Topic: Energy and Environment

Supreme Court Should Tell Courts to Stay Out of Global Warming Cases

The Supreme Court is finally starting to put some interesting non-First Amendment cases on this term’s docket.

Today, the Court agreed to review American Electric Power Co., Inc. v. Connecticut, in which eight states, some non-profits, and New York City are suing a number of energy companies and utilities for harms they allegedly caused by contributing to global warming.  This is the third major lawsuit to push global warming into the courts (another being Comer v. Murphy Oil USA, in which Cato also filed a brief).  It’s America, after all, where we sue to solve our problems – even apparently, taking to court the proverbial butterfly that caused a tsunami.

Mind you, you can sue your neighbor for leaking toxic water onto your land. Courts are well positioned to adjudicate such disputes because they involve only two parties and have limited (if any) effects on others. But it is a different case when, using the same legal theory by which Jones sues Smith for his toxic dumping (called “nuisance”), plaintiffs selectively sue a few targeted defendants for a (quite literally) global problem.  As I discussed with reference to a previous such case, global warming is the type of issue that should be decided by the political branches. The Second Circuit ruled, however, that this suit could go forward. (Justice Sotomayor was involved in the case at that stage and so will be recused going forward.)  

The Supreme Court has always recognized that not all problems can or should be solved in the courtroom. Thus, the issue in AEP v. Connecticut – which the Court will now decide – is whether the states meet the legal requirements necessary to have their suit heard in court, what lawyers call “standing.” Historically, issues of policy have been decided by the legislative and executive branches while “cases and controversies” have been decided by courts. Therefore, when litigants have asked courts determine matters of broad-ranging policy, the Court has often termed the cases “political questions” and dismissed them. The reasoning is that, not only do unelected courts lack the political authority to determine such questions, they also lack any meaningful standards by which the case could be decided (called “justiciability”).

Indeed, even if the plaintiffs can demonstrate causation, it is unconstitutional for courts to make complex policy decisions — and this is true regardless of the science regarding global warming. Just as it’s unconstitutional for a legislature to pass a statute punishing a particular person (bill of attainder), it’s unconstitutional — under the “political question doctrine” — for courts to determine wide-ranging policies in which numerous considerations must be weighed against each other in anything but a bilateral way.  

We pointed out in our brief supporting the defendants’ request for Supreme Court review – and will again in the brief we plan to file at this next stage – that resolving this case while avoiding those comprehensive and far-reaching implications is impossible and that the Constitution prohibits the judicial usurpation of roles assigned to the other, co-equal branches of government.   After all, global warming is a global problem purportedly caused by innumerable actors, ranging from cows to Camrys. This fact not only underscores the political nature of the question, but it has constitutional significance: In order to sue someone, your injury must be “fairly traceable” to the defendant’s actions. Suits based on “butterfly effect” reasoning should not be allowed to move forward.

Perhaps surprisingly, the federal government –which is involved because one of the defendants is the Tennessee Valley Authority – agrees with Cato . The administration aptly played its role in our constitutional system by asserting that global warming policy was a matter for the executive and legislative branches to resolve, not the judiciary. 

Hmmm, Cato and Obama on the same side in a global warming dispute… but I still won’t be holding my breath awaiting an invite to the White House Christmas party.

Slow Death for High-Speed Rail

Tea party victories in November likely signal the beginning of the end for President Obama’s ambitious and expensive high-speed rail plans. Republican governors-elect of both Ohio and Wisconsin have vowed to return federal high-speed rail funds that had been granted to those states. The governor-elect of Florida is also a rail skeptic, and more and more obstacles are being thrown in front of California’s rail plans.


Obama Replaces Costly High-Speed Rail Plan With High-Speed Bus Plan

The prospects for high-speed rail are so dire that the Onion recently suggested that President Obama would shift his support to high-speed buses instead. Even the Washington Post has sounded caution about spending much more money on this obsolete form of travel.

The California High Speed Rail Authority, which wants to spend a mere $43 billion on the first leg of a proposed 220-mph rail network, has gained a reputation as a paragon of mismanagement and conflicts of interest. The authority’s chair, Anaheim Mayor Curt Pringle, has accused its staff of incompetence. Reports from the state auditor, the University of California Institute for Transportation Studies, and a committee of transportation professionals have all concluded that the authority’s cost projections are too low and its ridership revenue projections too high.

Nevertheless, in a blatant political move, the Obama administration gave the authority a $900 million grant just a week before the election on the condition that most of the money be spent in the district of a Democratic member of Congress who was fighting a close reelection campaign. The representative, Jim Costa, won reelection by a mere 3,000 votes. The rail authority dutifully decided to start building the rail line in the heart of Costa’s district, from the small town of Corcoran – known mainly as the home of Charles Manson and fellow prisoners – to an even smaller spot named Borden – population zero. This plan was quickly dubbed the train to nowhere and generated opposition not just from Republicans but from Costa’s fellow Democrat, Dennis Cardoza, who represents the congressional district just north of Costa’s.

Although California voters approved $9 billion in bonds for the rail project, the approval was conditional on getting matching funds. So far, the state has received only about $2 billion from the federal government, which means it only has about $4 billion to spend on construction – less than 10 percent of the amount needed to build from Los Angeles to San Francisco. Given the improbability of finding the other 90 percent, and the fact that Republicans in Congress hope to take back some of the money that has already been granted for high-speed rail, the California rail project seems all but dead. The authority’s only hope is to spend enough money building a train to nowhere that politicians will feel compelled to fund the rest.

Meanwhile, Florida was elated when the Obama administration funded half the cost of an 168-mph line running the 80 miles from Tampa to Orlando, with the promise of more funding later. But the state’s enthusiasm was greatly diminished when the administration announced that it expected the states to come up with at least 20 percent matching funds–funds Florida does not have. Even Orlando Congressman John Mica (likely the next chair of the House Transportation and Infrastructure Committee) has backed away from supporting the line. So the state’s new governor might be able to kill the project.

The Ohio and Wisconsin projects aren’t even worthy of being called high-speed rail, as Wisconsin’s average speed was projected to be just 59 mph and Ohio’s an even more lethargic 38.5 mph. Yet the Wisconsin project was going to cost nearly $1 billion, nearly all of which the feds agreed to fund, while Ohio’s would be more than half a billion, about $400 million of which was initially funded by the feds. Secretary of Immobility Transportation Ray LaHood vowed that these lines would be built no matter what the incoming governors said, then said that if they cancelled the projects, he would just give the money to other states. While that seems likely, Congress could override such a transfer.

Meanwhile, in a spectacular display of poor timing, Amtrak announced its own Boston-to-Washington high-speed rail plan just a week before the election. Current Amtrak trains reach top speeds of 130-150 mph but average only 80 mph on this route. For a mere $117 billion, Amtrak proposed to build a brand-new line capable of reaching 220-mph top speeds, meaning average speeds of about 130-140 mph. But Amtrak planners must have forgotten to low-ball their cost estimates, for the proposed cost-per-mile of $274 million was nearly three times the projected cost of the California line and more than 10 times the projected cost of Florida high-speed rail. No doubt Amtrak will shelve its plan in anticipation of a more favorable political environment.

New transportation technologies are successful when they are faster, more convenient, and less expensive than the technologies they replace. High-speed rail is slower than flying, less convenient than driving, and at least five times more expensive than either one. It is only feasible with heavy taxpayer subsidies and even then it will only serve a tiny portion of the nation’s population.

A few months before the election, LaHood estimated the administration’s high-speed rail construction plans would eventually cost taxpayers $500 billion, and that’s not counting operating subsidies. BNSF CEO Mark Rose thinks the cost will be closer to $1 trillion. If nothing else, the tea parties may be able to take credit for saving taxpayers at least that amount of money.

The Shocking Truth: The Scientific American Poll on Climate Change

November’s Scientific American features a profile of Georgia Tech atmospheric scientist Judith Curry,  who has committed the mortal sin of  reaching out to other scientists who hypothesize that global warming isn’t the disaster it’s been cracked up to be.  I have personal experience with this, as she invited me to give a research seminar in Tech’s prestigious School of Earth and Atmospheric Sciences in 2008.  My lecture summarizing the reasons for doubting the apocalyptic synthesis of climate change was well-received by an overflow crowd.

Written by Michael Lemonick, who hails from the shrill blog Climate Central, the article isn’t devoid of the usual swipes, calling her a “heretic„ which is hardly at all true.  She’s simply another hardworking scientist who lets the data take her wherever it must, even if that leads her to question some of our more alarmist colleagues. 

But, as a make-up call for calling attention to Curry, Scientific American has run a poll of its readers on climate change.  Remember that SciAm has been shilling for the climate apocalypse for years, publishing a particularly vicious series of attacks on Denmark’s Bjorn Lomborg’s Skeptical Environmentalist.  The magazine also featured NASA’s James Hansen and his outlandish claims on sea-level rise. Hansen has stated, under oath in a deposition, that a twenty foot rise is quite possible within the next 89 years; oddly, he has failed to note that in 1988 he predicted that the West Side Highway in Manhattan would go permanently under water in twenty years.

SciAm probably expected a lot of people would agree with the key statement in their poll that the United Nations’ Intergovernmental Panel on Climate Change (IPCC) is “an effective group of government representatives and other experts.”

Hardly. As of this morning, only 16% of the 6655 respondents agreed.  84%—that is not a typo—described the IPCC as “a corrupt organization, prone to groupthink, with a political agenda.” 

The poll also asks “What should we do about climate change?” 69% say “nothing, we are powerless to stop it.” When asked about policy options, an astonishingly low 7% support cap-and-trade, which passed the U.S. House of Representatives in June, 2009, and cost approximately two dozen congressmen their seats.

The real killer is question “What is causing climate change?” For this one, multiple answers are allowed.  26% said greenhouse gases from human activity, 32% solar variation, and 78% “natural processes.” (In reality all three are causes of climate change.)

And finally, “How much would you be willing to pay to forestall the risk of catastrophic climate change?”  80% of the respondents said “nothing.”

Remember that this comes from what is hardly a random sample.  Scientific American is a reliably statist publication and therefore appeals to a readership that is skewed to the left of the political center.  This poll demonstrates that virtually everyone now acknowledges that the UN has corrupted climate science, that climate change is impossible to stop, and that futile attempts like cap-and-trade do nothing but waste money and burn political capital, things that Cato’s scholars have been saying for years.

VIDEO: Joe Biden’s Weak Case for Government Meddling

Vice President Joe Biden believes that human progress depends almost entirely on government vision and government incentive. Donald J. Boudreaux, Cato Institute adjunct scholar and George Mason University economics professor, details why Biden is wrong both generally and in the specific case he touts:



Produced by Caleb O. Brown. Shot and edited by Evan Banks.

Post-Election Outlook: Agriculture Edition

My colleagues have done a thorough job of analyzing the policy implications of Tuesday’s federal election outcome as it affects trade policy, health care, immigration, education, and the scope and size of government generally (more here on federal spending). Most of them are cautiously optimistic that a Republican-controlled House is good news for liberty-minded folk. Let’s hope so.

Unfortunately, there are fewer obvious reasons for optimism that Tuesday’s result will mean big changes in agricultural policy, a depressingly bipartisan area of federal intervention. Even Rand Paul, the poster child for the Tea Party, expressed “moderate” views on farm subsidies during his campaign.

On the positive side of the ledger, our friends at the Environmental Working Group make the excellent point that being a friend of Big Farming was not enough to shield many Democrats from defeat. Earl Pomeroy (D, ND) represents the congressional district that ranks Number One in farm subsidy receipts (now there’s a source of pride!) and even he got the boot. As did Senator Blanche Lincoln, chairperson of the Senate Agriculture Committee and shameless architect of a bailout package for farmers that was funded we-don’t-exactly-know-how. At least 15 (possibly 16 if Rep. Jim Costa (D., CA) loses his too-close-to-call race) Dem members of the House Agriculture Committee — friends of the farmer all — are now looking for work. In other words, support for Big Ag is not a sufficient shield.

On the other hand, it’s not clear that their replacements are an improvement as far as agriculture policy is concerned. With a new farm bill due to be written in 2012 (although soon-to-be-former House Agriculture Committee chairman Collin Peterson (D., MN) was trying to get that ball rolling earlier), it is not certain that the fiscal conservatism exhibited during most Republicans’ campaigns extends to farm policy. Indeed, probable new House Agriculture Committee chairman Frank Lucas (R., OK) has said he disagrees with getting rid of the fiscally offensive (but less trade-distorting) direct payments that flow to farmers regardless of what, or even whether, they farm.  That was an area of reform that Collin Peterson was at least willing to look at. (More on the implications for direct payments here).

Chuck Abbott, agriculture reporter for Reuters, has more analysis on the outlook for farm policy. His is a more optimistic take, and I hope he’s correct. For my part, my skepticism is based on statements such as those by the CEO of the Renewable Fuels Association, speaking on a conference call yesterday:

[F]or the most part those that may have been defeated were replaced with equally strong advocates for value added agriculture and ethanol. Does anyone believe that Kristy Noem (R-SD) will not be a strong voice for ethanol?

Exactly. The fight’s not over yet, folks.

Ballot Initiatives Provide Underappreciated Election-Night Victories

Last week, I highlighted nine ballot initiatives that were worth watching because of their policy implications and/or their role is showing whether voters wanted more or less freedom. The results, by and large, are very encouraging. Let’s take a look at the results of those nine votes, as well as a few additional key initiatives.

1. The big spenders wanted to impose an income tax in the state of Washington, and they even had support from too-rich-to-care Bill Gates. The good news is that this initiative got slaughtered by a nearly two-to-one margin.  I was worried about this initiative since crazy  Oregon voters approved higher tax rates earlier this year. In a further bit of good news, Washington voters also approved a supermajority requirement for tax increases by a similar margin.

2. Nevada voters had a chance to vote on eminent domain abuse. This is an initiative that I mischaracterized in my original post. The language made it sound like it was designed to protect private property, but it actually was proposed by the political elite to weaken a property rights initiative that the voters previously had imposed. Fortunately, Nevada voters did not share my naiveté and the effort to weaken eminent domain protections was decisively rejected.  This is important, of course, because of the Supreme Court’s reprehensible Kelo decision.

3. California voters were predictably disappointing. They rejected the initiative to legalize marijuana, thus missing an opportunity to adopt a more sensible approach to victimless crimes. The crazy voters from the Golden State also kept in place a suicidal global warming scheme that is driving jobs out of the state. The only silver lining in California’s dark cloud is that voters did approve a supermajority requirement for certain revenue increases.

4. Nearly 90 percent of voters in Kansas approved an initiative to remove any ambiguity about whether individuals have the right to keep and bear arms. Let that be a warning to those imperialist Canadians, just in case they’re plotting an invasion.

5. Arizona voters had a chance to give their opinion on Obamacare. Not surprisingly, they were not big fans, with more than 55 percent of them supporting an initiative in favor of individual choice in health care. A similar initiative was approved by an even greater margin in Oklahoma. Shifting back to Arizona, voters also strongly rejected racial and sexual discrimination by government, but they narrowly failed to approve medical marijuana.

6. Shifting to the local level, San Francisco, one of the craziest cities in America rejected a proposal to require bureaucrats to make meaningful contributions to support their bloated pension and health benefits. On the other hand, voters did approve a proposal to ban people from sleeping on sidewalks. Who knew that was a big issue?

7. Sticking with the ever-amusing Golden State, voters unfortunately eliminated the requirement for a two-thirds vote in the legislature to approve a budget, thus making it even easier for politicians to increase the burden of government spending. The state almost certainly is already on a path to bankruptcy, and this result will probably hasten its fiscal demise. Hopefully, the new GOP majority in the House of Representatives will say no when soon-to-be Governor Brown comes asking for a bailout.

8. The entire political establishment in Massachusetts was united in its opposition to an initiative to to roll back the sales tax from 6.25 percent to 3 percent, and they were sucessful. But 43 percent of voters approved, so maybe there’s some tiny sliver of hope for the Bay State.

9. Louisiana voters approved an initiative to require a two-thirds vote to approve any expansion of taxpayer-financed benefits for government employees. With 65 percent of voters saying yes to this proposal, this is a good sign that the bureaucrat gravy train may finally be slowing down.

At the risk of giving a grade, I think voters generally did a good job when asked to directly make decisions. I give them a solid B.

Yglesias on High-Speed Rail

On November 1, the Washington Post published a devastating critique of high-speed rail written by journalist Robert Samuelson. In fewer than 800 words, Samuelson blows up just about all the arguments put forth in favor of rail. An 8-word summary: costs are too high and benefits too low.

One person who remains unconvinced is Matthew Yglesias, who dismisses most of Samuelson’s arguments because some of them resemble the work of a “car-subsidy shill,” namely me. Apparently, if you believe, as I do, that all modes of transportation should be paid for by users, and not by tax subsidies, then you, too, are a “car-subsidy shill.”

Yglesias did not even read Samuelson’s article, instead reading only a Cato-at-Liberty blog post by Tad DeHaven about that article. But after a mere three or four paragraphs of analysis, Yglesias somehow concludes that $1 trillion for high-speed rail is “a bargain.” His analysis, such as it is, comes down to two points. First, Randal O’Toole opposes high-speed rail, so therefore it must be a good thing. Second (pulling out his mortgage calculator), at 4.1 percent interest over 30 years, $1 trillion is really “only” $58 billion per year. “Let’s do it!” he concludes.

I’ve never met Yglesias, so he probably doesn’t know that I personally love trains and hate driving. But as an policy analyst, I have to put my personal preferences aside and ask a couple of questions that never seem to occur to Yglesias. First, what are the benefits? Second, what do you have to give up to pay the costs?

The answer to the first question is: negligible. High-speed trains will carry less than 10 percent of the number of passenger miles carried by the Interstate Highway System (all the cost of which was paid out of user fees), and virtually no freight (interstate highways not only carry 20 percent of all passenger miles but about 15 percent of all freight ton-miles in the United States).

The history of transportation shows that new technologies succeed when they are faster, more convenient, and less expensive than existing technologies. High-speed rail is slower than flying, less convenient than driving, and (based on Amtrak’s Acela) at least five times more expensive than either. That means, as Samuelson says, “High-speed rail would subsidize a tiny group of travelers and do little else.”

Moreover, really successful new transportation technologies significantly increase mobility. Yet Florida predicts that only 4 percent (see p. 13) of the riders on its 168-mph trains would be new mobility. California’s 220-mph trains would create even less new mobility: the California High-Speed Rail Authority’s latest estimate predicts that less than 1 percent (see p. 9) of its ridership would be new mobility. Here’s an arithmetic lesson for Yglesias: something that creates almost no new mobility, and merely substitutes high-cost transportation for a few marginal travelers previously using low-cost modes, is not a good deal.

Nor is high-speed rail the environmental answer to anything. The environmental costs of construction are high, while the environmental benefits of operations are low, leading Florida to conclude in its environmental impact statement that “the environmentally preferred alternative is the no build alternative” (see p. 2-38). In fact, both cars and airplanes are becoming more energy efficient so rapidly that, by the time a national high-speed rail system could be built, rail would be the brown form of passenger travel.

On the cost side, Yglesias only asks whether my $1 trillion estimate, which is “based on the costs estimates of the California system,” is valid considering that “California is an above-average cost jurisdiction.” That’s a legitimate question that would have been answered if he had bothered to read the footnoted reference. (I divided routes into low-cost and high-cost lines and used different estimates for each.)

Samuelson’s cost estimate was only $200 billion, but that was for high-speed rail in California and Florida and moderate-speed rail (90- to 110-mph) everywhere else. The $1 trillion is for a true national network of high-speed (150-220-mph) rail. I was not the first to use a $1 trillion estimate; that was Matt Rose, the CEO of the BNSF Railway, who probably knows a little more about rail costs than either Yglesias or me.

Beyond that, how could anyone conclude that $58 billion per year is a low price for anything, especially in today’s economy? Where is this money going to come from? Not the states, most of which are financially strapped. Perhaps we could cut all other federal spending on surface transportation–but that was only $54 billion in 2009. I know: let’s pass a health care law that will save money. But we already did that, and now federal health-care costs are projected to rise by, coincidentally, $58 billion between 2009 and 2011. Darn–there goes the money for high-speed rail. (All these numbers are from page 69 of the 2011 federal budget historical tables.)

High-speed rail riders aren’t going to pay $59 billion per year–they won’t even pay the operating costs of high-speed rail on most routes, which Yglesias managed to ignore. Amtrak claims its Acela trains earn a profit (not counting capital costs), but the Acela shares a lot of its operating costs with other Boston-to-Washington trains, which lose money. Between the two of them, they barely broke even in 2009 (see p. C-1). No other high-speed rail route in this country is likely to do as well.

By the way, in order to break even on Boston-to-Washington trains, Amtrak charged Acela riders 72 cents per passenger mile. That’s more than five times the average fares charged by airlines and intercity bus companies. Fares on Amtrak’s low-speed trains are only twice air and bus fares, which I am sure Yglesias thinks is a bargain.

I don’t know why Matt Yglesias thinks spending $1 trillion on trains that only a few people will ride would be a bargain. But I have no doubt that high-speed rail would be a high-cost burden on taxpayers.