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The Policy and Commentary Blog of The Heartland Institute
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What Would Milton Friedman Say About Renewable Electricity Mandates?

October 10, 2014, 12:34 PM

Photo Credit: Academy of Achievement

In a May 23, 1977 column for Newsweek, titled “A Department of Energy?” the late Nobel laureate economist Milton Friedman wrote:

Do not be misled into supposing that the energy problem is a purely technical problem that engineers can solve. No government engineer is in as good a position as you are to decide whether you would rather use expensive energy for heating your home, driving your car, or helping to produce one or another product for you to buy. No government engineer is in as good a position as the owner of a factory to choose the most economical fuel for his purposes or the cheapest way to conserve energy. No government engineer can replace the market in calculating the indirect effects of energy use or conservation. And no government engineer will enforce the ever more numerous edicts that will come down from on high. That will be done by policemen.

Such a line is even more relevant today than it was back then. Not just because we do now, in fact, have a Department of Energy, but because of the 29 state laws across the country that more specifically do exactly what Prof. Friedman said would inflict great harm on the economy. Namely, force people to consume expensive energy – whether or not they value or can afford it – simply because the government believes it has the technical authority to determine what form of energy is the best for us to use.

These laws, called renewable portfolio standards (RPS), or renewable electricity mandates, are laws that require utilities to sell or produce a certain percentage of electricity from renewable sources. Find out if your state has an RPS law here.

The Heartland Institute has written about RPS policy and traveled the country testifying in favor of its repeal for years. Last June, Ohio Gov. John Kasich became the first Governor to sign legislation that reduced the RPS. Hopefully that will dramatically improve the odds for similar bills in other states to become law in 2015.

Photo: Academy of Achievement

Categories: On the Blog

Desperate Wildlife Extinction Claims are Part of the Warming Hoax

October 10, 2014, 10:57 AM

One thing that those of us who have been longtime observers and debunkers of the lies surrounding global warming and/or climate change have noticed is that the “Warmists” have gotten increasingly desperate after more than eighteen years in which there has been no warming.

As what they call “a pause” continues, they are coming up with some of the most absurd “research” to make their case.  When you consider that not one single computer model produced by the UN Intergovernmental Panel on Climate Change or any of the other charlatans was accurate, one can imagine their sense of panic at this point.

The latest claims were made by the wildlife group, WWF, the Zoological Society of London, and other affiliated groups. On October 1st, it was reported that, based on “an analysis of thousands of vertebrate species,” populations had fallen 52% between 1970 and 2010. In 2012 the same group had claimed they had declined 28% over a similar period of time. So now we are expected to believe that within two years’ time a massive larger decline had been detected.

The claims are absurd. I won’t insult you by repeating them. Suffice to say they did not begin to cover the thousands of species that share planet Earth with humans, but you can be sure that it was humans that got blamed for the alleged declines, along with the usual recommendations that we give up the use of fossil fuels and other aspects of modern life to save some furry creature somewhere.

For years we have been hearing that polar bears have been in decline, but one of the leading authorities on this species, zoologist Dr. Susan Crockford, has a report, “Ten good reasons not to worry about polar bears”, posted on the website of the Global warming Policy Foundation, led by Dr. Benny Pieser, a longtime critic of those behind the global warming hoax.

Dr. Crockford called polar bears “a conservation success story. Their numbers have rebounded remarkably since 1973 and we can say for sure that there are more polar bears now than there were 40 years ago.

Over on CFACT’s Climate Depot.com website, similar claims about walruses were debunked by Dr. Crockford who noted that mass haulouts (areas where they congregate) of Pacific walrus and stampede deaths are not new, now due to low ice cover. “The attempts by WWF and others to link this event to global warming is self-serving nonsense,” said Dr. Crockford,, “that has nothing to do with science…this is blatant nonsense and those who support or encourage this interpretation are misinforming the public.”

“The Pacific walrus remains abundant, numbering at least 200,000 by some accounts, double the number in the 1950s.”

The same time I read the article about the wildlife extinction claims, an email arrived from the Sierra Club—the kind they send to thousands who support its agenda—saying “For a mother polar bear and her cubs, the ice is already melting around them. The last thing they need to contend with is an oil spill.”  The claim about ice is another lie because Arctic ice has been expanding, not melting, in the same fashion as ice in the Antarctic. The real reason for the email was to protest “two massive drilling leases” and prevent access to Alaskan oil.

The Sierra Club and other environmental organizations have been on the front lines to get the Obama administration to keep the Keystone XL oil pipeline from being constructed. It has been senselessly delayed for six years despite the jobs and energy independence it will provide. One wonders if the top brass at the Sierra Club actually drive cars or do they all just bike to work?

In a similar fashion, in May the Union of Concerned Scientists announced that, thanks to climate change, our national landmarks such as Ellis Island, the Everglades, and Cape Canaveral will be endangered, claiming that face a serious and uncertain future in a world of rising sea levels, frequent wildfires, flooding and other natural events. Only the sea levels are rising in millimeters, not inches or feet. There have been fewer forest fires and far fewer hurricanes of late. In short, this is just one more desperate Green claim.

If the Greens are so concerned for wildlife, why don’t they protest the wind power turbines that slaughter thousands of birds and bats, and are exempted from prohibitions on the killing of eagles and condors? Because they are hypocrites, that’s why.

Species extinction, like climate change, is a normal, natural aspect of life on Earth. It has nothing to do with human activities. There were no humans around to blame for the Great Permian Extinction when 90% of all life on Earth was destroyed. Global warming periods and abundant carbon dioxide have never been causes of mass extinctions.

Craig Rucker, president of CFACT, the Committee for a Constructive Tomorrow, says the Warmists “actually want us to believe that global warming is responsible for the Ebola virus, the rise of ISIS, and for tens of thousands of walruses getting together to ‘haul out’ on a beach in Alaska. Attributing such things to global warming is among the most shameless tactics in the warming campaign’s playbook.”

© Alan Caruba, 2014

[Originally published at Warning Signs]

Categories: On the Blog

EPA Antics on Sea Level Rise–Gina McCarthy’s Miami Trip

October 10, 2014, 10:48 AM

EPA Administrator McCarthy is going to be in Miami October 8 during or close to a King Tide and I suspect call the high tide of the year due to global warming.  The reason for the name of King Tide is given by Wikipedia that follows this paragraph.  If global warming is blamed on King Tide’s, this will be another example of EPA distorting science to promote their damaging policies for the nation.

I believe Hurricane Sandy hit New York in 2012 during a King Tide; it definitely was during a full moon.

“King tides are simply the very highest tides. Conversely, the low tides that occur at this time are the very lowest tides. They are naturally occurring, predictable events. Tides are actually the movement of water across Earth’s surface caused by the combined effects of the gravitational forces exerted by the Moon and the Sun and the rotation of Earth which manifest in the local rise and fall of sea levels. Tides are driven by the relative positions of the Earth, Moon, and Sun, the elliptical orbits of the celestial bodies, land formations, and relative location on Earth. In the lunar month, the highest tides occur roughly every 14 days, at the new and full moons, when the gravitational pull of the Moon and the Sun are in alignment. These highest tides in the lunar cycle are called spring tides. The proximity of the Moon in relation to Earth and Earth in relation to the Sun also has an effect on tidal ranges. The Moon moves around Earth in an elliptical orbit that takes about 29 days to complete. The gravitational force is greatest when the Moon is closest to Earth (perigee) and least when it is farthest from Earth (apogee – about two weeks after perigee). The Moon has a larger effect on the tides than the Sun but the Sun’s position also has an influence on the tides. Earth moves around the Sun in an elliptical orbit that takes a little over 365 days to complete. Its gravitational force is greatest when Earth is closest to the Sun (perihelion – early January) and least when the Sun is farthest from Earth (aphelion – early July).

The king tides occur when the Earth, Moon and Sun are aligned at perigee and perihelion, resulting in the largest tidal range seen over the course of a year. Alignments that are ‘near enough’ occur during approximately three months each winter and again for three months in the summer.[contradiction] During these months, the high tides are higher than the average highest tides for three or four days. The predicted heights of a king tide can be further augmented by local weather patterns and ocean conditions. Winter king tides may be amplified by winter weather making these events more dramatic. In the northern hemisphere, the term king tide is used to describe each of these winter high tide events. On Australia’s East Coast, the highest of each of these periods (i.e., one in winter and one in summer, totaling two per year) are known as the king tides. In this region of the world, the winter king tide usually occurs at night and therefore goes unnoticed. Consequently the summer king tide usually catches the most attention.”

These activities are part of the reason the nation is going in debt between $1billion and $1.5 billion per day.

James H. Rust,  Professor of nuclear engineering and policy advisor The Heartland Institute

Categories: On the Blog

Abusive Tax Policies Are to Blame for Corporations Going Overseas

October 10, 2014, 9:15 AM

American companies that reincorporate abroad are not doing so to avoid paying taxes on U.S. earnings, despite the often misleading impressions left by the rantings of Senators Carl Levin, Dick Durbin, Elizabeth Warren, and others to the contrary. They are doing it to avoid paying U.S. taxes on earnings in other countries.

The United States is the only industrialized nation that uses a “worldwide” tax system, in which a U.S.-based corporation must pay taxes to our government regardless of where the corporation earns its money. Most of the rest of the world uses a “territorial” tax system, in which a corporation pays taxes only where it earns income.

For instance, Volkswagen and BMW pay taxes to the federal and state governments on income earned in the United States. If they bring that money back to Germany, where they are headquartered, Germany taxes none of it, because the United States has already taxed it. On the other hand, if a U.S.-based company earns income in Germany and wants to bring some of it back into this country, the company must pay federal tax even though the money has already been taxed in Germany.

This is a huge disadvantage to multinational corporations based in the United States and a big reason for corporate “inversions,” the word used to describe U.S. companies reincorporating in foreign countries. Compounding the disadvantage is this: The United States has the highest corporate tax rate in the industrialized world. The federal rate is 35 percent, and most states levy their own corporate tax on top of that.

The Tax Foundation earlier this year noted the combined (state and federal) average corporate tax rate in the United States is 39.1 percent, while the average rate is 25 percent among the 33 other nations in the OECD (Organization for Economic Cooperation and Development). OECD nations include Australia, Canada (this nation’s largest trading partner), France, Germany, Japan, Korea, Mexico, Sweden, and the United Kingdom.

In a recent interview with Budget & Tax News, Chris Edwards, director of tax policy at the Cato Institute, noted Canada has a net corporate tax rate of 15 percent—less than half the U.S. federal rate of 35 percent—and receives as much corporate tax revenue as a percentage of its gross domestic product as the United States receives.

“We don’t find companies trying to invert out of Canada or Ireland these days, because they have reasonable corporate tax policies,” Edwards said. “Left wingers like Durbin and [Sens. Carl and Rep. Sander] Levin talk about how government is losing money because of these inversions. The government is losing because their policies are inducing companies to move offshore.”

Pete Sepp, executive vice president of the National Taxpayers Union, also noted, “PricewaterhouseCoopers’ annual ‘Paying Taxes’ study shows that for a hypothetical medium-sized firm, the time and cost spent just on tax paperwork puts the U.S. 61st out of 189 countries. Somehow the chant of ‘We’re 61!’ doesn’t seem to have much appeal to a beleaguered business.”

Sen. Carl Levin (D-MI) has introduced a bill that would virtually end the ability of American companies to do inversions. So has Durbin (D-IL), who has seen the news that two Illinois-based companies, including Walgreen Co., the nation’s largest pharmacy chain, are mulling overseas mergers to do inversions. In response he has introduced the “Patriot Employer Tax Credit Act,” a bill his press statement says “would provide a tax credit to companies that provide fair wages and good benefits to workers while closing a tax loophole that incentivizes corporations to send jobs overseas.”

Notice the slam against the “patriotism” of companies that do inversions.

Lack of patriotism and “tax loopholes” are not the problem. The problem is a nation with the highest corporate tax rate in the industrialized world, a government that taxes income earned anywhere in the world, and an outrageously time-consuming and costly system just to pay taxes.

Until those problems are addressed, expect more U.S. companies to try to reincorporate outside the United States, and expect almost no companies outside the United States to try to reincorporate here.

Steve Stanek (sstanek@heartland.org) is a research fellow at The Heartland Institute in Chicago.

Categories: On the Blog

Wireless Taxes Growing Out of Control

October 10, 2014, 9:00 AM

Wireless tax rates have reached all-time highs. Almost half the states nationwide now impose a wireless tax above 10 percent. According to a new report released this morning by the Tax Foundation, the national average, consisting of  the combined federal, state, and local taxes and fees on cell phone bills, has now reached as high as 17.05 percent. Broken down, this historically high tax rate is comprised of a 5.82 percent federal rate and an average 11.23 percent state-local rate. Even as revenue earned per wireless phone falls, taxes and fees continue to climb.

In a media release on the study, Joseph Henchman, Vice President of Legal & State Projects at the Tax Foundation argues that state and local legislators should look away from wireless taxes for new tax revenue.

“Accessing content on our phones these days is easier than ever before, but paying cell phone bills remains difficult for many,” said Joseph Henchman, Tax Foundation Vice President of Legal & State Projects. “Instead of singling out wireless services with stealth tax increases, state and local governments should seek more neutral and less disruptive sources of revenue.”

According to CTIA, a wireless industry trade group, around 326 wireless device connections exist in the United States today (this number includes devices like smartphones, feature phones, tablets and personal wireless hotspots). In addition, according to the National Center for Health Statistics, around 41% of U.S. households have only wireless phones in the second half of 2013, indicating a move away from traditional landlines.

Scott Mackey of KSE Partners, co-author of the report argues in the media statement that wireless taxes are regressive and pose a threat to wireless network development.

“Wireless taxes and fees are regressive and have a disproportionate impact on poorer citizens,” said Scott Mackey of KSE Partners and co-author of the report. “Excessive taxes and fees may reduce low-income consumers’ access to wireless service at a time when such access is critical to economic success.”

Additionally, targeted cell phone taxes may slow investment in wireless infrastructure by lowering consumer demand for wireless service. “The reduced demand impacts network investment, because subscriber revenues ultimately determine how much carriers can afford to invest in network modernization,” adds Mackey.

In the report, Wireless Taxation in the United States 2014, the authors examined state, local and federal wireless taxes, creating state and local tax rankings. Below is a review of some of these findings:

The report finds that:

  • The five states with the highest state-local rates are: Washington State (18.6 percent), Nebraska (18.48 percent), New York (17.74 percent), Florida (16.55 percent), and Illinois (15.81 percent).

  • The five states with the lowest state-local rates are: Oregon (1.76 percent), Nevada (1.86 percent), Idaho (2.62 percent), Montana (6.00 percent), and West Virginia (6.15 percent).

  • Four cities—Chicago, Baltimore, Omaha, and New York City—have effective tax rates in excess of 25 percent of the customer bill.

  • The average rates of taxes and fees on wireless telephone services are more than two times higher than the average sales tax rates that apply to most other taxable goods and services.

  • States favor the taxes because they can raise revenue in a relatively hidden way.

With wireless taxes growing out of control, legislators should take another look at Wireless Tax Fairness Act, a bill designed to slow the growth of these taxes. The Act would put a five-year moratorium on discriminatory state wireless phone and data service tax increases. Although this wouldn’t prevent governments from creating new taxes and fees on all communications, it would disallow them from targeting any one service. A five-year freeze would slow the rate of tax increases while allowing more time to create a new taxing system for wireless that is more carefully developed, fair, and non-disruptive.

High wireless taxes drag down both consumers and the wireless market, deterring innovation and infrastructure improvements, while disproportionately affecting minority and low-income populations. Many of these groups support lower wireless taxes. As an example, according to a MyWireless study conducted by McLaughlin & Associates partnered with Penn Schoen Berland, nine in ten Hispanics believe the wireless tax rate should be the same or less than the taxes they pay on general goods and services.

Placing a moratorium on these discriminatory tax hikes would benefit the economy and consumers.

Categories: On the Blog

No, A Carbon Tax Cannot Create Jobs, Jobs, Jobs

October 09, 2014, 8:02 PM

A tax on carbon dioxide emissions would destroy far more jobs – and wealth – than it would create, despite the well-intentioned hopes of Forbes.com contributor James Conca.

In a Forbes.com article titled “Can A Carbon Tax Create Jobs, Jobs, Jobs,” Conca argued a carbon dioxide tax would result in a net increase in jobs if the tax revenues were spent wisely. Key to this hopeful prognosis, Conca asserted, is the requirement that a newly imposed tax on carbon dioxide must be revenue-neutral, with carbon dioxide tax collections being offset on a dollar-for-dollar basis by tax reductions in other sectors of the economy.

Conca never explained how merely shifting tax burdens from one sector of the economy to another creates jobs and wealth. Instead, he simply cited three short articles and one longer paper written and published by liberal activists. On important policy issues of the day, however, blindly deferring to self-serving papers written by liberal activist groups, such as the notorious Center for America Progress, is a recipe for disaster. Yes, that is the same Center for American Progress that championed Solyndra and promised Obamacare would lower healthcare premiums, create jobs, and make American families richer.

There are many reasons – economic and otherwise – why a tax on carbon dioxide is a bad idea. Let’s examine just two of the economic reasons.

First, Conca concedes that higher taxes are economically harmful. His solution is to reduce taxes in other sectors of the economy. The problem is the same liberal activist groups who want to implement carbon dioxide taxes oppose corresponding tax cuts. The Center for American Progress, for example, says carbon dioxide tax revenue should be given to the renewable energy industry rather than returned to the American people.

Curiously, the Center for American Progress fails to disclose that it is funded by the renewable energy industry and its founder and chairman of the board has a long and successful career as a renewable energy lobbyist. Conca must first convince his liberal activist group allies to not pilfer carbon dioxide tax revenues before he can plausibly argue that carbon dioxide tax revenues would be returned to the American people. (Good luck on that, by the way, because the Center for American Progress argues very strongly that the renewable energy industrymust get to keep the tax spoils rather than government returning the tax money to the American people.)

Second, even in the unlikely event that government returned carbon dioxide tax revenue to the American people on a dollar-for-dollar basis, this would be revenue-neutral for government but not for the American people. The entire purpose of a carbon tax is to raise the price of inexpensive coal and natural gas so high as to become more expensive than carbon-free wind and solar power. However, if the carbon tax fulfills its goal of raising coal and natural gas prices higher than wind and solar prices, energy providers will no longer use coal and natural gas and energy producers will therefore pay little if any carbon tax.

As a result, consumers will pay dramatically higher energy prices but receive little if any compensating tax cuts in return. American families’ net disposable income will drop, which will reduce spending and destroy jobs in all other sectors of the economy. The only beneficiary of this energy-policy Ponzi scheme will be the renewable energy industry. This explains why the renewable energy industry-funded Center for American Progress supports the Ponzi scheme so much.

No credible economists claim that reducing American households’ disposable income will grow the economy and create jobs. Yet taxing carbon dioxide sufficiently to reduce carbon dioxide emissions will by purpose and designdramatically raise energy costs in a manner that will substantially reduce American household income while generating few corresponding tax rebates. Economically, all that will be accomplished will be poorer American families, economy-wide economic contraction, jobs destroyed in virtually every American industry, and a Solyndra-style transfer of wealth from hard-working American consumers to incompetent, uncompetitive, politically connected renewable energy companies.

It is a nice thought, James Conca, but no, a carbon tax cannot create jobs, jobs, jobs.

[First published at Forbes.]

Categories: On the Blog

Ban on Internet Access Taxes Should be Retained

October 09, 2014, 2:41 PM

The Permanent Internet Tax Freedom Act is common-sense Internet policy that is a long time coming. Internet access taxes are particularly damaging to the growth of the Internet economy by placing an unnecessary burden on consumers. A permanent Internet access tax moratorium would help broadband access and development expand while reducing the need for government broadband spending. The moratorium is currently set to expire November 1, but legislation is now moving through Congress that would permanently extend the moratorium.  The bill, titled the Permanent Internet Tax Freedom Act (PITFA), was written by Judiciary Chairman Bob Goodlatte (R-VA) and co-sponsored by 138 Republicans and 76 Democrats.

While most states are currently covered under the moratorium, taxpayers in the states currently imposing these taxes could see their Internet bills decrease. If passed and signed into law, PITFA would make the ITFA moratorium permanent and force these seven states to cease imposing taxes on Internet access. These states are able to impose these taxes due to a “grandfather clause” in IFTA that allowed the states that already imposed the tax to keep them. These seven states, include Hawaii, New Mexico, North Dakota, Ohio, South Dakota, Texas and Wisconsin.

While the seven states will see a drop in tax revenue, experts do not expect the end of the tax to be a budget busting problem. According to Stateline, the seven states and their local governments stand to lose about $500 million annually in revenues, which while not insignificant only represents a small portion of most state budgets. Wireless services are already taxed higher than almost all other goods and services, the Tax Foundation found that almost half the states nationwide now imposing a wireless tax above 10 percent. The wireless consumers in seven states that would be freed from Internet access tax under PITFA, allowing them to expand their Internet services or use the savings elsewhere in the economy.

Making the Internet access tax moratorium permanent is a necessary step in promoting wider access to the Internet while keeping the cost down and eliminating discriminatory taxes. As the Internet has become one of the driving forces behind economic growth across the United States, ensuring affordable access for businesses and consumers is crucial. The Internet Tax Freedom Act Coalition, a group including telecom companies, tax watchdog groups and free market think tanks sent a letter in June to Chairman Goodlatte supporting his work to pass the Permanent Internet Tax Freedom Act.

Dear Representative Goodlatte,

The Internet Tax Freedom Act (ITFA) Coalition, a group of communications and technology companies, business associations and consumer groups, applauds the House Judiciary Committee for taking the first step to avoid new Internet access taxes on millions of Americans across the country with today’s markup.

We greatly appreciate your continued leadership on this issue, and stand ready to work with you and your colleagues to ensure swift passage of a clean bill to make the moratorium on taxes on Internet access and multiple and discriminatory taxation of Internet commerce permanent before the current Internet tax moratorium expires on November 1, 2014. With strong bipartisan support in both chambers of Congress, these bills should be considered for passage without unnecessary delays to protect American consumers from new taxes on their Internet access.

Again, we thank you for your leadership on this issue, and the ITFA Coalition looks forward to working with you to achieve the goal of making the Internet tax moratorium permanent for all Americans.

Sincerely,

The Internet Tax Freedom Act Coalition

Andrew Lundeen of the Tax Foundation noted in an article on PITFA that no real policy purpose exists for a tax on Internet access. “Additionally, there doesn’t seem to be a good reason to tax internet access in the first place. Governments tend to levy taxes on goods or services as a way of correcting for an externality or paying for the costs of a provided service.” “The internet does not create any evident externalities and may, in fact, have positive externalities associated with it. Additionally, state and local governments don’t seem to be providing any services associated with internet access.”

In a separate letter to the House of Representatives, Americans for Tax Reform takes the argument even further, pointing out that communication taxes are in many instances far worse than other sales taxes.

“Taxation of communications services is punitive and discriminatory. The average sales tax rate on voice services is 17 percent, and 12 percent on video services, while the average general sales tax rate is 7 percent. PITFA would at the very least prevent targeted taxes on Internet access, and disproportionate sales or other taxes on ecommerce.

Increased costs hinder continued growth in the digital space. As reported by the FCC’s National Broadband Plan, the largest barrier to consumer adoption and expanded use of Internet based services is cost. Allowing higher costs through Internet access taxes, which increase consumer cost and affect the rate of adoption, undermines America’s economic competiveness.”

While supporters of increased access taxes have argued that the taxes are needed to fund programs to help expand broadband to underserved areas, broadband coverage is already widely available and these programs may be unnecessary. Internet access taxes place an unnecessary burden on consumers in order to do something the market is already handling quite effectively. The current system is a hodgepodge of state and local access taxes competing against states without a tax. Making the Internet access tax moratorium permanent and ending the grandfather clause would help broadband access and development expand while reducing the need for government broadband spending.

Categories: On the Blog

Heartland Daily Podcast: Ilya Shapiro – Article V Amendment

October 09, 2014, 1:30 PM

A new movement is spreading to state legislatures across the nation, attempting to do something which has never been done before: amend the United States Constitution from the grassroots up.

Using mechanisms embedded within the Constitution itself, activists are seeking to make reforms that have been successfully demanded of elected officials for decades. However, many people are unaware of how this process works — and many fewer aware that it’s even occurring.

Cato Institute Senior Fellow in constitutional studies Ilya Shapiro recently joined Heartland Institute Research Fellow Jesse Hathaway, explaining how the Article V amendment process works, and how it might be used to enact sound fiscal policy at the national level.

 

Categories: On the Blog

Obama Misleads Northwestern Students About Climate and Energy

October 08, 2014, 6:17 PM

In his October 2 address on the economy at Northwestern University, President Barack Obama told students:

If we keep investing in clean energy technology, we won’t just put people to work assembling, raising and pounding into place the zero-carbon components of a clean energy age. We’ll reduce our carbon emissions and prevent the worst costs of climate change down the road.

But what does climate change have to do with energy supply? Almost nothing.

Climate change issues involve environmental hazards, whereas energy policy is concerned with supplying affordable, reliable electricity to industries and families. So where is the relationship to climate?

Until the 1980s, there was none. That one is now perceived testifies to the effectiveness of relentless lobbying by environmentalists and commercial special interests towards the idea that carbon dioxide (CO2) emissions from hydrocarbon-based power-generation will cause dangerous global warming.

So far, that has not happened. It has now been 18 years with no measurable planetary warming.

However, this warming disaster idea has become so entrenched that even prime ministers and presidents now misuse “carbon” as shorthand for “carbon dioxide,” and often call this plant-fertilizing gas a pollutant. For example, during his 13-minute address at the UN’s Climate Summit 2014 in New York City September 23, Mr. Obama referenced “carbon pollution” seven times and “carbon emissions” five times. That’s almost one misnomer per minute.

In reality, CO2 is environmentally beneficial. It is the elixir of life for most of our planetary ecosystems. Without it, life as we know it would end. No evidence exists that the amount humans have added to the atmosphere is producing dangerous warming or, indeed, any climate or weather events noticeably different in frequency, duration or intensity from human experience over the past couple of centuries.

Many negative consequences flow from wrongly connecting energy and global warming issues. Foremost among them has been a lemming-like rush by governments to generously subsidize what are otherwise uneconomic sources of energy, solar and wind power in particular.

The International Renewable Energy Agency reports that worldwide investment in renewables (not counting large hydropower) amounted to an incredible $214 billion in 2013 alone! IRENA insists that these expenditures need to more than double by 2030, to achieve the impossible goal of restricting average global temperature rise to 2 degrees Celsius by the end of the century.

However, results to date show that those investments have brought few benefits, and much harm. European studies have found that expensive, unreliable wind and solar power kills two to four jobs for each “renewable” energy job this heavily subsidized industry creates.

Mr. Obama paints alternative energy sources as environmentally virtuous, because they supposedly reduce CO2 emissions and provide renewable and clean sources of power. This too is highly misleading.

Wind and solar energy are certainly renewable – when the wind blows and the sun shines. But there is no power otherwise, so it’s tough luck if that’s when a hospital needs electricity for emergency surgery. Such intermittency also makes these sources entirely unsuitable as major contributors to national energy grids, to power factories, schools, businesses and families. The use of wind and solar power also increases the cost of electricity dramatically.

Moreover, these sources are assuredly not renewable when you consider the enormous amounts of land, mining, energy and raw materials required to build the wind and solar facilities, the extremely long transmission lines required to carry their electricity to urban centers, and the backup fossil-fuel generators needed the 80-90% of the time the renewable sources aren’t working.

Alternative energy sources are also far less environment-friendly than the President would have us believe. Wind turbines kill millions of birds and bats every year, and some rare species will undoubtedly be vulnerable to extinction if wind power continues to expand near important wildlife habitats. Massive solar installations have a disastrous effect on desert ecosystems and incinerate important bird species.

And yet the wind and solar generators are typically exempt from environmental laws that are used to block many other activities.

These problems are becoming apparent even to the European Union, once the world’s green energy leader. EU Energy Commissioner Gunther Oettinger recently said European energy policies must change, from being climate driven to being driven by the needs of industry, and job preservation. He could have included families, because millions of European households can no longer afford to heat their homes properly, due to soaring energy prices.

All nations need to return to the historic separation that previously existed between energy policy and climate policy. They must analyze and plan for both, in accord with their own distinct requirements and resources, and based on defensible environmental, technological, and economic analyses.

This means abandoning Mr. Obama’s naïve mantra that our energy choices affect global climate.

Categories: On the Blog

Heartland Daily Podcast: Kathleen Hartnett White – Fossil Fuels, the Moral Case

October 08, 2014, 1:19 PM

Kathleen Hartnett White, is the Director of the Armstrong Center for Energy & the Environment Texas Public Policy Foundation. Kathleen was not always a think tank wonk, but rather served a six-year term as Chairman and Commissioner of the Texas Commission on Environmental Quality (TCEQ) the second largest environmental regulatory agency in the world after the U.S. Environmental Protection Agency.

Kathleen ran an agency with more than 3,000 employees, with annual budget of over $600 million, so she comes at her work with the insight of a regulatory insider.  More recently, Kathleen wrote a great study for the Texas Public Policy Foundation: Fossil Fuels: the Moral Case

In this edition of the Heartland Daily Podcast, Kathleen dispels the Malthusian myth, argues that we have abundant energy and are foolish if we don’t use it to make peoples lives better, and makes the case that it is immoral for people in the developed world to keep people in developing countries impoverished in terms of energy accessibility thus condemning millions of the world’s poor to poverty and premature death to in the cause of preventing future climate change.

Listen via the player above.

Subscribe to the Heartland Daily Podcast free at this link.

Categories: On the Blog

Parents, Teachers Increasingly Reject Common Core

October 08, 2014, 1:10 PM

It’s been a rough year for the Common Core standards. As parents, teachers, officials, and politicians learn more about the standards, more and more states are considering ways to get out of Common Core. The standards in math and reading were allegedly designed to make students career- and college-ready. Now that the public is able to see them, the standards have proven not to be what was promised. People are fighting back.

Parents in states across the country have organized grassroots organizations to stop Common Core, including in Illinois. Teachers such as Marsha Griffin of Jonesboro Elementary in Illinois are speaking out against the standards. Griffin broke down crying when asked why she opposes Common Core.

“I have spent more time crying, coming into the classroom this year, than I have ever before,” said Griffin. “I have been given a great responsibility to teach these students. It’s my job to teach these students how to be well-rounded individuals. I don’t feel like I am doing that with this Common Core.”

Griffin said she felt a moral responsibility to speak up for her students and notes Common Core requires teachers to force specific strategies on how students find correct answers. She said she thinks employers are more interested in accuracy and efficiency than the specific way of getting there. The fourth-grade teacher predicts a mass exodus of students from traditional public schools as parents and students grow increasingly frustrated with Common Core.

“The pure joy of learning is disappearing from the educational landscape in the United States. I fear it will be a landscape where individuality is no longer valued,” Griffin said.

Oklahoma and Indiana have repealed the standards. Missouri, North Carolina, and South Carolina have adopted legislation to review Common Core. A few weeks ago, a school district in Lee County, Fla., voted to opt out of Common Core testing — but it rescinded the decision after officials warned the district its students would not receive standard diplomas and therefore might be unable to earn college credit.

That exemplifies one of the many problems with Common Core. Its proponents continue to swear the standards are voluntary, arguing states freely chose to sign up for Common Core in hopes of winning federal Race to the Top money. But the process wasn’t voluntary at all. States were bribed to adopt the standards in hopes of winning money through the federal Race to the Top program.

Louisiana Gov. Bobby Jindal is suing the federal government for this exact reason. The U.S. Department of Education and Education Secretary Arne Duncan are named in the suit for violating the 10th Amendment of the Constitution by essentially forcing states into Common Core through the Race to the Top program. The suit argues states had to “enter binding agreements to adopt and fully implement a single set of federally defined content standards and to utilize assessment products created by a federally-sponsored ‘consortia’.”

The feds will most certainly argue Race to the Top was voluntary, that states did not have to participate in Common Core or Race to the Top. That is true under the strictest interpretation, and a handful of states did opt not to participate.

The Obama administration did something very clever here. Tying billions of dollars in federal funding to the adoption of specific education policies — including Common Core — allowed the administration to get its way on the cheap while pretending it was all voluntary. It was like running a raffle with billions of dollars as the prize, and the entry ticket being a simple matter of selling your state’s soul to the feds.

Not many states managed to resist the temptation. Many state officials who signed up for Common Core did so without seeing a final version of the standards beforehand. Few eventually got any Race to the Top money. Now these standards are being shoved down the throats of parents, teachers and students. As the Lee County district in Florida discovered, getting away from the standards is not a decision you can easily make. The administration’s scheme was sneaky, underhanded and cunning.

Then there is the fact the ACT and SAT are being redesigned to align with Common Core. This means parents who put their children into private schools or homeschooling will not be able to avoid the standards unless their children do not go to college.

Under the law, education and curriculum are supposed to be state issues. According the State Supremacy Clause of the Constitution, education is to be handled on the state and local level. It is not enumerated as a federal power in the Constitution.

In addition to the legal restriction, there is a commonsense reason control of curriculum is left up to the states and not the federal government. What a parent would want their child to learn, what makes sense for the way a child is taught, is not going to be the same in urban Newark, N.J., as in the village of Sabina, Ohio. Local control of curriculum frees taxpayers and parents to ensure local schools meet their children’s needs.

Common Core supporters argue standards are not the same as curriculum, but that’s a flimsy claim and a trick of semantics. Standards very clearly and directly affect curriculum — defining what students need to know means defining what they will be taught.

The Common Core debate should be about what is best for students and taxpayers, not educrats and powerful multinational corporations. National standards like Common Core have been shown to have no ability to increase student achievement, and they inevitably take away local and state control of education policy. Experts from across the nation confirm the Common Core standards are academically mediocre at best.

Clearly, Common Core is not the best we can do for students or for taxpayers. Writing better standards at the state level is a far better solution to the problems plaguing the state’s education system.

Heather Kays (hkays@heartland.org) is a research fellow of The Heartland Institute and managing editor of School Reform News.

[Originally published at Illinois Business Journal]

Categories: On the Blog

Why Waxman’s FCC Internet Utility Regulation Plan Would Be Unlawful

October 08, 2014, 12:01 PM

Rep. Henry Waxman, Ranking Member of the House Energy and Commerce Committee,wrote the FCC to propose that the FCC, in its pending Open Internet order remand, “reclassif[y] broadband providers as telecommunications services and then using the modern [Title I] authority of section 706 to set bright-line rules to prevent blocking, throttling, and paid prioritization.”

In response to an FCC request for comment on whether the FCC should continue to regulate broadband under its Title I Section 706 broadband authority (as the D.C. Appeals CourtVerizon v. FCC decision suggested), or should reclassify the Internet under Title II common carrier utility regulation, Rep. Waxman recommends the FCC try and use both Title I and Title II, and in such a way as to achieve more restrictive regulatory outcomes than either Title I or Title II would allow separately.

This is no “hybrid approach.” It’s a call for FCC double-regulation of the Internet using both Title I and Title II.

This is also no compromise. Effectively it would be the most extreme, maximal regulation yet proposed to the FCC because it would outlaw previously-legal, commercially-reasonable behavior under either Title I or Title II of the Communication Act, while creating maximal regulatory uncertainty and risk.

Why would Rep. Waxman’s FCC Internet utility regulation be found unlawful ultimately?

First, the fatally-flawed tent-pole assumption here, on which this entire contrivance depends, is that the FCC can somehow deem previously mutually-exclusive services under precedent and the law to now be inclusive, i.e. a service that can be both a largely unregulated Title I information service and also a heavily-regulated Title II telecommunications service — at exactly the same time.

Congress created mutually-exclusive definitions for information services and telecommunications services in the 1996 Telecom Act.

The Supreme Court’s Brand X opinion effectively affirmed those mutually-exclusive definitions in 2004.

And the FCC has nine precedents over the last 44 years that decided that basic and enhanced services, or telecommunications and information services, were mutually-exclusive service classifications: 1970198019861998199820022004,  2005,  2007.

Chevron Deference is no rescue here, because while the overall Telecom Act may be ambiguous granting the FCC wide interpretive latitude, there is no ambiguity that telecommunications and information services have always been ruled different mutually-exclusive services.

Second, Congress did not grant the FCC statutory authority to unilaterally combine heretofore mutually-exclusive, congressionally-defined, regulatory classifications, let alone for the purpose of imposing more restrictive regulation than Congress imposed in either Title I or Title II authority, or for the purposes of regulating competitive providers in the 21st century more restrictively than Congress and the FCC regulated the telephone monopoly in the 20thcentury.

This proposal contrives to impose and then forbear from Title II Section 202, which prohibits “unjust and unreasonable discrimination,” so that it can replace it with even more restrictive Title I regulation that would outlaw any discrimination at all, even if it was just and reasonable discrimination, or “commercially reasonable” discrimination, which have long been legal under Title II. Many court precedents have affirmed providers’ freedom to engage in just and reasonable discrimination.

Third, there is nothing in Section 706 that authorizes the FCC to essentially broadly-legislate regulatory restrictions in excess of common carriage obligations under Title II, that are designed in effect, to be economic regulations that create permanent implicit multi-billion dollar subsidies via a permanent zero-price for Silicon Valley sender or downstream traffic.

This is no trivial or technical matter, because the effect of this proposal would be to create a massive national economic subsidy scheme. The FCC would have to force consumers to subsidize Silicon Valley commercial interests and profitability by forcing consumers to pay the full cost of upgrading the Internet’s infrastructure with no fair share contribution from Silicon Valley.

Simply, the D.C. Circuit Court of Appeals ruled that the FCC does not have the authority to ban a two-sided market under its Title I Section 706 authority because that would be tantamount to illegal common carrier regulation of an information services provider, and under Title II the FCC does not have the authority to ban “just and reasonable discrimination” which is what the Waxman proposal is asking for.

More simply, how can combining mutually-exclusive regulations that both individually do not legally allow what the Waxman proposal seeks to achieve, somehow allow it when combined in an obviously contrived, and extremely restrictive, way never envisioned by Congress?

Conclusion

The D.C. Court of Appeals has twice overturned FCC overreach in broadband regulation inComcast v. FCC in 2010 and in Verizon v. FCC in 2014.

In Verizon v. FCC, Judge Tatel outlined a roadmap for the FCC to successfully assert general regulatory authority to cover most, but not all of the FCC’s regulatory needs and concerns. The FCC’s NPRM wisely proposes to follow the Court’s advice. It should follow through with that common sense approach.

However, if the FCC somehow were to adopt the Waxman double-regulation of the Internet approach, there is a high likelihood the courts would eventually overturn the FCC — yet again.

It isn’t a close call.

Implementing the Waxman proposal would be a unilateral de facto FCC Communications Act Update by the FCC – sans Congress.

Lastly, the Waxman proposal is also completely unnecessary, unwarranted, and unjustified double-regulation of competitive broadband providers of critical Internet infrastructure that well serve consumers, businesses, and the economy, and that need commercially-reasonable, regulatory certainty and flexibility to keep up with exploding demand for Internet capacity.

***

FCC Open Internet Order Series

Part 1: The Many Vulnerabilities of an Open Internet [9-24-09]

Part 2: Why FCC proposed net neutrality regs unconstitutional, NPR Online Op-ed [9-24-09]

Part 3: Takeaways from FCC’s Proposed Open Internet Regs [10-22-09]

Part 4: How FCC Regulation Would Change the Internet [10-30-09]

Part 5: Is FCC Declaring ‘Open Season’ on Internet Freedom? [11-17-09]

Part 6: Critical Gaps in FCC’s Proposed Open Internet Regulations [11-30-09]

Part 7: Takeaways from the FCC’s Open Internet Further Inquiry [9-2-10]

Part 8: An FCC “Data-Driven” Double Standard? [10-27-10]

Part 9: Election Takeaways for the FCC [11-3-10]

Part 10: Irony of Little Openness in FCC Open Internet Reg-making [11-19-10]

Part 11: FCC Regulating Internet to Prevent Companies from Regulating Internet [11-22-10]

Part 12: Where is the FCC’s Legitimacy? [11-22-10]

Part 13: Will FCC Preserve or Change the Internet? [12-17-10]

Part 14: FCC Internet Price Regulation & Micro-management? [12-20-10]

Part 15: FCC Open Internet Decision Take-aways [12-21-10]

Part 16: FCC Defines Broadband Service as “BIAS”-ed [12-22-10]

Part 17: Why FCC’s Net Regs Need Administration/Congressional Regulatory Review [1-3-11]

Part 18: Welcome to the FCC-Centric Internet [1-25-11]

Part 19: FCC’s Net Regs in Conflict with President’s Pledges [1-26-11]

Part 20: Will FCC Respect President’s Call for “Least Burdensome” Regulation? [2-3-11]

Part 21: FCC’s In Search of Relevance in 706 Report [5-23-11]

Part 22: The FCC’s public wireless network blocks lawful Internet traffic [6-13-11]

Part 23: Why FCC Net Neutrality Regs Are So Vulnerable [9-8-11]

Part 24: Why Verizon Wins Appeal of FCC’s Net Regs [9-30-11]

Part 25: Supreme Court likely to leash FCC to the law [10-10-12]

Part 26: What Court Data Roaming Decision Means for FCC Open Internet Order [12-4-12]

Part 27: Oops! Crawford’s Model Broadband Nation, Korea, Opposes Net Neutrality [2-26-13]

Part 28: Little Impact on FCC Open Internet Order from SCOTUS Chevron Decision [5-21-13]

Part 29: More Legal Trouble for FCC’s Open Internet Order & Net Neutrality [6-2-13]

Part 30: U.S. Competition Beats EU Regulation in Broadband Race [6-21-13]

Part 31: Defending Google Fiber’s Reasonable Network Management [7-30-13]

Part 32: Capricious Net Neutrality Charges [8-7-13]

Part 33: Why FCC won’t pass Appeals Court’s oral exam [9-2-13]

Part 34: 5 BIG Implications from Court Signals on Net Neutrality – A Special Report [9-13-13]

Part 35: Dial-up Rules for the Broadband Age? My Daily Caller Op-ed Rebutting Marvin Ammori’s [11-6-13]

Part 36: Nattering Net Neutrality Nonsense Over AT&T’s Sponsored Data Offering [1-6-14]

Part 37: Is Net Neutrality Trying to Mutate into an Economic Entitlement? [1-12-14]

Part 38: Why Professor Crawford Has Title II Reclassification All Wrong [1-16-14]

Part 39: Title II Reclassification Would Violate President’s Executive Order [1-22-14]

Part 40: The Narrowing Net Neutrality Dispute [2-24-14]

Part 41: FCC’s Open Internet Order Do-over – Key Going Forward Takeaways [3-5-14]

Part 42: Net Neutrality is about Consumer Benefit not Corporate Welfare for Netflix [3-21-14]

Part 43: The Multi-speed Internet is Getting More Faster Speeds [4-28-14]

Part 44: Reality Check on the Electoral Politics of Net Neutrality [5-2-14]

Part 45: The “Aristechracy” Demands Consumers Subsidize Their Net Neutrality Free Lunch [5-8-14]

Part 46: Read AT&T’s Filing that Totally Debunks Title II Reclassification [5-9-14]

Part 47: Statement on FCC Open Internet NPRM [5-15-14]

Part 48: Net Neutrality Rhetoric: “Believe it or not!” [5-16-14]

Part 49: Top Ten Reasons Broadband Internet is not a Public Utility [5-20-14]

Part 50: Top Ten Reasons to Oppose Broadband Utility Regulation [5-28-14]

Part 51: Google’s Title II Broadband Utility Regulation Risks [6-3-14]

Part 52:  Exposing Netflix’ Biggest Net Neutrality Deceptions [6-5-14]

Part 53: Silicon Valley Naïve on Broadband Regulation (3 min video) [6-15-14]

Part 54: FCC’s Netflix Internet Peering Inquiry – Top Ten Questions [6-17-14]

Part 55: Interconnection is Different for Internet than Railroads or Electricity [6-26-14]

Part 56: Top Ten Failures of FCC Title II Utility Regulation [7-7-14]

Part 57: NetCompetition Statement & Comments on FCC Open Internet Order Remand [7-11-14]

Part 58: MD Rules Uber is a Common Carrier – Will FCC Agree? [8-6-14]

Part 59: Internet Peering Doesn’t Need Fixing – NetComp CommActUpdate Submission [8-11-14]

Part 60: Why is Silicon Valley Rebranding/Redefining Net Neutrality?  [9-2-14]

Part 61: the FCC’s Redefinition of Broadband Competition [9-4-14]

Part 62: NetCompetition Comments to FCC Opposing Title II Utility Regulation of Broadband [9-9-14]

Part 63: De-competition De-competition De-competition [9-14-14]

Part 64: The Forgotten Consumer in the Fast Lane Net Neutrality Debate [9-18-14]

Part 65: FTC Implicitly Urges FCC to Not Reclassify Broadband as a Utility [9-23-14]

Part 66: Evaluating the Title II Rainbow of Proposals for the FCC to Go Nuclear [9-29-14]

[Originally published at Precursor Blog]

Categories: On the Blog

GAO Report Confirms: States Better Fracking Regulators than EPA

October 08, 2014, 10:04 AM

A new report from the Government Accountability Office (GAO) confirms what many small-government environmentalists have been saying for years: States are more effective at regulating the disposal of wastewater from hydraulic fracturing operations than is the Environmental Protection Agency.

Hydraulic fracturing, also known as “fracking,” has led to a surge in oil and natural gas production in the United States. The process uses water, sand, and a few chemical additives to create fissures in oil- and gas-bearing rocks thousands of feet underground, allowing these resources to flow up to the surface.

Each hydraulically fractured well typically requires 2 to 4 million gallons of water, with 15 to 50 percent of this water flowing back to the surface after the process is complete. This water is typically briny, and it contains remnants of the sand and chemical compounds used to fracture the well.

This water must be disposed of or recycled. Disposal typically means injecting the wastewater into deep, underground wells regulated by EPA under the Underground Injection Control (UIC) program. GAO concluded EPA’s injection-well safeguards sufficiently protect drinking water: Few allegations of drinking water contamination, and fewer confirmed cases of groundwater contamination, have been reported.

However, GAO’s report stressed EPA has failed to be proactive regarding emerging challenges, such as induced seismicity (manmade earthquakes) and excessive pressurization of rock formations. GAO urged EPA to update its regulations to reflect state laws.

EPA cannot help enforce state regulations unless they are incorporated into federal rules, which is why GAO is urging EPA to update its rules to reflect the superior wastewater-injection protections adopted by states.

Amazingly, EPA responded by stating, “Incorporating changes into federal regulations, particularly through the rulemaking process, was burdensome and time-consuming.” This is the same EPA that is seeking to expand its authority (and therefore its control over your everyday life) by creating rules to regulate carbon dioxide emissions from power plants and micromanaging prairie potholes and the puddles that form in your driveway after a summer rain. Yet it considers its current duties “too burdensome.”

Claiming protection of the environment is “too burdensome” is not an option for state regulators, which is why they are more effective than federal regulators on these matters.

For example, Ohio passed regulations allowing the state’s chief of the Division of Oil and Gas to require a number of tests or evaluations to address potential induced seismic risks for companies seeking permits for brine injection wells in Ohio.

Other state regulations considered “too burdensome” for EPA adoption include on-site inspection for all injection wells to review the condition and operation of the wells. California, Colorado, and North Dakota require monthly reporting on injection pressure, injection volume, and the type of fluid being injected.

It makes little sense to entrust EPA to handle more responsibility when it has been incapable of fulfilling the responsibilities it already has. This is especially obvious when the responsibility involves essentially copying the example already implemented by state agencies.

EPA claims it does not have the resources to implement this program properly, but EPA’s budget request for 2014 was $8.153 billion, more than the entire annual budgets of 20 percent of states nationwide … yet these states, which have fewer resources at their disposal, manage to get the job done just fine.

It is time to seriously consider replacing EPA with a Committee of the Whole of the 50 state environmental protection agencies, an idea suggested by Jay Lehr, science director and senior fellow at The Heartland Institute, where I serve as research fellow. According to the GAO, we might as well do so, since the states seem to be doing all the heavy lifting already.

Isaac Orr (iorr@heartland.org) is a research fellow for energy and environmental policy at The Heartland Institute.

Categories: On the Blog