EPA carbon ruling creates an even bigger ‘uncertainty tax’ for business

December 7, 2009

Call it the Uncertainty Tax. I mean, it is not enough that the American private sector has to deal with the mercurial state of healthcare, financial and tax reform, now it has to calculate the likelihood and impact of  the Obama administration unilaterally imposing draconian carbon rules? Even the EPA calls such efforts inefficient and economically disruptive. A few other thoughts:

1) Expect loads of litigation.

2) Don’t expect this to nudge Congress into passing cap-and-trade in 2010.

3)  Did I mention loads of litigation?

4)  It this looks likely, Congress would probably strip the EPA of its authority to do so.

5)  If Congress does not act, this could be the beginning of a multi-year effort  to regulate climate emissions. So more uncertainty.

James Pethokoukis is the money and politics columnist/blogger for Reuters Breakingviews. Previously, he was the economics columnist for U.S. News & World Report where he wrote the monthly Capital Commerce magazine column. Pethokoukis was also the managing editor of the magazine’s Money & Business section. He has written for many publications including the New York Times, the American, USA Today, Investor’s Business Daily, and TCS Daily. Pethokoukis is also an official CNBC contributor and appears frequently on that network’s Kudlow & Company, Power Lunch, and The Call shows. In addition, he has appeared numerous times on MSNBC, Fox News Channel, Fox Business Network, CNN, and Nightly Business Report on PBS. A 1989 graduate of Northwestern University where he double majored in Soviet politics and American history and a 1991 graduate of the Medill School of Journalism, Pethokoukis is a 2002 Jeopardy! champion.james.pethokoukis@thomsonreuters.com

3 comments

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I just don’t understand how people continue to trust politicians. When has a government program ever proven to be an impressive success. We need to elect politicians who understand that government does best when it does least. If we cut ALL programs by 90% over the next 10 years and dropped tax rates to 5%, the economy would surge tremendously and this would once again become the land of opportunity. Now it’s becoming the land of listlessness. Stop punishing ambition.

James has posted several times on the significant dampening effect on small business that the uncertainty over healthcare and cap and trade and possible new EPA rules have. And it is absolutely true that business owners are just not willing to hire employees and commit capital under this utterly bizarre and chaotic political climate.

But, I don’t think enough attention is being paid to how the government caused stress and uncertainty is also affecting and stifling consumers— and therefore their necessary part in our economic recovery . (If I buy a new car will I find out next year that the EPA milage requirements have changed? Will I have to spend more for my family’s health insurance policy than I currently do, and will it still cover the same things? How much extra will I need to sock away for increased home heating fuel and electricity? Will I still have a job a year from now? What new taxes are they going to come up with? etc., etc,) It’s as though things are at a standstill as America holds its breath, fearfully holds onto what it still has, and waits for the next shoe to drop. Talk about Malaise!

Posted by Elizabeth | Report as abusive

The Obama administration is perhaps most remarkable for how it has emboldened the rest of the extreme left. Pelosi and Reid attempt to shove through outrageously dangerous legislation knowing that the anti-American, anti-business president will eagerly sign it. The spokewoman for the EPA could barely mask her glee that this unelected group would soon be forcing draconian regulations on industry and homeowners.

Since the release of the climategate emails the left has confirmed that they are unconcerned with facts or consequences. They march on unashamed with their plan to halt progress and punish success.

Posted by Pat Duggan | Report as abusive