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  • Obama Postpones New Ozone Standards, Has More Work to Do

    President Obama may have finally added or saved a few jobs—7.3 million to be specific.

    In a surprising but welcome move, the President asked Environmental Protection Agency (EPA) Administrator Lisa Jackson to withdraw the agency’s draft for more stringent Ozone National Ambient Air Quality Standards (NAAQS).

    This is an important victory for businesses as well as the additional 565 U.S. counties that would have been pushed into non-attainment status and suffered economically as a result.

    The EPA’s regulatory overreach on this one rule would have destroyed 7.3 million jobs and nearly $700 billion in economic activity by 2020, and the EPA significantly overestimated the purported health benefits from a lower standard.

    The President says he wants to provide regulatory certainty and will stick with the schedule of reviewing the rule in 2013. That’s a good start to helping the economy recover, but if he truly wants to provide regulatory certainty, he should tell the EPA not to revisit the ozone rule at all and should re-examine other environmental regulations with massive economic costs and dubious environmental benefits.

    The costs for states to comply with a tightened ozone standard would have been substantial. These federal mandates for more strict ozone pollution can discourage companies from expanding, and counties that do not meet attainment measures could have lost federal transit funding. As Heritage Visiting Fellow Andrew Grossman writes:

    The economic consequences of non-attainment are severe. New and modified sources—factories, power plants, and the like—in non-attainment areas must employ costly emissions control technologies and offset emissions by taking other industrial capacity offline, directly costing jobs. At best, this drives up the cost of development and discourages businesses from expanding. At worst, it is a near prohibition on new industry. And where businesses are unable to relocate—such as is often the case with utilities—the result is higher costs for consumers.

    Clearly, no one wants to breathe dirty air, but the reality is that the ozone standards are already stringent to the point where they have a miniscule additional effect on public health. The costs of tightening the standard have outweighed the benefits in the past, and the new proposal would have demonstrated diminishing marginal returns—possibly to the vanishing point.

    Further, the EPA wildly inflates the alleged benefits of the new standards. A reduction in ozone-level standards would make sense if the economic benefits of better health (fewer doctor visits, fewer inhalers, higher work and school attendance, etc.) convincingly outweighed the costs of implementing the standard. But the reality is that the causality between a more stringent ozone standard and better health effects—especially for respiratory complications—is unclear, to say the least.

    From 1980 to 2005, when levels of ozone and other pollutants fell in the United States, the number of asthmatics increased by 75 percent. In fact, some of the lowest asthma rates in the world are found in highly polluted developing countries in the former Soviet Union, while countries in Western Europe have considerably higher asthma rates and relatively lower levels of air pollution.

    What is clear and well established, however, is that improved economic well-being means that people are healthier and live longer. A tighter ozone rule would slow economic growth, reducing economic well-being.

    President Obama should be commended for asking the EPA to withdraw this rule, but the ozone regulation is just one railcar saved from the EPA’s regulatory train wreck. The Administration should take further steps to provide businesses with regulatory certainty so they can expand and create jobs. There are a few other proposed rules the Administration needs to revisit, because they all miserably fail the cost–benefit test as well.

    Posted in Energy [slideshow_deploy]

    8 Responses to Obama Postpones New Ozone Standards, Has More Work to Do

    1. This is called "move all the really painful stuff until after I'm reelected, ala Obamacare mandates, etc. He's getting really desperate.

    2. Lloyd Scallan says:

      Watch out! The last time Obama said anything that most Americans agreed with is when he suggest he would allow more offshore oil/gas exploration. A few weeks later, the BP spill in the Gulf. Haven't we all
      learned that Obama does nothing for the good of this nation. Whatever he throws out, it's got a hook in it.

    3. TimAz says:

      If you really want jobs to be created then the EPA must be dismantled. As long as the EPA exists as a regulatory agency it will be a threat to job creation. The EPA can not be allowed to create regulations with total immunity from the will of the American people. Had enough yet?

    4. Kenneth Chilton PhD says:

      This is an extremely well-written article that points out the lack of any appreciable health benefits from a tighter ozone standard and the high cost of forcing companies to replace productive equipment with equipment that reduces ozone-forming emissions. This process has gone so far that the ozone standard is approaching background levels produced by only natural emissions.

      Real reform of the Clean Air Act must focus on changing its prime directive of setting National Ambient Air Quality Standards at a level where they "protect public health with an adequate margin of safety." Furthermore, EPA and Congress have interpreted this mandate to proscirbe considering costs and benefits in setting that level. Every major regulation should require cost-benefit analysis.

      • KJinAZ says:

        If they did a cost benefit analysis on the EPA they would be shut down. They only increase costs, and there is almost never ANY REAL BENEFIT.

    5. Stirling says:

      He's in campaign mode, and the polls are not his friend at this point. If he gets 4 more years he's going to bring every single enviromental job destroying ideas back to the table. What good is clean air when this country is a Bankrupt Shell owned by our debtors like China.. Lastly does any "Green" movement liberal think that a country like China wouldn't harvest this country for every natural resource it can (if given the chance) with no consideration for the enviroment (as they do in their own country.)

    6. Mike, Wichita Falls says:

      Obama's union buddies tell us and big corp that it's unpatriotic to send jobs overseas, yet they have little choice when his EPA even threatens to issue stricter ozone mandates. Set aside the fact that these regs have no basis in law and have not undergone Congressional debate, scrutiny and approval. Big corp needs to know these ozone standards, and the legion of other environmental regs, are off the table regardless of who sits in the Oval office in 2013 before they sink one more dollar into this country.

      Do not let the statists redefine patriotism. Patriotism is undying, unfaltering allegiance to the supreme law of the land, the contract between the states and people and their federal government, the Constitution.

    7. KJinAZ says:

      Obama has depleted more ozone with all of his hot air than any factory in America, so does that mean we can ban him?

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