In a recent blog post, Media Matters attempts to throw cold water on the notion that EPA’s planned revision to federal ozone standards later this year will carry a heavy economic cost for manufacturers and consumers. While we appreciate the attention that Media Matters is paying to the issue, their dismissal of the significant implications of this rule demonstrates a failure to recognize the urgency of the issue, or the manner in which it threatens to sap the energy from our nation’s economy.
Media Matters puts forth three critiques of our efforts to educate lawmakers and the public as to the dangers inherent to a new ozone standard. They say that our education efforts are biased toward industry. They say that the study NERA Economic Consulting (one of the most respected consultancies in the world and a frequent partner of U.S. government agencies such as the Department of Energy) prepared for us utilizes flawed methodology. And finally, they say that our education campaign is premature given the fact that a rule will not be proposed until later this year.
We’d like to set the record straight on a few of these accusations.
Our Study Shows Heavy Impacts on All Sectors of Our Economy – Not Just Manufacturing
Manufacturers – our members – will certainly be dealt a serious blow at the hands of such a rule, and our advocacy efforts will by design shed light on this fact. The manufacturing boom has brought thousands of jobs back to the United States, and it is poised to continue to do so against the right policy backdrop.
That said, EPA’s own analysis and this research both tell us that the costs associated with more stringent ozone standards will be felt throughout the economy. Businesses of all stripes, state and local governments, and consumers will share the burden of staying out of nonattainment. Many companies and consumers will face drastically higher costs, and all will be forced to contend with the economic pressures inherent to complying with more stringent standards.
Our advocacy efforts are driven by careful empirical study. The NERA analysis demonstrates clearly the widespread nature of this regulation’s potential impact. Manufacturers are among the hardest hit, but far from the only sector with grave concerns. Our campaign reflects this reality – not a bias toward one sector or another.
The NERA study is – by far – the best and most realistic forecast available today.
Media Matters cited statements from a small cadre of outside commentators – many of whom have a long history of bias all their own – to assert that the NERA Economic Consulting data is somehow flawed or unrealistic. This is simply untrue.
The fact of the matter is, NERA Economic Consulting is among the most respected economic consultancies in the world. Their work is utilized by governments around the world. President Obama’s own Department of Energy has commissioned analysis from NERA to forecast the economic impact of natural gas exports and other issues. And, to be blunt, their economic modeling is considerably more sophisticated and better established than the models used by, for instance, the EPA.
The NewERA model utilized to develop the analysis in this report incorporates all sectors of the economy. As Dr. David Harrison of NERA Economic Consulting noted during the press conference that we hosted to launch this study, “one of the key features of the ozone regulation, in contrast to some other regulations, is that virtually every sector of the economy would be affected so it’s necessary to have a model that simulates the interactions of these various sectors as well as the interactions with consumers.” The NewERA model provides this level of detail, and yields a far more complete picture of the scope of a regulation whose impact will be felt through so broad a cross-section of the economy.
In short, this study has the benefit of a full, bottom-up analysis by the most qualified and knowledgeable economists in this field. We are very confident that NERA’s evidence-based approach is by far the best and most realistic forecast available today, utilizing a thorough, evidence-based methodology to provide the type of reliable information that must be central to stakeholders’ consideration of this issue.
The most costly regulation in United States history could be less than 100 days away. This discussion is not premature – it is overdue.
Via a quote from the EPA, Media Matters contends that the NAM/NERA analysis is premature. This is an audacious claim. The notion that public input and education regarding an action on the part of the government – whether a small matter or one of great consequence – should wait until a certain procedural point of official proposal is absurd. EPA has offered revised standards twice in the last six years, and they are mere months away from doing it again. The time for this discussion is upon us and it has been for some time.
Regardless of one’s position on the issue, public discourse should be welcomed. Empirical analysis such as our recent study serves as vital intellectual feedstock and helps to inform the public and policymakers alike of what’s at stake.
In short, this dialogue can – and must be allowed to – yield a better path forward.
With so much at stake, we can’t allow this issue to become the latest “line in the sand” on environmental policy. We can’t allow one side to shout at the other, casually dismissing the validity or even the need for the other’s analysis. Realistic stakeholders on both sides of the aisle recognize the potential for serious economy-wide impacts from this particular rule. That’s why, after all, President Obama withdrew the most recent attempt to tighten this standard amid widespread concerns amongst Republicans and Democrats regarding the excessive costs and regulatory burdens compared to its assessed benefits.
In the interest of facilitating a careful consideration of the issues related to this regulation, we, along with NERA Economic Consulting, welcome others’ analysis of this important matter. To read more about this issue visit our website at www.nam.org/ozone.