Overestimating the Costs of Carbon Constraints

With Congress moving forward on climate change legislation, the battle over the costs reducing greenhouse gas emissions is heating up. In mid-March, the National Association of Manufacturers (NAM) unveiled an economic analysis that found huge impacts from the provisions in the leading bill. (http://www.accf.org/nam.html ) GDP would be cut by more than $631 billion by 2030. More than 3 million jobs would be lost. Electricity and gasoline prices would double. Less than a week later, the EPA came out with its analysis, which has less alarming scenarios: GDP down less than $250 billion and only modest increases in gas and electricity prices. (http://www.epa.gov/climatechange/downloads/s2191_EPA_Analysis.pdf) Other analyses peg the costs as even lower. Some even see net increases in jobs thanks to the growth of green technologies.

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