This week’s “Daily Journal” guest columnist is Dr. Roy Cordato, Vice President for Research and Resident Scholar at the John Locke Foundation.
Imagine that a commission or study group was formed by the state of North Carolina to consider and evaluate proposals for reforming North Carolina’s business regulations. Furthermore, the state hired consultants to assess the economic impact of the different changes being considered. Now imagine the consulting group was formed by a very conservative out-of-state think tank or advocacy group, known for opposing business regulations – the Cato Institute or the Heritage Foundation. In addition, most of the group’s funding was coming, not from taxpayers, but from four wealthy foundations known for supporting right-wing causes.
What would the reaction be from North Carolina’s editorial writers, left-wing advocacy groups, and think tanks? Certainly there would be outrage and justifiable complaints that “right-wing” money and large, out-of-state right-wing organizations were trying to influence North Carolina’s policy process by infiltrating the work of an official government body.
This is the situation that Carolina Journal reporter Paul Chesser has uncovered in a series of three articles that he recently published on CarolinaJournal.com. The only difference is that the issue is not business regulation but global warming policy, and the advocacy groups and foundations are known for their activities on the political left, not the political right. Not surprisingly, the reaction from North Carolina’s media elite has not been one of outrage or even concern, but deafening silence.
The government study group is the Climate Action Plan Advisory Group (CAPAG), formed by North Carolina’s Division of Air Quality, and the consulting firm is the Center for Climate Strategies (CCS). The Pennsylvania Environment Council, an environmental advocacy group known to take alarmist positions on global warming, founded CCS. CCS is receiving $350,000 for the work that it is doing for CAPAG, and more than two-thirds of this money ($225,000) is coming from four prominent foundations known for funding left-wing causes: $100,000 from the Rockefeller Brothers Foundation (New York); $75,000 from the Z. Smith Reynolds Foundation (North Carolina), the largest contributor to left-wing think tanks and advocacy activities in North Carolina; $30,000 from the Surdna Foundation (New York); and $20,000 from the Marisla Foundation (California). All of these foundations have histories of funding organizations that take an alarmist position on global warming.
DAQ and CAPAG are using a consulting firm that was founded by an environmental advocacy group and that is being paid for by left-wing foundations to provide “objective” analysis of proposals to combat global warming. But it doesn’t stop there. CAPAG is using that analysis to make recommendations to the Legislative Commission on Global Climate Change, whose charge is to assess policies and make recommendations to the General Assembly. The legislative commission is performing no independent analysis of its own and is relying on CAPAG and CCS. Furthermore, CAPAG is not sending out any of the analysis for peer review. This would be easy to do given the extensive expertise in environmental, resource, and energy economics on faculties throughout the UNC system.
Even more problematic is that DAQ and CAPAG have ceded almost total control of the decision-making process over to CCS. While the consulting group does not make final policy recommendations, it does design and provide the list of policy options that CAPAG considers. So the all-important power to determine the range of possibilities has been turned over to CCS. Given CCS’ pedigree, it is not surprising that its approach to framing these options assumes the most extreme and alarmist views on global warming, i.e., that it is caused by humans, will have catastrophic consequences, and could be reversed or altered by the policies that are recommended. In addition to this, CCS runs and controls the agenda and voting process of all CAPAG meetings and the meetings of CAPAG’s “technical working groups.”
The proposals that CCS has presented to CAPAG include a 50-cent per gallon increase in the gasoline tax; higher taxes on electricity; subsidies to interest groups – like the wind and solar power industries – via a renewable portfolio standard; increased subsidies for public transportation; major restrictions on property rights through smart growth land use policies; and a host of other proposals that have been pushed by left-wing environmental groups for decades. Indeed, the set of proposals looks as if it could have come from a position paper published by Environmental Defense or the Sierra Club. In the midst of all this, they have conveniently ignored the uncontested fact that there is nothing North Carolina could reasonably do, even in conjunction with the entire world, which would noticeably impact the climate. Of course, if CCS acknowledged this fact, it would dry the river of left-wing foundation money that is flowing into its coffers.
What CCS is Not Doing
Many, including John Garrou, co-chair of the Legislative Commission on Global Climate Change, claim that CCS is conducting cost/benefit analysis. In fact, this is not the case. Instead, what CCS is doing, at best, is simply “cost analysis.” The consultants are examining and comparing the costs of carbon dioxide reduction proposals that, as noted, they devised in the first place. Most of their analysis does not display knowledge of even basic economics. For example, much of what economists consider to be true opportunity costs are left out of the calculations. They ignore impacts on the poor, unemployment rates, health and safety, Gross State Product, and nearly all other significant variables. But this is not surprising since CCS shows no one with an advanced degree in economics on its published list of analysts.
What is particularly telling about the CCS analysis is that there is no discussion of the actual climate change benefits that will follow if its list of suggestions is adopted. This, at a minimum, is what would have to be done if actual cost/benefit analysis were to be pursued. The fact that CCS is not doing this is a tell-tale sign that their work is motivated by advocacy and not a sense of analytical rigor. The truth, which CCS surely knows but never acknowledges, is that none of its proposals – whether enacted by the state, the nation, or the world – would have any noticeable impact on the climate for the foreseeable future—100 to 200 years. Effectively this means that the higher taxes and new regulations that they are presenting would impose significant costs on North Carolina’s citizens with zero climate change benefits. This is an aspect of the scientific debate that is not in dispute.
For the citizens of North Carolina, the real problem is not with CCS but with the Division of Air Quality and its parent agency, the Department of Environment and Natural Resources (DENR). They are working hand in glove with CCS as participants in this charade. DENR and DAQ apparently have no problem turning over the state’s business to an organization that is being paid for by ideology-driven foundations and, at a minimum, has the appearance of being an advocacy front group. If the state agencies were truly serious about obtaining objective and unbiased analysis, there is a vast amount of relevant expertise in the UNC system that could be employed to carry out real economic analysis. But then there would be the risk that this might not lead to the desired results.