As Good as a Stopped Clock: The House Does Transparency

Yves here. This post illustrates yet another sign of decay among the ruling classes: that of not even bothering to go through the motions of following stipulated political and regulatory processes.

It’s one thing to cut corners now and again and hope you don’t get caught out, and quite another to not even pretend to go through the motions. More and more examples are coming to light: the Snowden revelations have led some Congresscritters to engage in horrified finger-wagging over how the FISA court has served as an enabler of the installation of a massive surveillance state.

But why should they be surprised? The Administration is about to implement a patchwork version of Obamacare to make sure they can say they met the sacrosanct October 1 deadline, with little apparent concern as to how much of a train wreck results. We pointed out the other day how the SEC in its JOBS Act implementation simply ignored the requirement to consider alternative regulatory approaches, even though they were in the record and thus the SEC should have been required to address them. And of course, we have the bizarre classified status of the draft texts of the TransPacific Partnership and EU-US Trade and Investment Partnership negotiations while at the same time big corporations and lobbyists get to read and help write major sections of the drafts. In other words, formalities that were once deemed the heart of proper process are openly ignored in the mad rush to oblige the interests of the financial and business elites.

By Frank Ackerman, Senior economist at Synapse Energy Economics, and a senior research fellow at GDAE at Tufts University. Cross posted from TripleCrisis

One day in May, climate change got a lot more expensive. The price tag on emissions – the value of the damages done by one more ton of CO2 in the air – used to be a mere $25 or so, in today’s dollars, according to an anonymous government task force that met in secret in 2009-2010. Now it’s $40, according to an anonymous government task force that met in secret in early 2013.

Anyone who cares about combating climate change would have to applaud the result: a higher carbon price means that cost-benefit analyses will place a greater value on policies that reduce emissions.

And anyone who cares about democracy should be appalled at the process: are we entering an era in which major regulatory decisions are made anonymously, in secret, with no opportunity for review?

The work of the anonymous task force is a mixture of sophisticated analysis and really bad, arbitrary choices. Three climate-economic models were each applied to five scenarios (derived from other models), and the 15 results were averaged. No persuasive arguments were presented for the controversial choices of models or scenarios; that’s just how the anonymous task force wanted to do it.

Lots of people had comments and criticisms after the first round – and in response, the anonymous task force redux changed nothing whatsoever in its methodology. The increase in the estimated cost of emissions is entirely due to revisions in the three chosen models. Most of this year’s increase in the U.S. government’s social cost of carbon comes from decisions by one modeler, who recently made particularly large changes in his model.

This state of affairs is disturbing to two groups of people: fans of democracy and openness; and climate change deniers and fossil fuel apologists. Guess which group is holding a hearing on the subject on Capitol Hill.

A bipartisan bill, introduced in the House by Representatives Duncan Hunter (R-science denial) and Nick Rahall (D-coal industry), calls for an opportunity for extensive public comment on the benefits (but not the costs) of any proposed regulation before it is adopted. The very brief text of the bill shows no great familiarity with regulatory language or procedures, but singles out any process involving the phrase “social cost of carbon” as particularly in need of review.

We do need better review of key regulatory decisions, but this bill isn’t even a useful first draft of appropriate, impartial procedures. No surprise: that’s not what it was designed for.

Like a stopped clock that tells the correct time twice a day, members of Congress who are sure that the Obama administration, the EPA, and climate policy are wrong, wrong, wrong will occasionally look like they are onto something. But the clock will continue ticking, and the moment will pass: the House will soon return to its core competencies of voting against Obamacare and taking food away from hungry children.

Someday, somehow, the rest of us will have to figure out how to achieve real regulatory transparency and openness. The system actually is broken, even if we happen to like the direction of change in the latest decision of the anonymous task force.

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11 comments

  1. C-tax-is-BS

    Carbon tax was invented by Banksters and Corruptician’s to monetise the air we breath, but disguised as a “Green Benefit”.

  2. mookie

    …formalities that were once deemed the heart of proper process are openly ignored in the mad rush to oblige the interests of the financial and business elites.
    – yves

    …and anyone who cares about democracy should be appalled at the process: are we entering an era in which major regulatory decisions are made anonymously, in secret, with no opportunity for review? –
    ackerman

    hear, hear

  3. Susan the other

    The social (city smog and health concerns) cost of carbon would plummet if we stopped using fossil fueled cars and coal fueled electricity. Problem here (as per IEEE and others) is that coal fueled electricity is currently required to make batteries for electric cars and the batteries themselves are highly toxic in terms of eventual recycling, but more importantly they continue to use coal fueled electricity to recharge. Coal is the dirtiest, most environmentally destructive fuel of all the carbons. Decisions have clearly been made to stop using coal. The logical expectation then is that we also stop using cars. The brave new industry for the 21 century should be efficient public transportation.

  4. The Infamous Oregon Lawhnobbit

    Decay among the ruling classes … that would be the same as decadence in the aristocracy, n’est ce pas?

    Sounds better in the original French, I’m sure. :)

    1. Nathanael

      Yep. The question then is what will force the elite to go to the people as Louis XVI was forced to call the Estates General.

      I think, nothing. We had better therefore look to Russia in the 1910s for parallels.

  5. nonclassical

    ..simple answer to all messes within “the people’s representative government”..

    German energy commissioner, when asked how Germany could advance solar power in two years, what was forecast to take 20 replied, “Germany holds publicly financed elections”…

    (no campaign “contributions”=special interest influences allowed)

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