President Biden campaigned on a promise to “end fossil fuel.” Some dismissed it at the time as rhetorical bluster. We now know he was serious. He reentered the Paris Agreement and canceled the Keystone XL pipeline on his first day in office; issued a moratorium on all oil and gas leasing in the Alaska National Arctic Wildlife Refuge; suspended oil and gas leasing on federal lands; pledged to reduce U.S. greenhouse gas emissions—chiefly carbon dioxide (CO2) from fossil-fuel combustion—by 50 to 52 percent below 2005 levels by 2030; pledged to achieve a net-zero electricity sector by 2035; directed the Securities and Exchange Commission, the Department of the Treasury, and other agencies to channel capital flows toward “climate-aligned investments;” and championed hundreds of billions in new subsidies for wind and solar power.
The results have been disastrous. With government threatening their existence, U.S. fossil-fuel producers are reluctant to invest in major new capital projects, and the expectation that demand will increasingly exceed supply in the future has bid up present energy prices. High-cost energy harms lower-income households, contributes to inflation, and puts a drag on the economy. America’s energy sector, the world’s leading hydrocarbon producer in recent years, is once again ceding global market share to Russia and the Organization of the Petroleum Exporting Countries, or OPEC.
At the same time, climate provisions in the Inflation Reduction Act are increasing demand for energy transition minerals much faster than new mines can be opened and processing infrastructure can be built in the United States, largely because of the decades-long permitting delays built into the National Environmental Policy Act. That also contributes to inflation and increases the likelihood of future energy price shocks. Far from being a transition from fossil fuels to renewables, the net-zero agenda looks more like a transition from abundant and affordable energy to scarce high-cost energy.
This section discusses several policy options that can help America’s energy sector unleash prosperity, lower consumer energy costs, and restore U.S. leadership in global energy markets. Other shortcomings in environmental policies predate the Biden administration. We offer alternatives and improvements in several areas, including, most importantly, the Endangered Species Act (ESA).
Environmental Treaty Making
The Paris Agreement has three main political functions:
- Lock the United States into a path of “deep decarbonization” of the
- Mobilize pressure on future U.S. leaders to honor “America’s” (President Obama’s and now President Biden’s) climate policy
- Improve the prospects for anti-fossil-fuel litigation under the national laws of the United States and other parties to the
To accomplish this, the agreement features a combination of legally binding reporting requirements and “politically binding” emission-reduction and climate finance “commitments” on the part of signatories.
The Paris Agreement was the capstone of President Obama’s climate policy agenda. President Trump withdrew the United States from it. However, he did so with the stroke of a pen—the same method by which Obama joined. That allowed President Biden to unilaterally rejoin the Paris Agreement on Inauguration Day 2021.
President Obama called the Paris Agreement the “most ambitious climate change agreement in history.” Indeed, it is. The agreement aims to control the Earth’s climate, transform global energy infrastructure, and mobilize trillions of dollars in climate finance for developing countries.
Yet Obama refused to submit the Paris Agreement to the Senate for its advice and consent, as required by the Treaty Clause of the U.S. Constitution. Instead, he purported to join it based on his sole authority as chief executive—as if it were of no greater consequence to the United States than the bilateral executive agreements signed by President George W. Bush to promote environmental education in Ethiopia, Niger, and the Republic of Congo.
The Paris Agreement is a treaty—a pact subject to the Senate’s advice and consent—by virtue of its costs and risks to the nation as a whole, dependence on subsequent legislation by Congress, potential to affect state laws, past U.S. practice regarding similar agreements, and other common-sense criteria set forth in the State Department’s Circular 175 procedure.
U.S. leadership in producing abundant, affordable, reliable energy strengthens the economy, reduces the cost of living, and enhances U.S. geopolitical security. The Paris Agreement is incompatible with U.S. leadership in fossil fuels because it sets up a global framework for pressuring U.S. policy makers and companies to achieve net-zero emissions by 2050.
The Senate should schedule a debate and vote on whether President Biden should submit articles of ratification to make the Paris Agreement an official treaty of the United States. If fewer than two-thirds of the senators present vote in favor of ratification, Senate leaders should declare that the United States is not a party to the Paris Agreement and never has been.
New Energy, Climate, and Environmental Spending in the Inflation Reduction Act
The inaptly titled Inflation Reduction Act, enacted in August 2022, includes an estimated $369 billion in new spending over the next decade through various handouts to special interests. The actual expenditures in the open-ended tax subsidies for various types of green energy technologies—such as wind, solar, carbon capture and storage, and electric vehicles—could actually be much higher than the estimates. The potential for fraud, corruption, and waste in many of these programs is high.
Rather than investigating after the fact, as with the Solyndra scandal, the 118th Congress should take a proactive approach to oversight.
Areas especially susceptible to fraud, corruption, and waste include the following:
- Approximately $60 billion in mandatory funding for Environmental Justice programs, much of it at the EPA
- An expansion in the Department of Energy’s loan authority to commercially unviable energy projects of up to $350 billion
- $35 billion for rural, agriculture, and conservation programs
- Credits and programs to increase residential and commercial building energy efficiency