The Pelican Post

Jim Harper of the Cato Institute has posted his analysis of where President Obama currently stands on his pledge to post all legislation online for five full days before signing it into law.  Harper concludes that:

• President Obama has signed 114 bills into law.
• 86 of those bills, or 75%, have been held at the White House for five or more days as a matter of course. Simply posting them on Whitehouse.gov for comment would have fulfilled the president’s pledge.
• Forty-seven bills (41%) have been posted on Whitehouse.gov for five days, but without links leading visitors or search engines to them, so they cannot be counted as fulfillments of the Sunlight Before Signing promise.
• One bill has been posted online for five days, accessible to the public for their review, before receiving the president’s signature: The DTV Delay Act, Public Law 111-4.

Harper notes that a “link on the homepage [of the White House] pointing to bills awaiting the president’s signature” is now available, and predicts that the percentage of bills fulfilling the President’s campaign pledge will greatly increase.

The Pelican Institute applauds the move by the White House to ensure greater transparency and hopes that this trend will continue.

On December 15, 2009, Citigroup and Wells Fargo won approval to begin repaying $45 billion in aid that they received from the Federal Government.  Many view this as a sign that the financial sector in the United States is rebounding, and that the $700 billion Troubled Asset Relief Program (TARP) has been a success.

TARP began as a program designed to purchase toxic assets from troubled banks but quickly morphed into a means of bolstering bank capital levels.  While it is up for debate if that mission has been a success, it ignores a very important underlying question.  What has happened to the “toxic assets” on bank balance sheets that TARP was originally intended to address?

The Congressional Oversight Panel in charge of overseeing TARP stated in its August 2009 report that it “is likely that an overwhelming portion of the troubled assets from last October remain on bank balance sheets today.”

Additionally, a December 2009 report by the same panel argues, “While strong government action helped prevent a worse crisis, it may have done so at a significant long run cost to the performance of our market economy.  Implicit government guarantees pose the most difficult long-term problem to emerge from the crisis.”

The panel warns, “If the troubled assets held by banks prove to be worth less than their balance sheets currently indicate, the banks may be required to raise more capital.”

Basically, the government has spent billions of dollars for purposes other than which it was intended, has not addressed the underlying problem of the financial meltdown, and potentially caused long-term economic damage.

Should banks require more capitol in the future, demand that they do not get it from the government.

On December 7th, 2009, The Environmental Protection Agency announced that greenhouse gases  “threaten the public health and welfare of the American people.”  This ruling came from a 2007 Supreme Court decision in which it was determined that carbon dioxide and other greenhouse gases are pollutants under the Clean Air Act.

The Court stated that the EPA must determine if these gases are a danger to public health and welfare before the agency can regulate them.  A story by the Associated Press noted that the EPA and the White House have said regulations on greenhouse gases will not be imminent even after an endangerment finding, saying that the administration would prefer that Congress act to limit such pollution through an economy-wide cap on carbon dioxide and other greenhouse gases.

However, a story appearing in the National Review counters that, “Congress tells agencies what to do – agencies are not supposed to tell Congress what to do.”  Additionally, the story continues by stating, “Congress needs to make it clear that the EPA has no authority to make climate-change policy.”  In order to facilitate this they call for Congress to pass a law which would prohibit greenhouse gas regulation by the EPA.

The Wall Street Journal’s Kimberley Strassel speculates that the EPA will have to defend its endangerment finding in Court, and therefore “must provide ‘science’ showing that a slightly warmer earth will cause Americans injury or death.”

Additionally, the “tailoring rule” put in place by the EPA seeks to regulate only large carbon emitters. But according to the Clean Air Act, small emitters are supposed to be regulated as well.  Therefore, the EPA is likely to face a surge of lawsuits not only from business groups, but environmental groups who are seeking greater amounts of regulation.

Given the hot political issue that climate change legislation has become, it is increasingly unlikely that Congress will take up the issue during the upcoming election year.  The National Review counters, “If Congress leaves the Clean Air Act as it now stands, it will be construed as granting the EPA authority to regulate almost every facet of our lives.”  Therefore, inaction by Congress is really a tacit endorsement of the EPA’s actions.

Congress must not allow the EPA to set climate change policy.  If the best way to do this is to strip the agency of this power, then that is exactly what must occur.

On December 16th, 2009, the House of Representatives narrowly passed a $174 billion piece of legislation intended to boost employment.  It provides roughly $50 billion for public works projects and another $50 billion for state and local governments.

According to the New York Times, the measure included a “mix of money for highway, transit and water projects and aid to help communities retain teachers and firefighters.”  If this sounds familiar, it is because these are the issues that the $787 billion American Recovery and Reinvestment Act was supposed to address.

Touching on this, Republicans referred to the bill as the “Son of Stimulus,” and commented that, “Even though a mere quarter of the first round of stimulus funds has been spent, Democrats are eager to reach deep into taxpayer pockets again.”  Democrats countered that the $75 billion was paid for with unused funds from the Wall Street bailouts.

This scenario shows a major problem with government borrowing.  The Wall Street bailouts were supposed to be an “extraordinary” circumstance, and the money made from these transactions was to be used to pay down the deficit.  Now, it seems that option has been discarded.

Additionally, it must be asked if the stimulus has worked.  If it has, there should be no need for additional spending to continue its programs, especially since a lot of that money has not yet been spent.  If the stimulus has been a failure, as Republicans have argued, then Congress should not be spending billions to continue failed programs.

Unfortunately, the biggest outcome from this legislation seems clear:  more debt.

The Obama administration intends on implementing a ‘Cap and Trade’ bill by May of 2010 in hopes of curbing the emission of harmful greenhouse gases and reducing pollution. Not only would the legislation fail to effectively reduce emissions it would cost American citizens billions in taxes. Here’s what you need to know about the ‘Cap and Trade’ fallacy:

1) The ‘Cap and Trade’ bill will not reduce any greenhouse gas emissions. In a Washington Post opinion piece, two Environmental Protection Agency attorneys lay out this scenario: “Suppose, for example, that a landowner is paid not to cut his forest so that it can continue capturing carbon dioxide from the atmosphere. Purchasing this offset allows owners of a coal-fired power plant to burn extra coal, above the cap. But if the landowner wasn’t planning to cut his forest, he just received a bonus for doing what he would have done anyway. Even if he was planning to cut his forest and doesn’t, demand for wood isn’t reduced. A different forest will be cut. Either way, there is no net reduction in production of greenhouse gases. The result of this carbon “offset” is not a decrease but an increase — coal burning above the cap at the power plant.”

2) The American taxpayer will be footing the bill, not the polluters. Washington politicians are taking pride in the fact that they are going to make polluters pay. In reality, this is simply not true. The Wall Street Journal Points out, “Once the government creates a scarce new commodity — in this case the right to emit carbon — and then mandates that businesses buy it, the costs would inevitably be passed on to all consumers in the form of higher prices.” Those affected the most are expected to be the “95% of working families” which Obama initially promised would not incur any new taxes. The poor and middle classes currently consume the most, especially on gas to drive to and from work, groceries, and home heating. However, the Obama administration claims that such “price increases are essential to the success of a cap-and-trade program.”

3) The cost of the ‘Cap and Trade’ legislation will be in the trillions. The Obama administration initially estimated that in order to reduce emission levels by 14% of the 2005 level by 2020 it would cost an estimated $13 or $14 per ton of CO2. However, the Congressional Budget Office “scored a similar bill last year, it expected prices to start at $23 and rise to $44 by 2018,” per CO2 ton. The non-partisan CBO projected the total value of the ‘Cap and Trade’ allowance at $902 billion over the first decade alone.

The ‘Cap and Trade’ legislation appears to be yet another on the list of Obama’s broken campaign promises. If the bill is passed it will undoubtedly do more harm than good.