While Wall Street waits with bated breath for any indication that Alan Greenspan spies inflation in the economy, the spanner heading for the economic works is coming from the Environmental Protection Agency's latest regulations and an environmental treaty that President Clinton intends to sign in Japan in December. Last July, the EPA succeeded in pushing through draconian particulate-matter (PM) standards despite opposition from the federal Clean Air Scientific Advisory Committee, Council of Economic Advisers, Congress, and 25,000 Americans who commented on the extremity of the proposed regulations.
According to Angela Antonelli, deputy director for economic-policy studies at the Heritage Foundation in Washington, the EPA's new standards will double the annual direct compliance costs of environmental regulations, raising them to $300 billion. These are the most expensive environmental standards in history, and the EPA has provided no evidence that they are needed.
CHANGING THE RULES. To get these standards through the regulatory process, the Clinton Administration violated its own cost-benefit and risk-assessment requirements for federal regulations. According to Sally Katzen, administrator of the Office of Information & Regulatory Affairs, an alternate interagency review process was established.
The EPA didn't want any cost-benefit analysis of the regulations because they wouldn't have passed muster. Studies by the Regulatory Analysis Program at George Mason University link lower income with higher mortality. As these costly regulations will reduce real family incomes, they could result in 7,000 deaths annually, many times the number of deaths that supposedly would be prevented by the change.
The EPA also managed to thumb its nose at recent "good government" laws, such as the Small Business Regulatory Enforcement Fairness Act of 1996 and the Unfunded Mandates Reform Act of 1995. These laws require regulatory agencies to consult with affected parties and prepare cost-benefit analyses for proposed rules. The EPA so thoroughly ignored the law that Representative Ron Klink (D-Pa.) admonished the agency: "This is a government of the people, by the people, for the people. You are ignoring us. You are saying you do not have to sit down and talk to us."
By failing in its oversight responsibilities, Congress has permitted regulatory agencies to run away with the law. One consequence is going to be the migration of U.S. industry to other places in the global economy. Patrick J. Buchanan, who is worried about Americans losing their jobs because of free-trade treaties, would find a more worthy target in the excessive environmental restrictions that are shoveling jobs out of the country.
HEAVY CASUALTIES. The granddaddy of them all is the new global-warming treaty to be signed in December. According to a suppressed Energy Dept. study, the conclusions of which were leaked, Clinton's treaty would have a crushing effect on U.S. industry. Its casualties would include the paper and allied products industry, petroleum refiners, aluminum producers, and iron, steel, chemical, and cement manufacturers. A study by Charles River Assn., a Boston consulting group, comes to the same conclusion.
The global-warming treaty is steaming ahead despite a recent article in Science (May 16) that reports that it will be a decade or longer before scientists have a clue as to whether humans are causing climate changes. Global warming is a prediction based on climate models that are full of unproven assumptions. One climate modeler, Michael Schlesinger of the University of Illinois, admits that researchers are able to take into account only a fraction of the factors that make up the climate system. Yet on the basis of such incomplete science, Clinton is jettisoning U.S. heavy industry.
The key to understanding the global-warming treaty is that it applies only to Japan and a few industrialized countries in North America and Europe. The treaty will move the affected industries out of the First World into the Third World. It is a story ready-made for conspiracy theorists. Under cover of the green movement, Third World politicians and their "one world" allies are redistributing economic power away from the industrialized democracies.
Poor Americans and poor Europeans are rich by international standards. In the one-world view shared by elites, there is as much justification for international economic redistribution as for domestic redistribution. Correcting the "imbalance of economic power" is what global-warming theories and environmental extremism are really about.