Tag Archives: budget

The Itsy Bitsy Ambitions of John Boehner

Mother Jones

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You can’t accuse John Boehner of starry-eyed idealism:

When I ask him to name his top priority, he lays out not a grand legislative bargain but a seemingly modest managerial goal that has eluded him for much of his time at the top: exercising enough control over his conference to pass spending bills through regular order.

Um, OK. That seems doable. But I’m not so sure about this:

The idea of a Boehner-Obama bargain late in the game is no idle fantasy….Boehner told me “bipartisanship” was in fact one of his top priorities for 2015, and, in private, in the wake of the 2013 shutdown debacle, Boehner told his inner circle that he has no problems passing big legislation “by working directly with the Democrats” if his own conference defies him again.

….That’s the way it worked in December: Two-thirds of Republicans joined about one-third of Democrats to pass a Boehner government-funding plan….When I asked Boehner if he worried Republicans would slam him for dealing with Democrats, he blew a puff of smoke and answered, “I don’t care.”

It’s true that during the recent lame-duck session, Boehner was willing to pass a compromise budget that alienated much of his own caucus and required lots of help from Democrats to pass. But will he be willing to do that when it comes to a “big deal on taxes, entitlements and government spending, trade and immigration”? I have my doubts, no matter how much we hear that Boehner and Obama are really tighter buddies than you’d think. It’s not just that Boehner really, truly has to be willing to defy a big chunk of his caucus, after all. He also has to be willing to take the risk of making genuine compromises in order to get a sizeable chunk of Democrats on board. Outside of budget deals, I’ve simply seen no evidence that Boehner is willing to do that—or, even if he is, that he has the mojo within his own caucus to get most of them to agree to such a deal.

But we’ll see. Maybe Boehner will surprise us. I just wouldn’t bet the farm on it.

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The Itsy Bitsy Ambitions of John Boehner

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Mitch McConnell Wants to Open a Giant Loophole for Superrich Donors. Harry Reid Has Vowed to Stop Him.

Mother Jones

Senate Majority Leader Harry Reid (D-Nev.) is vowing to block any effort by his GOP counterpart, Mitch McConnell, to loosen the nation’s campaign finance limits as part of a bipartisan budget deal taking shape in Congress.

Last week, the Huffington Post reported that McConnell, who will take over as majority leader in January, wanted to slip into a major government funding bill a measure that would give presidential and congressional candidates more leeway to coordinate their campaign spending with political parties. Right now, candidates for federal office can coordinate some of their election spending with the parties—but only up to a certain amount. (The limit ranges from tens of thousands to several million dollars, depending on the size of the state’s voting-age population.) Beyond that threshold, parties and candidates can’t coordinate their spending plans, and the parties must spend their funds independently of the candidates they back.

The existing rule is intended to prevent donors from using political parties to skirt legal limits on donations to candidates. As it stands, donors can give up to $5,200 every two-year election cycle to each candidate for federal office. But McConnell’s measure, if enacted, would create a massive loophole in that rule, says Fred Wertheimer of Democracy 21, a group that supports limits on money in politics. If McConnell gets what he wants, rich donors who hit the $5,200 limit could simply route further donations to candidates by giving to political party committees—which may accept far larger donations and could work directly with the candidates to ensure the money was spent as the donors intended. “The practical effort here is to repeal the limits,” Wertheimer says.

McConnell has a broader plan here. Politico recently noted that McConnell is seeking to direct more big money to political parties, as opposed to outside groups such as super-PACs that in theory must remain independent of candidates. In a subsequent interview with Roll Call, McConnell suggested he might not force the issue, saying his proposal is “not on the agenda” but that the coordination limit he wants to eliminate is “an absurdity in the current law.”

That doesn’t mean the plan is dead. Should McConnell reverse course and attach this change to the budget bill, Reid’s office says the majority leader will block such a maneuver. “Reid strongly opposes and will fight against any efforts to include the McConnell measure,” an aide in Reid’s tells Mother Jones.

House and Senate members hashing out the budget bill were expected to release a version of the legislation as early as Monday evening.

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Mitch McConnell Wants to Open a Giant Loophole for Superrich Donors. Harry Reid Has Vowed to Stop Him.

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Obama’s Immigration Order: Lots of Sound and Fury, But Not Much Precedent

Mother Jones

In the New Republic this weekend, Eric Posner warns that President Obama’s recent executive action on immigration may come back to haunt liberals. Obama’s order was perfectly legal, he says, but “it may modify political norms that control what the president can do.” And since most of the regulatory apparatus of the government is fundamentally liberal in nature, a political norm that allows presidents to suspend enforcement of rules they don’t like benefits conservatives a lot more than it does liberals.

This is not something to be taken lightly, and Posner makes his point pretty reasonably—unlike a lot of conservatives who have been busily writing gleeful, half-witted columns about suspending the estate tax or dismantling the EPA. Political norms matter, as Republicans know very well, since they’ve smashed so many of them in recent years. Still, there are a couple of reasons that there’s probably less here than meets the eye, and Posner acknowledges them himself.

First, although the core of Obama’s authority to modify immigration law lies in his inherent power to practice prosecutorial discretion—which is rooted in the Constitution—the specific actions he took are justified by statutory language and congressional budgeting priorities that are unique to immigration law. As conservative lawyer Margaret Stock reminds us, “The Immigration and Nationality Act and other laws are chock-full of huge grants of statutory authority to the president.” And Posner himself agrees. “The president’s authority over this arena is even greater than his authority over other areas of the law.” He reiterates this in his TNR piece, explaining that immigration law “falls uniquely under executive authority, as a matter of history and tradition.”

So Obama’s actions may be unusually broad, but that’s largely because immigration law is written to give the president considerable latitude. That’s much less the case for things like the tax code or the Clean Air Act. So even though it’s true, as Posner says, that most regulatory statutes “contain pockets of vagueness,” there’s less precedent here than it seems, and less breaking of political norms than Posner imagines.

But there’s a second reason that Obama isn’t seriously breaking any political norms: they were already broken years ago. Posner himself tells the story:

In 1981, Ronald Reagan entered the presidency vowing to deregulate the economy. But because the House was controlled by Democrats, Reagan could not persuade Congress to repeal as many regulatory statutes as he wanted to.

So Reagan sought to undermine the regulatory system itself. He forced agencies to show proposed regulations to the Office of Management and Budget, a White House agency, and empowered the OMB to block or delay regulations that did not satisfy a cost-benefit test. Although OMB was told to obey the law, liberals howled that the effect of the cost-benefit test was to undercut regulation since no such test existed in the statutes under which agencies issued regulations. And when the Reagan administration could not change or repeal the rules, it cut back on enforcement. The Justice Department famously reduced enforcement of the antitrust and civil rights laws. More howls ensued.

But the Reagan administration exhausted itself fighting against political distrust of an imperial executive and overreached by trying to deregulate in areas—like the environment—that people cared about. Republican successors—the two Bushes—did not pursue deregulation through non-enforcement with such zeal. Obama’s deferral actions, by further normalizing non-enforcement, may reinvigorate the Reagan-era push for deregulation through the executive branch.

It’s become traditional that when a new president takes office he immediately suspends any of his predecessor’s executive actions that have been recently implemented. At the same time, his own team begins beavering away on regulatory changes that are part of his campaign agenda. At a different level, orders are written that make it either easier or harder for agencies to implement new rules and enforce old ones. And while Reagan may not have gotten all the deregulation he wanted, the OMB has become a permanent part of the regulatory landscape, which is yet another avenue for presidents to affect the enforcement of rules. It may not get a lot of attention, but when you fiddle with the cost-benefit parameters that OMB uses, the ripple effect can be surprisingly extensive.

In other words, agency regulations and executive orders are already major battlegrounds of public policy that are aggressively managed by the White House, regardless of which party is in power. Has Obama expanded this battleground? Perhaps. But I don’t think the change is nearly as great as some people are making it out to be. Immigration law is fairly unique in its grant of power to the executive, so we don’t really have to worry about President Rand Paul rewriting the tax code from the Oval Office. We do need to worry about all the other executive actions he might take, but for the most part, I don’t think that’s changed much. The kinds of things he can do are about the same now as they were a week ago.

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Obama’s Immigration Order: Lots of Sound and Fury, But Not Much Precedent

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The GOP Controls Congress So Now It Can Change How Math Works

Mother Jones

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When Republicans took control of both houses of Congress earlier this month, they won an important new power: They can change how Congress does math.

Seriously. Republicans, led by Rep. Paul Ryan (R-Wisc.), their budget guru, are considering altering the way Congress calculates the costs of tax cuts—a move that could make big tax cuts for the rich appear less costly than they really are.

Here’s how it would work. In January, Republicans will be in charge of Congress. And that includes the Joint Committee on Taxation (JCT), which calculates how tax laws affect revenue, and the Congressional Budget Office (CBO), which produces official budget projections. Right now, when the CBO and the JCT calculate the impact of tax laws on government income, they consider how Americans might alter their behavior in response to tax rate changes. But the tax-math bodies do not evaluate how tax legislation could affect economic growth—largely because those sorts of impacts are hard to predict. Republicans have long claimed that tax cuts lead to greater economic activity that inexorably yields more tax revenues—a point much disputed. But Ryan, who in January will head up the House Ways and Means committee—which has jurisdiction over tax reform—and his fellow GOPers are looking to enshrine this Republican belief into the hard and fast calculations of Capitol Hill’s number-crunchers.

Last THIS week, in an interview with the Washington Post, Ryan said he will push to make sure that the two congressional budget scorekeepers use this accounting method when evaluating GOP tax reform legislation. Orrin Hatch (R-Utah), who will chair the Senate finance committee starting in January, said last week that he was open to implementing the change.

Ryan and Hatch can implement dynamic scoring by simply ordering the two budget scorekeepers to accept this budgeting method. Not only that, Republicans can require the CBO and JCT to use very optimistic assumptions about how tax cuts affect the economy—including people’s motivation to work, the response of the Federal Reserve, and household and business decisions on how much to work, save, and invest. Budget analysts then plug those assumptions into several models estimating economic growth, and GOPers can cherry-pick the model that produces the largest number. “The risk is that a Congress that is politically motivated takes the most unrealistic models and plugs in highly rosy assumptions,” says Chye-Ching Huang, a budget expert at the left-leaning Center on Budget and Policy Priorities.

If Republicans don’t want to make these complex choices themselves, they can install directors at the CBO and JCT who they think will use the kind of assumptions they like, Huang adds. Neither congressional Dems nor President Barack Obama can prevent any of this.

Republicans have pushed for this budget-math tweak since the Reagan days. And for years, policy wonks have debated the merits of this novel budgeting method, known as dynamic scoring. Kenneth Kies, a GOP-nominated former director of the JCT, told the Washington Examiner last week that this accounting trick falls “somewhere between pure mathematics and theology.” Because this arcane tweak can make tax cuts for the wealthy appear to cost the government less than they actually do, it is extremely appealing to Republicans. If they make this change, they could argue that new tax cuts would partly pay for themselves.

Democrats say the budgeting trick is a gimmick designed to allow Republicans to chop taxes for the rich without paying the political cost. Ryan’s office did not respond to a request for comment.

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The GOP Controls Congress So Now It Can Change How Math Works

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There’s No Ebola Vaccine Yet Because We Cut the NIH Budget Ten Years Ago

Mother Jones

As we all know, the federal budget is bloated and wasteful. It needs to be cut across the board. Right?

Dr. Francis Collins, the head of the National Institutes of Health, said that a decade of stagnant spending has “slowed down” research on all items, including vaccinations for infectious diseases. As a result, he said, the international community has been left playing catch-up on a potentially avoidable humanitarian catastrophe.

“NIH has been working on Ebola vaccines since 2001. It’s not like we suddenly woke up and thought, ‘Oh my gosh, we should have something ready here,'” Collins told The Huffington Post on Friday. “Frankly, if we had not gone through our 10-year slide in research support, we probably would have had a vaccine in time for this that would’ve gone through clinical trials and would have been ready.”

Collins obviously has some skin in this game, but he’s probably right. What’s more, even without a vaccine we’d probably be better prepared to react to the Ebola outbreak if we hadn’t spent the past decade steadily slashing funding for public health emergencies. The chart on the right, from Scientific American, tells the story.

There are consequences for budget cuts. Right now we’re living through one of them.

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There’s No Ebola Vaccine Yet Because We Cut the NIH Budget Ten Years Ago

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Carbon Emissions Are Higher Than Ever, and Rising

Mother Jones

Yesterday was a good day for the climate movement, as over 300,000 people—according to the event’s organizers—descended on Manhattan for the biggest climate change march in history. The record-breaking turnout was a powerful sign that climate change is gaining traction in mainstream consciousness.

But even as the marchers were marching, new science was released that underscores how just how little time the world has left to break its addiction to fossil fuels. Global carbon emissions are the highest they’ve ever been, and are on the rise, according to a new climate study published in Nature Geoscience over the weekend.

The study totaled global carbon emissions from fossil fuel combustion and cement production—which together account for over 90 percent of total emissions—and found that they rose 2.3 percent in 2013 to their highest level ever recorded, approximately 36.1 metric gigatons.

Emissions have been on the rise for decades, setting a new record almost every year. The rate of emissions growth has increased since the 1990s—when it was 1 percent per year—to the last decade, when the average annual growth rate has been around 3 percent. The rate of growth in 2013 was actually slower than in 2012, the study found, reflecting energy efficiency improvements in the US and Europe that have reduced the amount of carbon emitted per unit of GDP. But that obscures increasing rates of growth in emissions from China and India. Globally, greenhouse gas emissions are still on pace to trigger what scientists say could be a catastrophic amount of warming, said Pierre Friedlingstein of the University of Exeter, the study’s lead author.

“China will be twice as much in 10 years,” Friedlingstein said. “We need to change the trend. There’s a need to reduce emissions in every country.”

Which brings us to the really unsettling part of this report—its attempt to pin down exactly how long we have to make that happen. Climate scientists often talk about a carbon “budget,” which is the total cumulative emissions that will lead to a specified level of global warming. To have a better-than-even chance to stay within a 3.6 degree Fahrenheit increase over 1990s temperatures, the international standard for a reasonably safe level of warming, our global carbon budget is 3,200 gigatons. Since the Industrial Revolution, we’ve used up about two-thirds of that. On our current path, the study finds, we’ll use up the rest in just the next 30 years.

In other words, if the emissions trend isn’t reversed before 2045, we would have to drop immediately to zero carbon emissions on the first day of 2046. Since an instantaneous gearshift like that is obviously impossible, there’s a need to bring emissions under control in the short term. That way we can stretch the “budget” for many more years and not face a choice between catastrophic climate change or a plunge into the Dark Ages.

We’ll get an updated sense of how serious world leaders are about that goal at tomorrow’s United Nations climate summit, which is meant as a curtain-raiser for major international climate negotiations next year in Paris.

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Carbon Emissions Are Higher Than Ever, and Rising

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The U.S. firefighting budget is almost gone, but the forests are still burning

The U.S. firefighting budget is almost gone, but the forests are still burning

On Tuesday, Agriculture Secretary Tom Vilsack said we’ll likely use up our annual budget for fighting wildfires by the end of August, months before the fiscal year ends in October.

As apocalyptic as the fires that have raged in California, Oregon, Washington, and Idaho this year may seem, it isn’t the first time we’ve found ourselves in this lamentable spot. In fact, it’s the seventh time we’ve burned through the budget over the past twelve years. And yet, the budget has stayed the same.

Which means that we’ve had to dip into the funds reserved for preventing fires. Which, along with climate change, means that we’re seeing bigger and bigger fires. Which means that fires end up costing more to put out. Which means … well, you get the picture. We’re creating a feedback loop that only serves to screw us over.

Given that wildfires are predicted to get bigger and badder, if we don’t rethink the budget now, that cycle will only intensify.

From Vox:

There are a couple of reasons why wildfires might be growing. Poor forest management has arguably played a role. In some areas, managers have suppressed smaller fires to protect nearby homes and let brush build up — making the forests more susceptible to massive blazes. Inadequate budgets are another big factor.

But the researchers noted that global warming is also a likely culprit, not least because wildfires are growing in virtually every region in the West.

“The really amazing thing is that we don’t just see an increase in one or two regions,” lead author Philip Dennison, a geographer at the University of Utah in Salt Lake City, told me in May. “We’re seeing it almost everywhere — in the mountain regions, in the Southwest. That tells us that something bigger is going on, and that thing appears to be climate change.”

But, as Grist’s Greg Hanscom wrote, “it’s more than just climate change that’s stoking these flames.”

More than a century of logging turned forests that were built to survive fires into tinderboxes of small, tightly packed trees. And many of our fire fighting efforts have only exacerbated the problem by allowing the fuels to build up further. Add a few hots days, a spark, and a little wind, and all hell breaks loose.

Given the rising costs of managing fires, Obama and some members of Congress have proposed that we prioritize preventing fires over extinguishing them. One thing is sure: If we don’t properly budget and manage our forests now, we’re only borrowing from our future.


Source
The US Forest Service is running out of money to fight wildfires, Vox

Samantha Larson is a science nerd, adventure enthusiast, and fellow at Grist. Follow her on Twitter.

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The U.S. firefighting budget is almost gone, but the forests are still burning

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House Republicans Pass Bill to Lower Taxes on the Rich and Raise Taxes on the Poor

Mother Jones

So what are Republicans in the House of Representatives up to these days? According to Danny Vinik, they just passed a bill that would reduce taxes on the rich and raise them on the poor.

I know, I know: you’re shocked. But in a way, I think this whole episode is even worse than Vinik makes it sound.

Here’s the background: The child tax credit reduces your income tax by $1,000 for each child you have. It phases out for upper middle-income folks, but—and this is the key point—it phases out differently for singles and couples. The way the numbers sort out, it treats singles better than couples. This is the dreaded “marriage penalty,” which is bad because we want to encourage people to get married, not discourage them.

So what did House Republicans do? Naturally, they raised the phase-out threshold for married couples so that well-off couples would get a higher benefit. They didn’t have to do this, of course. They could have lowered the benefit for singles instead. Or they could have jiggled the numbers so that everyone got equal benefits but the overall result was revenue neutral.

But they didn’t. They chose the path that would increase the benefit—and thus lower taxes—for married couples making high incomes. The bill also indexes the credit to inflation, which helps only those with incomes high enough to claim the full credit. And it does nothing to make permanent a reduction in the earnings threshold that benefits poor working families. Here’s the net result:

If the House legislation became law, the Center for Budget and Policy Priorities estimated that a couple making $160,000 a year would receive a new tax cut of $2,200. On the other hand, the expiring provisions of the CTC would cause a single mother with two kids making $14,500 to lose her full CTC, worth $1,725.

So inflation indexing, which is verboten when the subject is the minimum wage, is A-OK when it comes to high-income taxpayers. And eliminating the marriage penalty is also a good idea—but again, only for high-income couples. Which is crazy. I don’t really have a firm opinion on whether the government should be in the business of encouraging marriage, but if it is, surely it should focus its attention on the people who need encouragement in the first place. And that is very decidedly not the upper middle class, which continues to get married at the same rate as ever.

So we have a deficit-busting tax cut. It’s a cut only for the upper middle class. It’s indexed for inflation, even though we’re not allowed to index things like the minimum wage. And the poor are still scheduled for a tax increase in 2017 because this bill does nothing to stop it. It’s a real quad-fecta. I wonder what Paul Ryan thinks of all this?

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House Republicans Pass Bill to Lower Taxes on the Rich and Raise Taxes on the Poor

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Medicare Just Keeps Producing Great Budget News

Mother Jones

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Medicare has been a bastion of good news lately. Every year, the CBO reduces its baseline estimate of Medicare costs, which have dropped by more than $1,000 since 2010. So what’s going on? Tricia Neuman and Juliette Cubanski of the Kaiser Family Foundation round up the evidence:

It is clear that the Medicare savings provisions in the ACA, such as reductions in provider payment updates and Medicare Advantage payments, have played a major role….In addition, the Budget Control Act of 2011 also exerted downward pressure on Medicare spending through sequestration that reduced payments to providers and plans by 2 percent beginning in 2013. And yet even after incorporating these scheduled payment reductions in the baseline, CBO has continued to lower its projections of Medicare spending.

So what else might be going on here? In addition to scheduled reductions in Medicare’s more formulaic payment rates, providers may be tightening their belts and looking to deliver care more efficiently in response to financial incentives included in the ACA, and it is possible that these changes are having a bigger effect than expected. For example, CMS recently reported that hospital readmission rates dropped by 130,000 between January 2012 and August 2013. It is also possible that hospitals and other providers are using data and other analytic tools more successfully to track utilization and spending and to reduce excess costs. Another more straightforward factor is that several expensive and popular brand-name drugs have gone off patent in recent years, which has helped to keep Medicare drug spending in check.

No one knows for sure if these reductions are permanent, or whether high growth rates will reappear in the future. But even if the low growth rates of the past few years can’t be sustained, I suspect that Medicare growth will continue to be lower than anyone expected. There are two reasons for this. First, the growth rate of medical costs in general has been declining steadily for the past 30 years, and this has now been going on long enough that it’s highly unlikely to be a statistical blip. After a surge in the 80s and 90s, we really are returning to the growth rates that were common earlier in the century, and obviously this will affect Medicare.

Second, Obamacare really will have an impact. Not everything in it will work, but it includes a lot of different cost-cutting measures and some of them will turn out to be pretty effective. And who knows? If Republicans ever stop pouting over Obamacare, we might even be able to experiment with different kinds of cost reductions.

There’s a fair amount of year-to-year variability in health care inflation, and we should expect to have some years of high growth. But I’ll bet the average over the next decade is somewhere around 2 percent above the general inflation rate. That’s not too bad.

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Medicare Just Keeps Producing Great Budget News

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Republicans Are Claiming the New Climate Rules Will Wreck the Economy. They’re Wrong.

Mother Jones

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Today the Environmental Protection Agency announced its much anticipated plans to regulate carbon dioxide emissions from existing power plants, the source of about a third of US emissions. It turns out the regulations will be pretty ambitious: a 30 percent decrease in emissions in this sector from 2005 levels by the year 2030 (though some say that is still not enough).

Critics are out in force, of course, and their chief tactic seems to be economic alarmism. Earlier this morning, the front page of Drudge Report displayed this image (bizarrely, as the new rules have nothing to do with oil and wouldn’t drive up gas prices):

Screenshot/Drudge Report

Indeed, the economic doomsaying arguments are everywhere in relation to the new EPA rules. Even before the rules were announced, the National Mining Association was running ads claiming that “an 80 percent cost hike in electricity bills is something we better get used to if extreme new Obama administration power plant regulations take effect.” Also prior to the rules’ actual release, the US Chamber of Commerce put out a study asserting that the consequence of the regulations would be 224,000 lost jobs per year and a $50 billion annual economic hit (up through the year 2030).

And then, there were the elected Republicans: James Inhofe, the Oklahoma senator, claimed the regulations would “cost Americans a fortune.” John Boehner, meanwhile, called them a “sucker punch for families everywhere.” And don’t miss tweets like these from members of Congress:

The EPA, of course, radically disagrees with all of this, and thinks the economic benefits of the new rules should greatly exceed their costs. So who should you trust?

Well, how about history: There is a long tradition of cost overestimates for new environmental regulations. At the Huffington Post, Pacific Institute president Peter Gleick provides an extensive documentation, going back to the 1970s, arguing that such claims of huge costs not only have a long history, but that they are “always wrong.”

Among other things, Gleick links to a 2011 EPA study finding that the benefits of the 1990 Clean Air Act amendments (which, of course, were attacked on grounds of supposed cost) “exceeded costs by a factor of more than 30 to one.” That’s not the only such study. In fact, as the World Resources Institute’s Ruth Greenspan Bell has noted, from 1999 to 2009, EPA water and clean-air regulations overall were clear cost-benefit winners. The total costs, according to a 2010 Office of Management and Budget report, were some $26-$29 billion, while the benefits were far greater: $82-$533 billion.

Dubiousness aside, the striking thing about all of these attacks is that they’re depressingly presentist, missing the big picture about the transformative effect that climate change is having on our world as it unleashes stunning impacts whose ultimate costs are sure to be mindboggling (like, say, 10 feet of sea level rise affecting every coastal city on the planet).

Fortunately, we turned to Bill Nye the Science Guy for some bigger picture perspective. He gave us this statement today: “We have a long way to go in addressing climate change,” he said. “Coal will be controversial for a long time yet. But the longest journey starts with a single step. This is a good one. Let’s get started.”

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Republicans Are Claiming the New Climate Rules Will Wreck the Economy. They’re Wrong.

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