It's a good idea for EPA to act
Q: Given the gridlock in Congress over the climate bill, is the Obama administration's fallback strategy to let EPA regulate greenhouse gas emissions a good idea?
Since the EPA has no choice but to regulate greenhouse gases, and could come under serious legal fire if it does not, it is a good idea for EPA to act. The Supreme Court decided in Massachusetts v. EPA that the agency had two options: either determine that greenhouse gases are not a danger to human safety, or do something about them. So what is the best way for Administrator Lisa Jackson to proceed?
To start with -- command-and-control regulation should be kept to a minimum. Instead the agency should use market-based mechanisms as much as possible. This will prove wise in either of the two possible congressional scenarios. First, if an economy-wide cap-and-trade bill is enacted, the EPA's regulations will be easily integrated into then new system, avoiding unnecessary costs for businesses.
On the other hand, if Congress does not manage to pass comprehensive climate legislation, EPA will have selected the most effective and efficient options to fill their legal mandate to curb greenhouse gases. Economists largely agree that it is more efficient to allow companies to decide how best to comply with new rules -- market-based mechanisms both obtain better results and are less burdensome for businesses.
Thus far EPA has taken more of a command-and-control route, announcing strengthened CAFE standards for automobiles earlier this year. These regulations were legally required -- there was no clear cap-and-trade alternative that would have complied with the law -- and in moderation, these types of regulations are a helpful start. But the agency should be wary of moving forward with too many rules like this. They are simply not the best long-term solution to address climate change -- clearly a long-term problem.
One interesting side-note is that the Massachusetts v. EPA decision was handed down in 2007, giving the Bush Administration plenty of time to refute the science of climate change. It seems a fair assumption that if they could have done so, they would have. That they didn't -- and instead ran out the clock for their time in office -- is strong evidence that science is, in fact, hard to deny.