s Endangerment Rule on the nation, than the Clean Air Act could be transformed into a law that requires the United States to de-industrialize itself,” Lewis laments.
But the EPA insists it has the authority to implement new regulatory rules under the CAA under the U.S. Supreme Court’s Massachusetts v. EPA ruling in 2007. The court concluded that carbon dioxide (CO2) was an air pollutant as the term is defined within the parameters of the CAA.
Team Obama Advances Big Labor Agenda
The EPA has a long track record of anti-business activity that is well documented and not likely to change anytime soon Mike Mitternight, the president of the Factory Service Agency, an air conditioning service and installation company based in Jefferson Parish, observed. But he is equally concerned with the “pro-union” leanings of the National Labor Relations Board (NLRB).
“We always need to be concerned about the EPA,” he said. “Businesses have historically done battle with the EPA. But right now I’m looking over my shoulder at what the NLRB is doing. The pro-unionization rulings are something we need to keep our eye on.”
Mitternight is particularly concerned about a proposal to curtain the amount of time set aside for unionization elections involving private companies. If the rule change goes into effect, the NLRB would set elections from a current median time of 37 days to as little as 10 days from the filing of an election petition. They would also set pre-election hearings for 7 days after a petition is filed; the rules would also require the employer to respond to a pre-hearing questionnaire raising any legal issues or waive its right to do so. And finally, the new rules would defer a decision on the issues raised at the hearing till after the election, putting an employer at risk if the decision is challenged.
“From the point of view of small business, this is very problematic,” Mitternight said. “It means a union could break our employees out into small groups and attempt to unionize in a piecemeal fashion.”
Mitternight also expressed concern over the “repetitive nature” of the licensing policies in Louisiana municipalities that translate into multiple fees and taxes. The total sales tax is 9 percent in Orleans Parish and 8.75 percent in Jefferson. Therefore, if he makes a purchase in Jefferson Parish and pays the 8.75% and then subsequently installs equipment in New Orleans Parish, he must then pay the 1/4 percent difference as a use tax for installation in Orleans.
Mitternight holds an occupational license in Jefferson Parish but must also maintain an occupational license in Orleans Parish, which is used to collect the additional ¼ percent tax. In addition, he holds a statewide Mechanical Contractors license, but is also required to have both a mechanical and a gas fitters license in Jefferson, Orleans, Kenner, Plaquemines, St. Tammany, Slidell, Mandeville, St. Bernard, and any other similar municipality or Parish where he operates.
“I have to fill out the tax report form on a monthly basis and indicate where I made an installation in New Orleans and pay them the extra tax,” he said. “It can be an expensive proposition to be an air conditioning manufacturer because you have this multi-layered licensing and I see it as an over-regulation.”
ObamaCare Could Force New Bureaucracies, Higher Costs
Unless the U.S. Supreme Court intervenes and rules in favor of the lawsuits that challenge the constitutionally of President Obama’s new health care law, Louisiana and other states will be forced to accommodate new layers of bureaucracy and higher costs, a report from the American Legislative Exchange Council shows.
“ObamaCare’s Medicaid mandates will bring significant fiscal damage to already strained state budgets, especially when taking into consideration the amount states currently spend on Medicaid” the report warns. Louisiana’s own Department of Health and Hospitals has produced a study that shows implementation of ObamaCare will cost the state in excess of $7 billion over a 10 year period.
Rep. John Fleming (R-La.), who is also a medical doctor, points out that the “governmentalization” of health care has been in motion since the 1960s. The Patient Protection and Affordable Care Act (PPCA), the official title of ObamaCare, accelerates a harmful trend that must be reversed, he said.
“These policies are separating the patient from the private sector by inserting government with all its bureaucracy, additional costs and regulations,” he observed. “ObamaCare just makes this worse.”
Rep. Fleming has offered up two proposals, which would help to expand choice, lower costs and expand the influence of the private sector. Policymakers should “open up state lines” so that insurance companies must compete with one another and consumers can choose the best plan for their needs, he said. Fleming also supports the expansion of Health Savings Accounts (HSAs). They come with higher deductibles, but this also creates an incentive to save and to make “wise purchases,” he said.
“This is about putting consumers back in charge. Often times, we see them saving over and above what their deductible is in their Health Savings Accounts. ”
Louisiana is a plaintiff in the multi-state lawsuit that has been filed against ObamaCare.