EPA regulations create corporate winners and losers


Article Highlights

  • President Obama's allies will issue conflicting falsehoods this week on climate change and big business.

    Tweet This

  • President Obama's allies will issue conflicting falsehoods this week on climate change and big business.

    Tweet This

  • These story lines contradict one another. They also contradict the truth.

    Tweet This

President Obama's allies will issue conflicting falsehoods this week on climate change and big business.

The Environmental Protection Agency will roll out a regulatory scheme to curb the carbon dioxide power plants emit. The Obama administration and its supporters will pretend (a) these rules represent a war against greedy Big Business, and (b) these rules represent a groundbreaking consensus with Big Business.

These story lines contradict one another. They also contradict the truth.

Corporate lobbyists are divided on Obama’s current climate push, for a perfectly sensible reason: Obama’s rules benefit some companies while hurting others. This isn’t new. The history of climate policy is a story of some businesses seeing profit in regulation, and thus lobbying for regulation, and others seeing only costs, and thus lobbying against regulation.

Al Gore made the first serious push to curb greenhouse gas emissions in the U.S. The-then Vice President endorsed the Kyoto Protocol on Climate Change. The Clinton White House, however, soon realized Congress would never ratify the treaty. This didn't stop the Treaty's biggest boosters from trying, though.

“This agreement will be good for Enron stock!!” That was the bottom line of a 1997 memo by John Palmisano, an environmental policy executive at the notorious energy giant. Throughout the memo, Palmisano referred to various Enron “victories," such as a slush fund for renewable energy, the creation of a trading scheme in emissions credits and rules that would favor natural gas over its competitors coal and oil.

So Enron liked a policy that helped it get government money for reducing U.S. emissions. Environmentalists applaud that. But that same Enron memo also defended Kyoto's exemption for the developing world: Poor countries wouldn't be covered by the same emissions rules affecting the U.S. Guess what Enron was doing in Africa, Asia, and South America at the time? Building coal-fired power plants.

If Enron was burning coal in Africa, it would benefit from the U.S. shutting down coal-fired plants, because that would lower the global coal price. Making it more profitable for Enron to burn coal in Nigeria is an odd feature of a climate policy.

When Enron died, its heir in climate policy was the U.S. Climate Action Partnership. USCAP brought together the same environmental groups that used to applaud Enron with companies like General Electric and DuPont.

USCAP lobbied for a federal “cap-and-trade” scheme in emissions credits, similar to that required by Kyoto and currently proposed by Obama’s EPA. One USCAP member, AES, was pulling an Enron — lobbying to limit coal use in the U.S., while opening coal-fired plants in the developing world.

The Chamber of Commerce lobbied against Obama's attempt to curb emissions through legislation -- the 2009 Waxman-Markey bill -- while USCAP supported it. In April 2010, then-Sen. John Kerry lined up a group of corporate supporters for the Senate version of the bill. BP was one of those supporters. At the time, the company's Deepwater Horizon oil rig was burning.

Back in 2007, when the Supreme Court first ruled that carbon dioxide is a pollutant (and thus covered by the Clean Air Act), energy giants Calpine and Entergy filed an amicus curiae brief with the court supporting federal regulation of CO2.

In an April Supreme Court case on emissions where the EPA beat a power company, Calpine filed another pro-regulation amicus brief, along with energy giant Exelon.

Most industry lobbyists will oppose Obama's current rules, but many will see profit in them. One lobby, called “Advanced Energy Economy,” is applauding Obama. “We see this as a real opportunity," said Malcolm Woolf, an Obama donor and AEE's top lobbyist. AEE represents companies like First Solar and Johns Mansville, a manufacturer owned by billionaire Obama lobbyist Warren Buffett.

Each time one of these corporate-green collaborations occur, Democrats or the mainstream liberal media declare some sort of great breakthrough and a sign of consensus. This climate policy is so necessary and reasonable that even Corporate America is on board!!!

Simultaneously, others on the Left maintain that opposing climate regulation is simply doing the bidding of big business. Splenetic New York Times blogger Paul Krugman, for instance, attributed opposition to Obama's proposal to the fact that it “isn't good for the Koch brothers.”

These simple narratives are useful to Krugman and the Left. That they're false doesn't seem to bother them.

Timothy P. Carney, a senior political columnist for the Washington Examiner, can be contacted at [email protected] This column is reprinted with permission from washingtonexaminer.com.

Also Visit
AEIdeas Blog The American Magazine
About the Author


Timothy P.

What's new on AEI

In year four of Dodd-Frank, over-regulation is getting old
image Halbig v. Burwell: A stunning rebuke of a lawless and reckless administration
image Beware all the retirement 'crisis' reports
image Cut people or change how they're paid
AEI on Facebook
Events Calendar
  • 21
  • 22
  • 23
  • 24
  • 25
Monday, July 21, 2014 | 9:15 a.m. – 11:30 a.m.
Closing the gaps in health outcomes: Alternative paths forward

Please join us for a broader exploration of targeted interventions that provide real promise for reducing health disparities, limiting or delaying the onset of chronic health conditions, and improving the performance of the US health care system.

Monday, July 21, 2014 | 4:00 p.m. – 5:30 p.m.
Comprehending comprehensive universities

Join us for a panel discussion that seeks to comprehend the comprehensives and to determine the role these schools play in the nation’s college completion agenda.

Tuesday, July 22, 2014 | 8:50 a.m. – 12:00 p.m.
Who governs the Internet? A conversation on securing the multistakeholder process

Please join AEI’s Center for Internet, Communications, and Technology Policy for a conference to address key steps we can take, as members of the global community, to maintain a free Internet.

Thursday, July 24, 2014 | 9:00 a.m. – 10:00 a.m.
Expanding opportunity in America: A conversation with House Budget Committee Chairman Paul Ryan

Please join us as House Budget Committee Chairman Paul Ryan (R-WI) unveils a new set of policy reforms aimed at reducing poverty and increasing upward mobility throughout America.

Event Registration is Closed
Thursday, July 24, 2014 | 6:00 p.m. – 7:15 p.m.
Is it time to end the Export-Import Bank?

We welcome you to join us at AEI as POLITICO’s Ben White moderates a lively debate between Tim Carney, one of the bank’s fiercest critics, and Tony Fratto, one of the agency’s staunchest defenders.

No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.