Published: November 18, 2011
The New York Times today essays a lengthy examination of President Obama's decision to stop the EPA from issuing a new air quality standard for ground-level ozone. The story is largely about the politics of the decision, as the headline so clearly communicates, "Re-election Strategy Is Tied to a Shift on Smog."
The page one article and accompanying materials are thorough and fairly reported.* Reporter John Broder states the thesis thusly:
The full retreat on the smog standard was the first and most important environmental decision of the presidential campaign season that is now fully under way. An examination of that decision, based on interviews with lobbyists on both sides, former officials and policy makers at the upper reaches of the White House and the E.P.A., illustrates the new calculus on political and policy shifts as the White House sharpens its focus on the president’s re-election.
Since then the Administration has delayed two clean-air regulations, allowed expansion of oil drilling off Alaska -- we'll believe it when see it -- and in the Gulf, and then delayed the Keystone XL pipeline permitting, "Taken together, the moves mark the White House’s growing awareness of the costs of environmental regulation in a battered economy." We're not really clear how the President's decision to postpone approval of the pipeline fits -- after all, it stops economic activity and jobs -- but the general conclusion seems right. The election year is nigh, and environmental and energy issues will be major political issues.
But not only political issues. Too often the major media, the news reporters as well as the legions of commentators, cast policy disputes as purely political issues, determined only by their electoral (or campaign cash) implications. That tendency will only grow more pronounced as the 2012 campaigns move forward.
For Business Roundtable, at least, the ozone rule was and is an economic issue. Reporting on an Aug. 16 White House meeting business representatives had with Chief of Staff William Daley, Broder writes:
“The maps were on the table,” said Khary Cauthen, director of federal relations for the petroleum group [API] and a White House environmental adviser in the Bush administration. “One of the C.E.O.’s had a whole spiel he was going to do, ‘This is so bad here, so bad there,’ but Daley shut him up. He was like, ‘I got that.’ ”
John Engler, the former Republican governor of Michigan and president of the Business Roundtable, noted the burden to state and local officials. “I told him, ‘When there’s a cloud over your head about whether you’re going to be able to meet the new standard, you’re likely to lose new business to some other state,’ ” Mr. Engler said, referring to Mr. Daley.
The BRT's amassed many data and arguments against the ozone rule, but the basic case was an economic one: The costs are unjustified vis a vis any purported health benefits, the demands of compliance will slow economic growth, and along with all the other regulations pouring down from the Executive Branch, the result will be fewer jobs. And, why for goodness sake, is the EPA issuing the most expensive environmental regulation in history when unemployment is at 9 percent??
Did the President make the decision on ozone -- which BRT cheered -- or the Keystone XL pipeline delay -- which we sharply criticized -- because of politics? Ultimately, that's not our concern. The question is, is the decision the right one.
* Good story, really. A quibble however: "[Industry lobbyists and Republicans] claimed the rule would cost $90 billion a year — far above E.P.A.’s estimates — and put much of the industrial heartland out of business." The EPA's own updated Regulatory Impact Analysis [Page S1-4] put the annual costs of the 0.60 ppb standard as high as $90 billion by 2020. In addition, the EPA conceded, "[These] estimates assume a particular trajectory of aggressive technological change. An alternative storyline might hypothesize a much less optimistic technological trajectory, with increased costs, or with decreased benefits in 2020 due to a later attainment date." Seems to us that the $90 billion cost a year is, in fact, keeping within EPA's estimates.
UPDATE (7:25 p.m.): We should have done a better job acknowledging the health and environmental issues. Business groups, including BRT, reminded critics and questioners that CEOs and employees live in local communities, too, and are of course keenly interested in the air they breathe. But air quality is steadily improving under current standards, and at some point, there are diminishing returns. In addition, there's this point cited in Broder's article, made not by business but by governors:
Mr. Daley was well aware of state and local concerns. One of the strongest appeals came from North Carolina, a state Mr. Obama narrowly won in 2008. The state’s governor, Bev Perdue, a Democrat, argued against the new ozone rule. Her air quality director, B. Keith Overcash, wrote the E.P.A. pleading for a delay. “Lack of employment, loss of health care, and in some cases, loss of a home, also affect the health of our citizens,” he said.
“The governors had a big role,” Mr. Engler said. “They were very helpful.”