Politics & Policy

Energize to Defeat This

The best that can be said of the energy legislation Nancy Pelosi and the Democrats are trying to ram through the House before the August recess is that it could be worse. The Senate version contained big increases in automobile fuel-efficiency standards that would have made cars less safe and more expensive. Pelosi couldn’t overcome opposition to that measure, and has taken it off the table.  Also, as of this writing, the bill doesn’t include the onerous renewable-energy mandate that the GOP managed to keep out of the Senate bill, although it could be added as an amendment at some point today. Even without those defects, however, there are plenty of reasons to oppose the House bill.

Let’s take, for starters, the provision that authorizes individuals to sue the federal government for damages caused by global warming. The bill establishes various mandates for federal agencies to reduce their greenhouse-gas emissions, and allows individuals to file lawsuits (and sue for up to $1.5 million per year) if they can prove that these mandates haven’t been fulfilled. This provision may as well have been written by some clever trial lawyer, dismayed at the success of the John Doe amendment last week and dreaming up new revenue streams. We can think of better ways to reduce the federal government’s emissions, most of which involve shrinking it.

The bill reads like a wish list for those who support government funding of “clean” energy sources — sources that, were they economically viable, would find investors in the market. For instance, it authorizes $1 billion in new spending to promote “clean energy” in developing countries. Precisely what this means is never defined, though in practice it will likely bring about such things as solar panels and windmills for China. It is preposterous, however, to think that China will take non-renewable energy sources offline, or stop adding new ones, simply because we have built it a few windmills. Well-targeted technology transfers might make sense, within limits, as an alternative to a restrictive cap-and-trade program for carbon emissions. But this is clearly not the Democrats’ intent, for their bill also includes a pilot cap-and-trade program.

Pelosi’s energy legislation would increase taxes on oil and gas companies by $15 billion in order to pay for tax credits for renewable energy. This would provide a glorious opportunity for the Democrats to excoriate one of their favorite villains, but, as is almost always the case with corporate taxes, they would be passed on to the consumer. The poor would be especially hard hit: As Sterling Burnett, a senior fellow of the National Center for Policy Analysis, pointed out this week, while families earning more than $50,000 per year spend just 4 percent of their income on energy, those earning between $10,000 and $25,000 per year spend 13 percent. So much for Pelosi’s “progressive” credentials.

As bad as the bill is, it could get even worse if amended, as it might be, to require that utilities generate 15 percent of their power using solar, wind, and other renewable-energy sources by 2020. Such dirigisme is simply a recipe for increasing electricity costs. The most intense opposition to this measure has come from states in the southeast, where wind power has a poor track record and would be incapable of generating sufficient energy. Members of Congress from southwestern states, meanwhile, worry that the provision could spark fights over already-scarce water for hydropower. If Republicans hold firm, Democrats might fail to win enough votes from these regions to pass the amendment.

Either way, Pelosi’s energy legislation deserves to sink. It contains a multibillion-dollar tax increase, authorizes billions in new spending, and opens up taxpayer wallets to lawsuits over the government’s inability to meet its own global-warming goals. The nation’s energy needs are best met when Congress keeps its hands off the market.

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