[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]


 
             H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011

=======================================================================

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON ENERGY AND POWER

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               ----------                              

                            FEBRUARY 9, 2011

                               ----------                              

                            Serial No. 112-2


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov
            H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011




            H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011

=======================================================================

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON ENERGY AND POWER

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                            FEBRUARY 9, 2011

                               __________

                            Serial No. 112-2


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov



                  U.S. GOVERNMENT PRINTING OFFICE
65-734                    WASHINGTON : 2011
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                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman

JOE BARTON, Texas                    HENRY A. WAXMAN, California
  Chairman Emeritus                    Ranking Member
CLIFF STEARNS, Florida               JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky                 Chairman Emeritus
JOHN SHIMKUS, Illinois               EDWARD J. MARKEY, Massachusetts
JOSEPH R. PITTS, Pennsylvania        EDOLPHUS TOWNS, New York
MARY BONO MACK, California           FRANK PALLONE, Jr., New Jersey
GREG WALDEN, Oregon                  BOBBY L. RUSH, Illinois
LEE TERRY, Nebraska                  ANNA G. ESHOO, California
MIKE ROGERS, Michigan                ELIOT L. ENGEL, New York
SUE MYRICK, North Carolina           GENE GREEN, Texas
  Vice Chair                         DIANA DeGETTE, Colorado
JOHN SULLIVAN, Oklahoma              LOIS CAPPS, California
TIM MURPHY, Pennsylvania             JANE HARMAN, California
MICHAEL C. BURGESS, Texas            JAN SCHAKOWSKY, Illinois
MARSHA BLACKBURN, Tennessee          CHARLES A. GONZALEZ, Texas
BRIAN BILBRAY, California            JAY INSLEE, Washington
CHARLIE BASS, New Hampshire          TAMMY BALDWIN, Wisconsin
PHIL GINGREY, Georgia                MIKE ROSS, Arkansas
STEVE SCALISE, Louisiana             ANTHONY D. WEINER, New York
BOB LATTA, Ohio                      JIM MATHESON, Utah
CATHY McMORRIS RODGERS, Washington   G.K. BUTTERFIELD, North Carolina
GREGG HARPER, Mississippi            JOHN BARROW, Georgia
LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
BILL CASSIDY, Louisiana
BRETT GUTHRIE, Kentucky
PETE OLSON, Texas
DAVID McKINLEY, West Virginia
CORY GARDNER, Colorado
MIKE POMPEO, Kansas
ADAM KINZINGER, Illinois
MORGAN GRIFFITH, Virginia

                                  (ii)
                    Subcommittee on Energy and Power

                         ED WHITFIELD, Kentucky
                                 Chairman
JOHN SULLIVAN, Oklahoma              BOBBY RUSH, Illinois
  Vice Chair                           Ranking Member
JOHN SHIMKUS, Illinois               JAY INSLEE, Washington
GREG WALDEN, Oregon                  JIM MATHESON, Utah
LEE TERRY, Nebraska                  JOHN D. DINGELL, Michigan
MICHAEL C. BURGESS, Texas            EDWARD J. MARKEY, Massachusetts
BRIAN BILBRAY, California            ELIOT L. ENGEL, New York
STEVE SCALISE, Louisiana             GENE GREEN, Texas
CATHY McMORRIS RODGERS, Washington   LOIS CAPPS, California
PETE OLSON, Texas                    MIKE DOYLE, Pennsylvania
DAVID MCKINLEY, West Virginia        JANE HARMAN, California
CORY GARDNER, Colorado               HENRY A. WAXMAN, California (ex 
MIKE POMPEO, Kansas                      officio)
MORGAN GRIFFITH, Virginia
JOE BARTON, Texas
FRED UPTON, Michigan (ex officio)
  


                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Ed Whitfield, a Representative in Congress from the 
  Commonwealth of Kentucky, opening statement....................     1
    Prepared statement...........................................     3
Hon. Bobby Rush, a Representative in Congress from the State of 
  Illinois, opening statement....................................     4
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     6
    Prepared statement...........................................     7
Hon. Joe Barton, a Representative in Congress from the State of 
  Texas, opening statement.......................................     7
    Prepared statement...........................................     8
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, opening statement...............................     9
Hon. John D. Dingell, a Representative in Congress from the State 
  of Michigan, prepared statement................................    23
Hon. John Sullivan, a Representative in Congress from the State 
  of Oklahoma, prepared statement................................   308
Hon. David McKinley, a Representative in Congress from the State 
  of West Virginia, prepared statement...........................   309
Hon. Cory Gardner, a Representative in Congress from the State of 
  Colorado, prepared statement...................................   309
Hon. Lois Capps, a Representative in Congress from the State of 
  California, prepared statement.................................   311

                               Witnesses

James Inhofe, U.S. Senator, State of Oklahoma....................    10
    Prepared statement...........................................    13
Lisa Jackson, Administrator, Environmental Protection Agency.....    26
    Prepared statement...........................................    28
    Answers to submitted questions \1\...........................
Greg Abbott, Attorney General, State of Texas....................    72
    Prepared statement...........................................    74
Harry C. Alford, President and CEO, National Black Chamber of 
  Commerce.......................................................    89
    Prepared statement...........................................    91
Steve Rowlan, General Manager, Environmental Affairs, Nucor 
  Corporation....................................................    99
    Prepared statement...........................................   101
James Pearce, Director of Manufacturing, FMC Corporation.........   104
    Prepared statement...........................................   106
Steve Cousins, Vice President, Lions Oil Company.................   113
    Prepared statement...........................................   115
Lonnie N. Carter, President and CEO, Santee Cooper...............   129
    Prepared statement...........................................   131
Betsey Blaisdell, Senior Manager of Environmental Stewardship, 
  The Timberland Company.........................................   146
    Prepared statement...........................................   149
Peter S. Glaser, President, Troutman Sanders LLP.................   185
    Prepared statement...........................................   188
Margo Thorning, Senior Vice President and Chief Economist, 
  American Council for Capital Investment........................   227
    Prepared statement...........................................   229
Philip Nelson, President, Illinois Farm Bureau...................   241
    Prepared statement...........................................   243
Fred T. Harnack, General Manager, Environmental Affairs, U.S. 
  Steel Corporation..............................................   251
    Prepared statement...........................................   253
James N. Goldstene, Executive Officer, California Air Resources 
  Board..........................................................   277
    Prepared statement...........................................   279
    Answers to submitted questions...............................   656
Lynn R. Goldman, American Public Health Association..............   287
    Prepared statement...........................................   289

                           Submitted Material

``Comments on Draft Technical Support Document for Endangerment 
  Analysis for Greenhouse Gas Emissions under the Clean Air 
  Act,'' report by Alan Carlin, submitted by Mr. Barton..........   312
EPA White Paper, dated February 8, 2011..........................   408
Letter of February 9, 2011, signed by 1,800 professionals from 
  all 50 States, submitted by Ms. Capps..........................   420
``American Lung Association Urges Congress to Reject Chairman 
  Upton's Clean Air Act Bill, press release, dated February 2, 
  2011, submitted by Ms. Capps...................................   438
Communication from former EPA Administrator Stephen Johnson to 
  former President George W. Bush, submitted by Mr. Waxman.......   442
Statement of Mark Z. Jacobson of Stanford University, submitted 
  by Mr. Inslee..................................................   486
Statement of David Gardiner, Executive Director, Alliance for 
  Industrial Efficiency, submitted by Mr. Waxman.................   497
Statements and letters from various organizations, submitted by 
  Mr. Rush.......................................................   504
Statement of National Association of Realtors, submitted by Mr. 
  Whitfield......................................................   646

----------
\1\ Ms. Jackson did not respond to submitted questions for the 
  record.


            H.R. ___, THE ENERGY TAX PREVENTION ACT OF 2011

                              ----------                              


                       THURSDAY, FEBRUARY 9, 2011

                  House of Representatives,
                  Subcommittee on Energy and Power,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 9:38 a.m., in 
room 2123 of the Rayburn House Office Building, Hon. Ed 
Whitfield (chairman of the subcommittee) presiding.
    Members present: Representatives Whitfield, Sullivan, 
Shimkus, Walden, Terry, Burgess, Scalise, McMorris Rodgers, 
Olson, McKinley, Gardner, Pompeo, Griffith, Barton, Upton (ex 
officio), Rush, Inslee, Matheson, Dingell, Markey, Engel, 
Green, Capps, Doyle, and Waxman (ex officio).
    Staff present: Mary Neumayr, senior energy counsel; Peter 
Spencer, professional staff member; Maryam Brown, chief 
counsel, Energy and Power; Elizabeth Lowell, legislative 
clerk;, Ben Lieberman, counsel; Cory Hicks, policy coordinator, 
Energy and Power; Phil Barnett, democratic staff director; Greg 
Dotson, democratic chief counsel, Energy and Power; Alexandra 
Teitz, senior democratic counsel; and Caitlin Haberman, 
democratic policy analyst.

  OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN 
           CONGRESS FROM THE COMMONWEALTH OF KENTUCKY

    Mr. Whitfield. I would like to call this hearing to order 
this morning. The topic of our hearing, it is a legislative 
hearing on the Energy Tax Prevention Act of 2011. I certainly 
want to welcome the members of the subcommittee. I look forward 
to working with all of you as we seek to craft an energy and 
environmental strategy and policy that will be in the best 
interest of the American people, and I believe that can best be 
accomplished by Congress and the EPA working together. Congress 
intends to reassert itself in the statutory and regulatory 
process at EPA.
    I am pleased to be serving again with my friend and 
colleague, the ranking member, Mr. Rush. We served on the CTCP 
Subcommittee in the last Congress, and I look forward to 
working with him as well as all members of the subcommittee.
    I also want to thank our witnesses today and thank them for 
being here to help us look at this very important issue. We are 
going to have four panels of witnesses today, and all of them 
are going to provide us with information that is going to be 
helpful as we move forward.
    Today's hearing is going to focus on greenhouse gas 
rulemaking within the Environmental Protection Agency that many 
of us believe attempts to address an issue properly within the 
purview of the Congress, and then we are also going to be 
talking about legislation that has been introduced that would 
restore the proper balance to decision-making affecting 
greenhouse gases.
    The Obama Administration has been the most aggressive in 
recent memory. As a matter of fact, six rules were issued on 
Christmas Eve and there is a pipeline full of regulations 
waiting to be issued, and States frequently are not being given 
adequate time to reexamine and rewrite State implementation 
plans to respond to this aggressive pace. I, like others, have 
been besieged with calls from entities all over the country 
complaining about EPA's attempt to regulate greenhouse gases. 
Congress has made its will crystal clear on this issue. Our 
esteemed colleague, Chairman Emeritus John Dingell on the 
Democratic side, who led the negotiations on the 1990 Clean Air 
Act Amendments, wrote, ``I would have difficulty concluding the 
House-Senate conferees who rejected the Senate greenhouse gas 
regulatory provisions contemplated regulating greenhouse gas 
emissions or addressing global warming under the Clean Air 
Act.'' As recently as 2008, Mr. Dingell warned that regulating 
greenhouse gases under the Clean Air Act rather than new 
legislation would lead to, as he said, glorious mess. And then 
on July 25, 1997, Senate Resolution 98 expressing the sense of 
the Senate that the United States not be a signatory to the 
Kyoto Protocol that would have required the United States to 
reduce greenhouse gas emissions was approved by the Senate by a 
vote of 95 to nothing. And when the 111th Congress revisited 
this issue last year, it responded with a resounding no to 
regulating greenhouse gases by not passing the so-called cap-
and-trade bill.
    Although Congress has made its position abundantly clear 
not to regulate greenhouse gases, we now have a bureaucracy, 
unelected staff at EPA and the courts pushing the United States 
down a path that in my opinion will cost jobs and make us less 
competitive in the global marketplace. Furthermore, what is 
worse about this is that technology is not available to capture 
greenhouse gases, and we do not have any idea what the cost 
versus the benefits will be. And if the tailoring rule is 
determined to be a violation of the Clean Air Act, which is 
certainly possible, EPA applying the statutes permitting these 
thresholds has estimated that over 6 million sources in our 
country would need to obtain Title V operating permits and also 
it would lead to 82,000 permitting actions annually under the 
preventing significant deterioration formula, and it has also 
been estimated at EPA that doing that would estimate a cost of 
$22.5 billion it would cost permitting authorities in the 
United States.
    So good energy policy is about expanding choices. All of us 
know that our energy demands are going to basically double by 
the year 2035 and we are going to need energy from all sources 
to meet the demands of this country. We are going to 
renewables, we are going to need natural gas, coal, nuclear, 
everything, and I do get the sense that sometimes those people 
who are pushing this country down a quick pathway to green 
energy are more interested in putting fossil fuels out of 
business than they are working to solve this problem. We 
recognize that we have to have energy from all sources.
    So I am delighted that you are here today. We look forward 
to the testimony of all of you.
    [The prepared statement of Mr. Whitfield follows:]

                Prepared Statement of Hon. Ed Whitfield

    Good morning, and welcome to Members of the Subcommittee. I 
look forward to working with all of you as we seek to craft 
energy and environmental policies that will be in the best 
interests of the American people. That can best be accomplished 
by Congress and EPA working together. Congress intends to 
reassert itself in the statutory and regulatory process at EPA 
and specifically the Clean Air Act.
    I am pleased to be serving again with my friend and 
colleague, the Ranking Member, Mr. Rush. We served on the CTCP 
subcommittee in the last Congress and I look forward to working 
with him and all members of this subcommittee.
    I would also like to welcome our witnesses, and thank them 
for being here and for their contributions to today's 
discussions.
    Today's hearing will focus on a greenhouse gas (GHG) 
rulemaking within the Environmental Protection Agency that many 
of us believe attempts to address an issue properly within the 
purview of the Congress, and legislation that would restore the 
proper balance to decision-making affecting it.
    The Obama Administration EPA has been the most aggressive 
in recent memory. Six rules were issued on Christmas Eve and 
there is a pipeline full of regulations waiting to be issued 
and states are not being given adequate time to examine and re-
write state implementation plans to respond to this aggressive 
pace.
    I have been besieged with calls from entities all over the 
country complaining about EPA's attempt to regulate greenhouse 
gases. Congress has made its will crystal clear on this issue. 
Our esteemed colleague, Chairman Emeritus John Dingell, who led 
the negotiations on the 1990 Clean Air Act amendments wrote, 
``I would have difficulty concluding that the House-Senate 
conferees, who rejected the Senate (greenhouse gas) regulatory 
provisions.contemplated regulating greenhouse gas emissions or 
addressing global warming under the Clean Air Act.'' As 
recently as 2008, he warned that regulating GHG's under the 
Clean Air Act rather than new ...legislation would lead to a 
``glorious mess."
    On July 25, 1997, S. Resolution 98, expressing the sense of 
the Senate that the United States not be a signatory to the 
Kyoto Protocol that would have required the United States to 
reduce greenhouse gas emissions was approved by a vote of 95 to 
0.
    When the 111th Congress revisited this issue last year, it 
responded with a resounding no to regulating greenhouse gases 
by not passing the so called ``Cap and Trade'' bill.
    Although Congress has made its position abundantly clear 
not to regulate GHG's, we now have unelected staff at EPA and 
the Courts pushing the United States down a path that in my 
opinion will cost jobs and make us less competitive in the 
global market place. Furthermore, the technology is not 
available to capture greenhouse gases and we do not have any 
idea what the cost vs. benefits will be. If the tailoring rule 
is determined to be a violation of the Clean Air Act, EPA 
applying the statues permitting thresholds has estimated that 
over 6 million sources would need to obtain Title 5 Operating 
Permits and also that it would lead to 82,000 permitting 
actions annually under PSD, resulting in an estimated cost of 
22.5 billion dollars to permitting authorities.
    President Obama and Administrator Jackson have said their 
efforts to regulate GHGs will be considerably costlier and less 
workable than the legislation Congress rejected last year.
    Good energy policy is all about expanding choices - 
including allowing the increased use of coal if the American 
economy needs it. There's a role for alternatives, but only to 
the extent they can compete on a level playing field with 
conventional energy and don't drive up energy costs for 
consumers and businesses. Many of us are concerned that EPA's 
regulations are all about artificially raising the cost of 
using coal and other fossil fuels in order to drive them out of 
the marketplace - in other words, reducing energy choices.
    There's a reason other manufacturing nations, including 
China, are not considering anything even remotely like these 
EPA regulations. They recognize the obvious fact that higher 
energy costs at home will send jobs abroad. Manufacturers in 
China are doing just fine without us handing them a comparative 
advantage with these EPA regulations.
    Let's face it, these regulations and others from EPA amount 
to a war on domestic coal. Coal is the energy source America 
possesses in the greatest abundance. It provides half the 
nation's electricity and 92 percent in my home state of 
Kentucky, and it does so because it is affordable.
    Without coal, residential electric bills would be higher, 
and many energy-using manufacturers would be at a global 
disadvantage compared to other nations that don't hesitate to 
use it.
    For example, in Webster County, Kentucky, we have an 
aluminum manufacturing company, which molds aluminum for 
various products around the world. This facility employs 500 
people in a county with a population of roughly 15,000. EPA's 
regulations will most certainly raise electricity rates to a 
point where these smelters and those jobs will move overseas.
    In addition, without coal, hundreds of thousands of miners 
and others who derive their livelihoods from coal would be out 
of work, and many communities would suffer. In Kentucky, miners 
represent 17,000 people and the indirect impacts of coal keep 
the Commonwealth's economic engine running.
    EPA's global warming regulations are tailor-made to raise 
energy costs for customers of any utility or manufacturer that 
wants to use coal as a fuel source. But EPA's war on coal goes 
beyond that. The agency's decision to revoke a mine permit in 
West Virginia that had already been approved, coupled with 
burdensome new regulations under the Clean Water Act, raise 
troubling questions whether EPA has lost sight of its 
environmental protection role and is trying to set industrial 
policy.
    Of course, in order to meet our energy demand and continue 
to grow our economy, we need all energy sources, including 
coal, natural gas, oil, nuclear and renewables.
    I'm not going to support anything that threatens our 
economic recovery and I will oppose anything that will weaken 
our economy or make us less competitive in the global market 
place. For these reasons, I support the Energy Tax Prevention 
Act, which will properly reassert Congress' authority in this 
area.
    I look forward to hearing from our witnesses and I now 
recognize the Ranking Member of the Subcommittee, Mr. Rush.
                              ----------                              

    Mr. Whitfield. At this time I would like to recognize the 
gentleman from Illinois, the ranking member of the 
subcommittee, Mr. Rush, for 5 minutes for his opening 
statement.

   OPENING STATEMENT OF HON. BOBBY RUSH, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF ILLINOIS

    Mr. Rush. Thank you, Mr. Chairman, and I want to thank you 
very much for this opportunity. I want to congratulate you on 
your selection to become chairman of the Energy and Power 
Subcommittee. As you have indicated, I too enjoyed very much 
working with you when you were the ranking member of the 
Subcommittee on Commerce, Trade, and Consumer Protection. You 
and I worked together hand and hand to move a lot of 
legislation through the subcommittee in the 111th Congress, and 
I look forward to the same outcomes in the 112th Congress.
    Unfortunately, I can't say that the discussion draft that 
we are taking up today exemplifies good legislation. Before 
delivering my opening statement, Mr. Chairman, I want to get a 
few things off my chest. I really have a bone to pick. I know 
that this is a new Congress and a new majority has come in with 
it. That said, our committee rules, procedures and decorum have 
remained substantially the same. Mr. Chairman, if we are not 
careful to set the right course of action moving forward, we 
will find ourselves lost in a sea of confusion, and we get our 
sea legs underneath us, we must try to do better.
    I am extremely troubled by the Majority's stubborn 
resistance to inviting credible witnesses at this hearing who 
think and believe the EPA has a duty and the authority under 
the Clean Air Act to regulate greenhouse gases. Stacking 
different cards with the same suit will rig the outcome before 
the first hand is even dealt. But that isn't what the American 
people and the American taxpayer want, and that is certainly 
not what they deserve. This is the House of Representatives. We 
represent all the American people and all businesses and public 
interest, not just some of them or the ones who support what we 
and our little circles want to do and desire to do.
    As I said earlier, this hearing's focus is on a legislative 
draft known as the Upton-Inhofe Energy Tax Prevention Act. The 
draft bill will eviscerate the EPA by repealing indispensable 
responsibility and authority the agency holds under the Clean 
Air Act to preserve and protect human health, our environment, 
and to promote more efficient use of energy. It would further 
overturn a Supreme Court decision affirming a lower court's 
ruling that the EPA has the authority to regulate greenhouse 
gases and it would prohibit the State of California from 
regulating greenhouse gas emissions from automobiles as well as 
stop the EPA from taking further steps in reducing tailpipe 
emissions. Mr. Chairman, it goes without saying that this 
proposal before us overreaches by large limits, and Mr. 
Chairman, this gets me to what my big rub is today. What 
irritates me the most is the Majority's refusal to invite the 
Administrator of the EPA, Ms. Lisa Jackson, to testify at 
today's hearing. The only reason that Administrator Jackson is 
appearing before us today is because we here in the Majority 
had to kick and scream and scratch so that Madam Administrator 
could have her day and the opportunity to defend her agency's 
findings and judgments here in the halls of Congress. How can 
we formulate good public policy or look at ourselves as fair 
and decent lawmakers if Congress as a body doesn't solicit the 
expert views of the EPA on this legislation? And as a Member of 
Congress, I want to hear as many pertinent viewpoints as I am 
able to hear before deciding how to cast my votes on pieces of 
legislation that are critical to the welfare of our economy, 
our own safety as human beings and preservation of our planet.
    Mr. Chairman, it goes without saying that we should not 
have to push this hard to get key officials and important 
witnesses invited to hearings of this magnitude, and that is 
one reason why, Mr. Chairman, I ask for unanimous consent to 
enter into the record a response dated December 8, 2010, to a 
Wall Street Journal editorial entitled ``The EPA Permitorium.'' 
Mr. Chairman, with that said, I yield back the balance of my 
time.
    Mr. Whitfield. I thank the gentleman for that opening 
statement, and we do look forward to hearing Ms. Jackson. She 
will be here on the second panel, and we all will look forward 
to her testimony.
    At this time I would like to recognize for 5 minutes the 
chairman of the committee, Mr. Upton of Michigan.

   OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN 
           CONGRESS FROM THE COMMONWEALTH OF MICHIGAN

    Mr. Upton. Well, thank you, Mr. Chairman. It is a delight 
to be here, and I would just open my remarks by saying that it 
was the Minority that asked for Administrator Lisa Jackson to 
come, and we are delighted to have her, and with nature, she 
has got a good parking place right outside the door as well. In 
all seriousness, that was the Minority's request and we are 
certainly delighted to make sure that it happened.
    This hearing really is about job creation. It is a simple 
goal but unfortunately one that Washington lost sight of in the 
last few years. No more. Cap-and-trade legislation failed in 
the last Congress in that it did not get through the Senate or 
to the President's desk but now we face the threat of the EPA 
bureaucrats imposing the same agenda through a series of 
regulations. Like cap and trade, these regulations would boost 
the cost of energy not just for homeowners and car owners but 
for businesses large and small. EPA may be starting by 
regulating only the largest power plants and factories but we 
will all feel the impact of higher prices and fewer jobs.
    These regs go after emissions of carbon dioxide, the 
unavoidable byproduct of using coal, oil and natural gas that 
provides the Nation with 85 percent of its energy. These fossil 
fuels are such an important part of our energy mix because they 
are often the most affordable choice. EPA regs seek to take 
away that choice by making the use of these fuels prohibitively 
expensive. It is worth noting that for all the mentions of 
clean energy in the President's State of the Union, he never 
once mentioned keeping energy affordable. Affordable energy is 
what keeps our economy moving.
    We live in a global marketplace filled with manufacturers 
working to produce high-quality goods at the lowest cost. I 
know American manufacturers can compete but not if they are 
saddled with burdensome regs that put us at a distinct, unfair 
disadvantage.
    Needless to say, the Chinese government and other 
competitors have no intention of burdening and raising the cost 
of doing business for their manufacturers and energy producers 
the way EPA plans to do here in America. Our goal should be to 
export goods, not jobs.
    To do that, we released a draft, and it is a draft, called 
the Energy Tax Prevention Act. This is a bill that would 
protect jobs and preserve the intent of the Clean Air Act. It 
is narrowly crafted. It specifically targets the EPA's regs 
under the Clean Air Act that regulate carbon dioxide and other 
greenhouse gases as related to climate change. It allows States 
to continue setting climate policy as they please, but prevents 
those actions from being imposed or enforced nationally. It 
leaves in place the tailpipe standards for cars and light 
trucks from model years 2012 through 2016, and allows NHTSA to 
continue to regulate fuel economy after 2016.
    I have mentioned what this proposal does, but let me also 
emphasize what it does not do. It does not weaken the Clean Air 
Act. It does not limit EPA's ability to monitor and reduce 
pollutants that damage public health. I have looked back at the 
comments made by the authors of the revisions to the Clean Air 
Act in the early 1990s, and I am confident that our bill 
actually restores the Clean Air Act to its intended purpose.
    I yield the balance of my time to Chairman Emeritus Joe 
Barton from Texas.
    [The prepared statement of Mr. Upton follows:]

                 Prepared Statement of Hon. Fred Upton

    Job creation. It's a simple goal, but unfortunately, one 
Washington lost sight of in the last few years. Well, no more.
    Cap and trade legislation failed in the last Congress, but 
now we face the threat of Environmental Protection Agency 
bureaucrats imposing the same agenda through a series of 
regulations.
    Like cap and trade, these regulations would boost the cost 
of energy, not just for homeowners and car owners, but for 
businesses both large and small. EPA may be starting by 
regulating only the largest power plants and factories, but we 
will all feel the impact of higher prices and fewer jobs.
    These regulations go after emissions of carbon dioxide - 
the unavoidable byproduct of using the coal, oil, and natural 
gas that provides this nation with 85 percent of its energy. 
These fossil fuels are such an important part of our energy mix 
because they are often the most affordable choice. EPA 
regulators seek to take away that choice by making the use of 
these fuels prohibitively expensive.
    It's worth noting that for all the mentions of ``clean'' 
energy in the President's State of the Union, he never once 
mentioned keeping energy ``affordable.'' ``Affordable'' energy 
is what keeps our economy moving.
    We live in global marketplace filled with manufacturers 
working to produce high quality items at the lowest cost. I 
know American manufacturers can compete - but not if they are 
saddled with burdensome regulations that put us at an unfair 
disadvantage.
    Needless to say, the Chinese government and other 
competitors have no intention of burdening and raising the cost 
of doing business for their manufacturers and energy producers 
the way EPA plans to here in America. Our goal should be to 
export goods, not jobs.
    To do that, we have released a draft proposal called the 
Energy Tax Prevention Act. This is a bill to protect jobs and 
preserve the intent of the Clean Air Act.
    Our proposal is narrowly crafted.
    It specifically targets the EPA's regulations under the 
Clean Air Act that regulate carbon dioxide and other greenhouse 
gases as related to climate change.
    It allows states to continue setting climate policy as they 
please, but prevents those actions from being imposed or 
enforced nationally.
    It leaves in place the tailpipe standards for cars and 
light trucks from model years 2012 through 2016, and allows 
NHTSA to continue to regulate fuel economy after 2016.
    I've mentioned what this proposal does, but let me also 
emphasize what it does NOT do. It does not weaken the Clean Air 
Act. It does not limit EPA's ability to monitor and reduce 
pollutants that damage public health. Let me repeat that: this 
bill does NOT impact EPA's ability to reduce pollutants that 
damage public health. I have looked back at the comments made 
by the authors of the revisions to the Clean Air Act in the 
early 1990s, and I am confident that our bill actually restores 
the Clean Air Act to its intended purpose.

   OPENING STATEMENT OF HON. JOE BARTON, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Mr. Barton. Well, thank you, Chairman Upton.
    Welcome, Senator Inhofe, former House member and good 
friend and senior member of the other body. We are glad to have 
your comments. I also want to welcome my Attorney General, Greg 
Abbott, my good friend from Austin, Texas, and the General 
Manager for Environmental Affairs of Nucor Corporation, Mr. 
Steve Rowlan, who has several manufacturing facilities in my 
district.
    The great Joe Louis, the heavy champion of the mid-1900s, 
was facing a difficult test with another heavyweight contender, 
and made the comment, ``He can run but he can't hide.'' Well, 
today we are going to use that in the legislative arena. The 
Environmental Protection Agency and the Obama Administration 
have decided basically just because they have the ability to 
decide as the executive branch that they want to put the 
American economy in a straitjacket and cost us millions of jobs 
and hundreds of billions of dollars a year with these 
greenhouse gas regulations. They couldn't get it through the 
legislative process. The Markey-Waxman bill in the last 
Congress barely passed the House and it did not go anywhere in 
the Senate so they tried to do it by a regulatory approach. It 
is not going to work. Chairman Upton and Subcommittee Chairman 
Whitfield have introduced this draft legislation, and I fully 
expect in the next month or two that it is going to pass the 
subcommittee and the full committee.
    So today we are going to start that legislative process. I 
am going to put into the record some comments from one of the 
EPA officials who had the authority at the time to take a look 
at the proposed endangerment finding, and I am going to read 
from the executive summary one sentence and then yield back the 
balance of Mr. Upton's time. It says, ``In many cases, the most 
important arguments are based not on multimillion-dollar 
research efforts but by simple observation of available data 
which has surprisingly received so little scrutiny. In the end, 
it must be emphasized that the issue is not which side has 
spent the most money or pushed the most peer-reviewed papers, 
the issue is whether the greenhouse gas CO2 
hypothesis meets the ultimate scientific test: conformance with 
real-world data.'' What these comments show is that in this 
case the ultimate test, the hypothesis fails. That is why we 
have put this legislation forward and that is why at the 
appropriate time it is going to pass and go to the House floor.
    With that, I yield back.
    [The prepared statement of Mr. Barton follows:]

                 Prepared Statement of Hon. Joe Barton

    Thank you Chairman for holding this important hearing. As 
Chairman Emeritus, I stand with Chairman Upton and Subcommittee 
Chairman Whitfield in support of denying bureaucrats at the 
Environmental Protection Agency (EPA) the right to regulate 
greenhouse gases under the Clean Air Act; and beginning to 
rebalance the power between the executive and the legislative 
branches.
    For the past 2 years, the Obama Administration has been 
using the EPA as the means to create an end that I, along with 
the majority of Americans, strongly oppose. This end results in 
a world where affordable, reliable, and American-based energy 
is no longer freely available. This end results in the loss of 
innovation and job opportunities at home and sends American-
owned companies and their jobs overseas. This end results in 
increasing the cost of fuel, electricity, and other goods and 
services to the American public.
    For the past 2 years, the decisions of executive branch 
bureaucrats at the EPA have not been subject to congressional 
oversight and I am glad that this Committee is beginning to 
remedy that situation starting today. I hope this hearing is 
just the first in a series of hearings discussing legislation 
that addresses several of my concerns, including: the many 
flaws in the EPA's endangerment finding for greenhouse gases; 
the unjustifiable economic harm being passed on to the American 
public at little to no proven benefit, health or otherwise; and 
the inconsistencies in the EPA's approach and attack on 
individual states' air quality standards and permitting 
requirements.
    I would like to offer a special welcome to Texas Attorney 
General Greg Abbott. Attorney General Abbott, along with the 
Texas Commission on Environmental Quality and countless other 
private sector and state representatives, has been fighting a 
good fight and asking the EPA to explain and reconsider 
specific regulations regarding greenhouse gases and permitting 
issues and I look forward to hearing from Mr. Abbott and the 
other witnesses about their interactions and relationships with 
the EPA.
    I, like all Americans, want to breathe clean air and make 
sure that our children and future generations inherit the same 
beautiful country that we enjoy now. We already have laws on 
the books that protect our air and before Congress or federal 
agencies enact new laws we must examine the facts, the science, 
the needs of the American public, and the economic impact of 
new regulations.

    Mr. Whitfield. At this time I recognize the ranking member 
of the full Energy and Commerce Committee, the gentleman from 
California, Mr. Waxman.

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Waxman. Thank you very much, Mr. Chairman.
    Today we hold a hearing on legislation that would rollback 
the Clean Air Act and block the Environmental Protection Agency 
from regulating dangerous carbon emissions from power plants, 
oil refineries and other large polluters. The underlying 
premise of this bill is that climate change is a hoax. That is 
the view of the chief Senate sponsor of this bill and it is 
also the view of our former chairman of this committee, Mr. 
Barton, and that is the foundation of this bill. This 
legislation says carbon emissions do not endanger public health 
and welfare.
    Mr. Chairman, you and the new Republican majority have a 
lot of power to write the Nation's laws but you do not have the 
power to rewrite the laws of nature, and that is the 
fundamental problem with this proposal.
    In 2009, EPA found that carbon emissions endanger public 
health and the environment. That was a scientific conclusion 
that is supported by the National Academy of Sciences, the 
premier scientific organizations of all the world's major 
economies.
    This legislation would overturn EPA's endangerment finding.
    Now, this won't stop carbon pollution from building up in 
the atmosphere. It won't stop the droughts and floods that are 
spreading like an epidemic across the globe. It won't protect 
the air quality of our cities when summer temperatures soar to 
record levels, and it won't stop the strange weather patterns 
that have locked much of our Nation in a deep freeze this 
winter.
    What it will do, though, is gut the Clean Air Act and 
prevent EPA from addressing this enormous threat to public 
health and welfare.
    Protecting public health and preventing climate change 
should not be a partisan issue. In January 2008, Stephen 
Johnson, the former EPA Administrator under President Bush, 
sent a letter to President Bush. Administrator Johnson wrote, 
``The latest science of climate change requires the Agency to 
propose a positive endangerment finding. It does not permit a 
credible finding that we need to wait for more research.'' And 
he said that the Bush Cabinet agreed with this position.
    The science hasn't changed in the last 2 years, in fact, it 
has only gotten stronger. Yet somehow belief in science has 
become another partisan battleground.
    This legislation is called the ``Energy Tax Prevention 
Act.'' This title is total nonsense because EPA has no 
authority to levy energy taxes.
    What this bill should be called is the ``Big Polluter 
Protection Act.'' The only beneficiaries of this legislation 
are the Nation's largest polluters. The biggest backer of this 
bill is Koch Industries, an oil company that spent millions of 
dollars to elect Republicans to Congress.
    Now, members can have different ideas about how to reduce 
carbon pollution. I believe the steps that EPA Administrator 
Lisa Jackson is proposing under the Clean Air Act are moderate 
and appropriate. They are also remarkably similar to the 
measures that former Administrator Johnson recommended to 
President Bush. But I understand that members could reasonably 
have different views. Indeed, I preferred the market-based 
approach recommended by utilities and manufacturers that was 
the basis for the House-passed clean energy legislation last 
Congress.
    But what doesn't make sense is the extreme approach in this 
bill. It will repeal the only authority the Administration has 
to protect our health and the environment without providing any 
alternative. That is another repeal but no alternative to 
replace it. Why replace it? The science is a hoax, we don't 
need to solve the problem, there is no problem. That is the 
underlying assumption. Well, that will only make the problem 
worse.
    History will not judge this committee kindly if we become 
the last bastion of the polluters and the science deniers. When 
carbon emissions rise to record levels and our weather system 
goes haywire, the American people will ask why we acted so 
irresponsibly. I hope we will be able to tell them that we 
stood up for science and public health and rejected this 
extreme proposal. I yield back my time.
    Mr. Whitfield. Thank you, Mr. Waxman.
    At this time we will introduce our first witness, who 
really needs no introduction. Senator James Inhofe from 
Oklahoma is the ranking member of the Senate Committee on 
Environment and Public Works. Of course, he served in the House 
of Representatives. He is recognized as a real expert in the 
field of energy as well as other areas. We are delighted to 
have him with us today, and I might say that he is floating a 
discussion draft over on the Senate side very similar to our 
legislation we have on the House side. So Senator Inhofe, we 
are delighted to have you with us today and we recognize you 
for an opening statement.

   STATEMENT OF JAMES INHOFE, U.S. SENATOR, STATE OF OKLAHOMA

    Mr. Inhofe. First of all, let me thank you for the 
invitation to be here. It is a joy. The only disappointment I 
have is that I am not sitting at the same table with 
Administrator Jackson. I know it surprises and disappoints a 
lot of people that she and I are really very good friends. I 
find her--a lot of liberals aren't this way but in her case, 
she responds to a question, she gives you an honest answer, and 
I have always appreciated that.
    Much to the chagrin of my staff, I am not going to use my 
opening statement that they prepared, but so that they won't be 
completely overlooked, I would like to ask that it be made a 
part of the record, and I will go ahead and ramble just for a 
few minutes.
    Let me share a couple of thoughts that I have with you. 
First of all, this issue is a new issue to the House, 
relatively new. We have been dealing with it since Kyoto, since 
the middle 1990s, and I was in the middle of it back then and 
you are right, you quoted the statement that was made by some 
95 to nothing in the Senate. Now, that statement to refresh 
memories here, was that we are not going to ratify anything 
that doesn't treat developing nations like developed nations or 
that is devastating to our economy. However, most of the 
Senators at that time were believers, and I use the word ``the 
alarmists.'' I think most of them would fit that.
    And so we--and I have to admit, you know, confession is 
good for the soul. When I was the chairman of the subcommittee, 
I believe the Clean Air Subcommittee of EPW, I thought too that 
catastrophic global warming was caused by anthropogenic gases 
because everybody said it was, and it wasn't until the Wharton 
School came out with, I think it was called the Wharton 
Econometric Survey, the question was this: should we ratify the 
Kyoto treaty, what would it cost the people of America, and the 
result was a range. That range was between $300 billion and 
$400 billion a year. Then I happened to think, you know, when 
you got up in the billions and trillions, it is kind of hard. 
You have to bring this back home. I remembered how outrageous 
it was when the Clinton-Gore tax increase of 1993 came through, 
and that was a $30 billion tax increase. I thought wait a 
minute, this is 10 times greater than that. So I thought at 
that time, let us at least look and be sure that the science is 
there, and I remember at that time there was a scientist by the 
name of Tom Wigley. Tom Wigley was commissioned, I believe, by 
then-Vice President Al Gore to answer the question that if all 
nations, all developed nations were to get together and agree 
to the Kyoto treaty and live by their emission standards, how 
much would that reduce the temperature in 50 years. The answer 
was something like seven one-hundredths of 1 degree Celsius. 
Well, of course, that was something that wasn't even 
measurable.
    So when we started questioning the science, all of a sudden 
the scientists came out of the woodwork and they were coming in 
and giving testimonials about how they, the IPCC, would not 
consider any views that anyone had unless they themselves were 
an alarmist. Well, we started talking about that and then 
obviously we did not ratify. By the way, it is important to 
note that the ones who were really pushing the Kyoto treaty, 
that would have been the Clinton-Gore Administration, they 
never submitted to the Senate for ratification. So it is not 
our fault that we never had that before us but they wisely did 
not do it.
    Then we started coming up with the bills. We had McCain-
Lieberman of 2003, McCain-Lieberman of 2005, the Waxman-Markey 
bill, the Lieberman-Warner bill, the Sanders-Boxer bill. Now, 
they were all very similar. Cap and trade is cap and trade. 
Now, you could argue, well, wait a minute--and I am sure 
Congressman Waxman would disagree with this--but all these 
bills along with the Kyoto treaty would cost in that range of 
somewhere between $300 billion and $400 billion a year. It is 
not just Wharton. MIT, Penn State and others have come in and 
talked about that.
    I am going to mention too, I want to end my opening 
statement with two quotes or responses to questions by Lisa 
Jackson that I have a great deal of respect for. Well, we have 
made a decision some time ago as we were trying to defeat and 
successfully did defeat all the bills that I mentioned on the 
Floor of the Senate, and one of the things I did since at best 
the science is mixed, there is nothing conclusive in the 
science, but it is mixed, let us go ahead--and I did this, it 
might have been when we were debating the Waxman-Markey bill or 
it might have been the Sanders-Boxer bill, I can't remember 
which one, but I said even though I don't agree the science is 
there, let us stipulate to it so we can talk about the 
economics, and so we did, and then is when we started talking 
about the cost of this thing.
    I think that maybe in response to questions I can be more 
specific but this bill that I will be the sponsor in the 
Senate, it will be the same wording, I say to Chairman 
Whitfield, that is just one of the problems we are having right 
now with the overregulation of the Environmental Protection 
Agency. We have such things as the boiler and utility MACT--
that is the maximum achievable control technology--ozone, the 
PM 10 dust, hydraulic fracturing, all these things to put 
American jobs either overseas or just kill them and destroy our 
economy. These things are happening right now. This is one part 
of it but a very important part of it.
    Now, what I am going to say within my time frame here and 
make two observations, and this came from Administrator 
Jackson. In one of our committee hearings, and I will tell you 
when it was, it was in December, a year ago December, right 
before, the day before I was going to go to Copenhagen. I was 
the one-man truth squad in Copenhagen, I might add, and before 
I left I said in a hearing, Mr. Chairman, I said, Madam 
Administrator, I understand and I believe that once I leave 
town you are going to have an endangerment finding, and she did 
not deny that and she kind of nodded and with her very pleasant 
smile like she always has, and I said when you do this, it has 
got to be based on some kind of science, what science would you 
base this on, and she said well, primarily it is the IPCC. That 
is the United Nations. Well, that was right in the middle of 
the time that they had been totally debunked. Now, they try to 
say that Climategate wasn't a real thing. It was. They tried to 
play it down. Let me just real quickly, so it is in the record, 
talk about it. Atlantic magazine said the close-mindedness of 
these supposed men of science, their willingness to go to any 
length to defend a preconceived message is surprising even to 
me. The stink of intellectual corruption is overpowering. The 
statement in the Daily Telegraph, this is the largest one in 
London, the scandal could well be the greatest scandal in 
modern science. So we have all of the facts that this is the 
science on which this is based, and I am hoping that people are 
going to keep this in the dialog, let people know how phony 
this was.
    The other thing was, and I am speaking now to the many 
people out not just in my State of Oklahoma but throughout 
America who think I am wrong on this issue, people who really 
believe, people who think that the alarmists are right, that in 
fact that anthropogenic gases are causing catastrophic global 
warming. To them I say this: If they are right, what difference 
does this really make? Because when I asked the question to 
Administrator Jackson, I said if we were to pass this bill, I 
don't know, I say to my good friend, Mr. Waxman, whether it was 
the Waxman-Markey or which bill it was, but I said if we pass 
this, will this have a reduction, result in reducing greenhouse 
gases. Her answer was no, because this only applies to the 
United States.
    I will carry it one step further. If we cause our jobs to 
go overseas as a result of having something like this, those 
jobs are going to go places like China and India and Mexico 
where they don't have any restrictions at all, and so those 
people who say well, we have to set the example in America, 
that China is anxious to follow our great example. I say they 
are laughing at us right now. They are not going to do it. They 
are waiting for those jobs to come over.
    So with that, I would only say that I hope we will get a 
chance to realize that even if this ends up, those people out 
here that really believe this, what we take, the action we take 
whether it is through regulation or whether it is through 
legislation here in the United States is not going to reduce 
the greenhouse gas emissions. Thank you, Mr. Chairman.
    [The prepared statement of Mr. Inhofe follows:]

                      Testimony of James M. Inhofe

    Thank you, Chairman Upton, Chairman Whitfield, and Ranking 
Member Rush for the opportunity to speak to the subcommittee 
this morning. It is an honor to provide testimony to the 
subcommittee on the Energy Tax Prevention Act of 2011.
    The draft bill, sponsored by me, Rep. Upton, and Rep. 
Whitfield, would repeal EPA's authority to regulate greenhouse 
gases under the Clean Air Act. We're doing this for one simple 
reason: EPA's regulations will impose enormous costs for no 
meaningful benefits-in other words, all pain for no climate 
gain.
    I have great respect for Administrator Jackson-she is doing 
what she thinks is right. But I think EPA is taking the wrong 
course. Let me explain.
    Congress didn't allow EPA to regulate greenhouse gases 
under the Clean Air Act. Administrator Jackson even agreed with 
the statement two years ago that the Clean Air Act ``is not 
specifically designed to address greenhouse gases''.
    We also know that EPA's own analysis shows its actions 
won't affect climate change, and the scientific basis of its 
endangerment finding, which the Administrator confirmed to me 
is the UN's Intergovernmental Panel on Climate Change, or IPCC, 
is flawed.
    Now I'm not here to debate science. So let's assume-as I 
did during the Lieberman-Warner debate in the Senate-that 
predictions of more droughts, more floods, more intense storms, 
and more cases of disease are true. What we know is that EPA's 
regulations won't affect any of this.
    EPA's analysis of the Lieberman-Warner bill shows that, 
without aggressive action by China and India, cap-and-trade 
won't reduce greenhouse gases by any meaningful amount. The EPA 
also found that its regulations covering CO2 from cars would 
reduce global temperatures by 0.006 degrees Celsius by 2100. In 
other words: no effect.
    Now what if we added actions by other countries? Dr. Tom 
Wigley of the National Center for Atmospheric Research found 
that full implementation of Kyoto, including action by the 
U.S., Europe, Canada, Russia, and others, would reduce global 
temperature by, at most, 0.21 degrees Celsius by 2100. In other 
words, the Earth would warm about 6 percent less than it 
normally would.
    We know from Wharton, MIT, and others that Kyoto would cost 
about $300 to $400 billion annually through higher gas, food, 
and electricity prices. In fact, that's about the cost of all 
the cap-and-trade bills we've seen since 2003. EPA's 
regulations will be no different.
    The point is this: it is unfair and unacceptable to ask the 
steel worker in Ohio, the chemical plant worker in Michigan, 
and the coal miner in West Virginia to sacrifice their jobs so 
we can reduce temperature by a barely detectable amount in 100 
years.
    Yet this is exactly what the EPA is doing. The Energy Tax 
Prevention Act would stop EPA and protect those jobs. It would 
ensure that America's manufacturers can stay here and compete 
against China. And it would put Congress back in charge of 
deciding the nation's climate change policy.
    EPA's actions under the Clean Air Act are part of the cap-
and-trade agenda. That agenda wants higher energy prices for 
consumers, higher taxes for citizens, more regulations on small 
businesses, more restrictions on choices, and ultimately less 
freedom. Supporters believe these things will stop global 
warming. They won't.
    EPA claims the Supreme Court forced it to act. Not so; the 
Supreme Court ruled that EPA possessed the discretion under the 
Clean Air Act to decide whether greenhouse gases endanger 
public health and welfare. EPA was given a choice, and it made 
the wrong choice. The Energy Tax Prevention Act is the right 
choice for jobs, for consumers, for a growing economy, and for 
the future of America.

    Mr. Whitfield. Thank you, Senator Inhofe. We appreciate 
your testimony.
    Mr. Waxman in his opening statement referred to this letter 
by former EPA Administrator Steve Johnson to President Bush 
about the endangerment finding, and I don't know all the 
details about it so I am going to ask you about it, but it was 
my understanding that once they really got into the process of 
looking at that, a number of federal agencies came out very 
much opposed to an endangerment finding including Ag, Commerce, 
Transportation and Energy. Do you have any recollection of the 
letter that Mr. Waxman was referring to?
    Mr. Inhofe. I do, because first of all, I have a great deal 
of respect for Steve Johnson and I supported his being put in 
the position he was in. I would only say this. Those who want 
to quote him as was quoted in the opening statement here in 
this meeting need to talk about what he said since then. I want 
to quote him now. He said, ``One point is clear. The potential 
regulation of greenhouse gases under any portion of the Clean 
Air Act could result in an unprecedented expansion of EPA 
authority that would have a profound effect on virtually every 
sector of the economy and touch every household in the land.'' 
He went on to say, ``I believe the ANPR demonstrates the Clean 
Air Act, an outdated law originally enacted to control regional 
pollutants that caused direct health effects, is ill-suited for 
the task of regulating global greenhouse gases.''
    Mr. Whitfield. Thanks.
    Mr. Inhofe. And this by way, you mentioned the Departments 
of Energy, Transportation, Commerce, Agriculture and probably 
some others have made this statement.
    Mr. Whitfield. I was looking at the EPA Web site actually 
last night, and there was a comment on there right at the very 
main page. It said ``We are working across the nation to usher 
in a green economy.'' Now, we all recognize, as I said in my 
opening statement, to meet our energy demands, we are going to 
have to have renewables, we are going to have to have 
everything, but this Administration seems to be so focused on 
pushing a green economy, and I know that President Obama in his 
State of the Union address talked about this green economy is 
going to stimulate the economy and create the jobs. And I know 
from the research that I have done personally, one of the 
countries that has been a leader in green energy has been 
Spain, and I read an article just a couple of days ago that 
they have the highest unemployment rate in the industrialized 
world, approaching 20 percent. Do you have the same concerns 
about this all-out push for green energy and the impact that 
that could have on our employment levels in America?
    Mr. Inhofe. Chairman Whitfield, it goes even further than 
that. One of the--I would have to, for the record, give you the 
name of which one of the Administration said this, I think it 
might have been the Under Secretary of Treasury, made the 
statement that we are going to have to do, they say take away 
the perks that are out there for the energy industry so that we 
can force people to concentrate on green energy. I think 
everyone here, I think every Republican and Democrat or the 
Republicans, anyway, they want all of the above. We want gas, 
oil, coal, nuclear, renewables, green, we want it all, but what 
is available now to run this machine called America? We have 
oil and gas.
    This is new information. As of just a year ago, we in the 
United States have the greatest, largest number of recoverable 
reserves in coal, oil and gas of any country in the world. We 
are not number 2, we are number 1. Now, if you look at the 
shale opportunities that are out there and the fact that these 
are close formations, we have enough natural gas to take care 
of this country for 110 years. Now, yes, during that time 
perhaps technology will be here, we will have all kinds of 
green opportunities. That is great. I am all for it. But until 
then, you have got to run this country.
    The thing that bothers me over in the Senate, I hear from 
my good friends John Kerry, Barbara Boxer, they all talk about 
our dependence on foreign countries, for our oil, our energy, 
as if, you know, we shut down fossil fuels and somehow not be 
as dependent upon them. Just the opposite. You know, we have to 
run this machine called America and we can't do it now without 
fossil fuels. If we could release all the political pressures 
that are on our resources out there, we wouldn't have to be 
dependent upon any foreign country or the Middle East for one 
barrel of oil. I forgot what your question is but that is the 
answer.
    Mr. Whitfield. Thank you. I thought it was a good answer.
    I recognize Mr. Rush for 5 minutes.
    Mr. Rush. I thought it was a good question but I didn't 
think it was a good answer.
    Senator, I have the utmost respect for you. I want to thank 
you for taking the time out to come to this hearing. As you 
know, there are some vociferous and very disagreement with some 
of your conclusions, especially as it relates to job creation 
and also electric reliability. Administrator Jackson, she has 
pointed out in her White Paper that she released earlier that 
the environmental, technology and services sectors generated 
under the Clean Air Act an estimated $300 billion in revenue--
that is $300 billion in revenue--and supported nearly 1.7 
million jobs, and I think those are real jobs. That is 
certainly not chump change. Do you have any comments or any 
reaction to her conclusion?
    Mr. Inhofe. Yes, I do, Congressman. First of all, I have a 
Web site , Inhofe.Senate.gov, and if you go there you will 
find, I have talked about the money and the jobs that all these 
overregulations would cause. Now, you are addressing only the 
greenhouse gas, what is happening with the regulations that are 
subject of this committee. But I had mentioned in my opening 
statement, there is also all the MACT laws, the utility MACT, 
the boiler MACT, trying to stop hydraulic fracturing, the 
ozone, all of these issues that are there, the PM10 dust, if 
you add those up, each one has a price tag in terms of dollars 
and the amount of the jobs that would be lost. Those jobs, that 
information comes from most of the labor unions in the United 
States along with, I might add, the National Black Chamber of 
Commerce, who will be testifying, I don't know whether he is on 
today, but he is great. He has testified before our committee. 
And I want you to ask him that question because I think it is 
very specific. The jobs that would be lost, the costs that 
would be there are something that we can't sustain in this 
country.
    Mr. Rush. Thank you, Senator. Senator, let me ask you, as I 
think you are the ranking member on, which committee now?
    Mr. Inhofe. Environment and Public Works.
    Mr. Rush. I wanted to make sure I got it right. And as 
ranking member and during the course of that committee's 
hearings, I am sure you had a number of different hearings on 
this particular subject. Is that correct?
    Mr. Inhofe. We have had hearings.
    Mr. Rush. Has your committee conducted hearings with no 
scientists among the witnesses? Have scientists been included 
in your hearings?
    Mr. Inhofe. Yes, we have scientists there on both sides, as 
you well know, because you are going through this now. When you 
are a minority, you don't get as many witnesses.
    Mr. Rush. But do you find it strange that this hearing is 
being conducted with no scientists at all?
    Mr. Inhofe. We had scientists in our hearing. I would just 
use one, Richard Linzen, for example, from MIT is recognized as 
one of the very top individuals. He testified and----
    Mr. Rush. Senator, which I do understand, but do you find 
that it is strange that at this hearing of this importance that 
we have no scientists on the witness list at all for this 
hearing? Do you find that strange?
    Mr. Inhofe. I don't know. You would have to ask the 
chairman that question. I do know that the Rules of the House 
and the rules of the Senate do provide for minority witnesses 
and so I don't know how this was constructed.
    Mr. Rush. All right. And lastly, Senator, Chairman Waxman 
and I on February 7th sent a letter to the chairman and asked 
him that the Republicans and the Democrats work together to 
write bipartisan legislation to establish a clean energy 
standard. Do you support similar activity in the Senate?
    Mr. Inhofe. Well, yes. We have been trying to do that for a 
long period of time. Unfortunately, CO2 has held 
hostage all kinds of opportunities. We had the Clear Skies 
bill. That would have been SOx, NOx, 
mercury. We could have passed the most restrictive bill in 
terms of emissions, of pollutants but it was held hostage 
because we don't care about all that, we want to make sure that 
CO2 is there. So I do support programs that affect 
kinds of emissions and I strongly support it. I would say this, 
that we are going to go through the process, and I am hopeful 
that I can get my bill passed in the Senate and this bill 
passed here and we will see what happens. It could be we would 
have to override a veto. I don't know. But we may end up--
things are going to change in a couple years so we will have to 
wait and see.
    Mr. Rush. Thank you. I yield back the balance of my time.
    Mr. Whitfield. Thank you, Mr. Rush.
    At this time I recognize Mr. Upton.
    Mr. Upton. Thank you, Mr. Chairman, and again Senator, I 
appreciate you being here, especially on a day that the Senate 
doesn't have votes and I know you are trying to get back to 
snow-laden Oklahoma where they have, I am told, cross-country 
skiing. I am not sure you have got any hills for downhill but 
you have got a good 10 inches last night, and people at least 
can go straight forward.
    Two questions that I want to ask. One is, I mentioned in my 
opening statement, and I wanted you just to comment on, as 
regards to some groups that are offering criticism toward this 
discussion draft. In your view, does it in any way undermine 
the Clean Air Act?
    Mr. Inhofe. No, it is not going to weaken the regulation of 
air pollution that, you know, people are concerned about, 
asthma and heart attacks and all these long list of things, 
lung cancer. The Clean Air Act has reduced air pollution and 
has done so in conjunction with a period of economic growth. 
That is significant because during that period of time all 
these things have actually reduced, and I can't see that this 
would have any effect on that. I did mention that things like 
the Diesel Regulation Act, Clear Skies, these are things that 
we have been trying to do and have done successfully, so we are 
addressing that and have been addressing that with such 
legislation as I just mentioned.
    Mr. Upton. Now, I know that you are writing a book, and----
    Mr. Inhofe. Guess what the name of it is?
    Mr. Upton. Well, you can tell me in a second. I just want 
to know if you are going to talk in your book or you are 
planning to write in your book whether EPA has calculated the 
further reduction in temperature from the tailpipe rule at 
about one-hundredth of a degree Fahrenheit by the year 2100.
    Mr. Inhofe. I think what you are getting to here confirms 
what I said in my opening statement about the Tom Wigley report 
on the Kyoto treaty, that it is hardly detectable. I will tell 
you about my book. I did finish it last week on the 5th, 
although now I see we are going to have to go forward with it a 
little bit further. I won't tell you what it is about but the 
name of the book is The Hoax. Yes, there have been a lot of 
things that--Don Rumsfeld is not the only one writing a book.
    Mr. Upton. Thank you. I yield back, Mr. Chairman.
    Mr. Whitfield. Thank you. At this time I recognize the 
gentleman from California, Mr. Waxman.
    Mr. Inhofe. And he will be the first to receive an 
autographed copy.
    Mr. Waxman. I will be greatly honored. I receive a lot of 
books. In fact, I just got one that pointed out that Jack 
Abramoff was railroaded into prison by the establishment, so I 
am looking forward to reading both books.
    Senator Inhofe, it is my understanding you have said, and I 
think you said it very clearly a minute ago, that this climate 
change idea is just a hoax being perpetrated on the American 
people. Is that right?
    Mr. Inhofe. That is right.
    Mr. Waxman. I am a lawyer, and I don't have a scientific 
background. I understand your degree was in economics and you 
ran small businesses before you were elected to public office. 
Like me, you are not a scientist by training. Isn't that right?
    Mr. Inhofe. That's correct.
    Mr. Waxman. Now, I want to read you a quote from our 
Nation's premier scientific organization, the National Academy 
of Sciences. According to the National Academy of Sciences, 
``Climate change is occurring, is caused largely by human 
activities, and poses significant risks for and in many cases 
is already affecting a broad range of human and natural 
systems.'' Senator, you disagree with the National Academy of 
Sciences. Is that right?
    Mr. Inhofe. Well, I disagree with that particular 
interpretation. I would add that there are several members, 
former members of the National Academy of Sciences, who are not 
there anymore because they disagreed----
    Mr. Waxman. Well, that is their conclusion and you disagree 
with it.
    Mr. Inhofe. And----
    Mr. Waxman. No, Senator, it is my turn now. You are in the 
House and this is a 5-minute round so you know how that goes.
    Mr. Inhofe. Yes, sir. It hasn't been that long.
    Mr. Waxman. Now, you disagree with that and the National 
Academy of Sciences. The National Academy of Sciences is our 
Nation's premier scientific institution. I don't know why they 
would want to mislead the American people. But they are not 
alone. The American Association for the Advancement of Science, 
the American Geophysical Union, the American Meteorological 
Society along with 15 other leading scientific organizations 
have concluded, and I want to quote, ``If we are to avoid the 
most severe impacts of climate change, emissions of greenhouse 
gases must be dramatically reduced.'' Thirteen federal 
departments and agencies including NASA, the National Science 
Foundation, the Department of Defense have reported that global 
warming is ``unequivocal and primarily human induced.'' And the 
leading scientific organizations in England, France, Germany, 
Russia, Japan, China, Brazil and India have all reached the 
same conclusion.
    Now, Chairman Upton and you have gone to the point where 
you say that this is not something we need to deal with. I 
think Mr. Upton says it is a problem that is occurring but he 
doesn't accept it as human emissions that are causing climate 
change. Well, Mr. Rush raised this point. I think it would be 
important and I would request that we hold hearings on this 
fundamental issue of science before we vote on this 
legislation. The premise of the Inhofe-Upton legislation is 
that carbon emissions don't endanger public health. Before we 
proceed, we should call the best scientists in the Nation 
before the committee so we can understand whether Senator 
Inhofe's views or Chairman Upton's are supported by the 
science. But it seems to me what you are saying is, even if 
climate change is real, we can't do anything about it so we 
shouldn't even try, and if that is the situation, I find that 
quite amazing.
    Now, the reason this is under the Clean Air Act is because 
the Supreme Court by 5-4 said EPA must regulate if they have an 
endangerment finding. The Supreme Court by 5-4. There are a lot 
of Supreme Court decisions that went 5-4 that I didn't like but 
this is one where the Court said that this is part of the Clean 
Air Act.
    I think that there is a fundamental flaw in one of the 
arguments that I have been hearing. When you calculate the 
benefits of action, there is an assumption that the United 
States and other nations will take only minimal steps to 
control emissions, but when you calculate the cost, there is an 
assumption, there is a completely different scenario that the 
United States will implement draconian control measures. I 
don't think that is fair. A fair analysis will show that the 
modest measures that EPA is currently proposing will have 
little impact on the economy. In fact, EPA's analysis shows our 
economy grows because we become more energy efficient. In other 
words, we are making a small step forward on climate change at 
virtually no cost to the economy. A fair analysis will show 
that if we adopt more far-reaching measures, we could have a 
major impact on climate change at a manageable cost.
    Last year the House passed the Waxman-Markey bill, passed 
out of this committee as well. That would have reduced U.S. 
emissions by 80 percent by 2050. Modeling of that bill proved 
that we could dramatically reduce pollution for only a postage 
stamp per day while cutting the deficit. Well, I think if we do 
nothing, and this bill is a repeal and no replacement. No 
replacement for dealing with this problem. If it is a real 
problem, let us acknowledge it and figure out a way to deal 
with it and resolve our differences on how to approach a 
constructive resolution. But if it is not a problem, then I 
think what we are doing is saying that we can't do anything 
about the droughts, the floods, the storms, the public health 
and economic misery climate change will cause, so we simply 
should give up trying, and I don't think that is the American 
way. Yield back my time.
    Mr. Inhofe. Mr. Chairman, I know his time has expired but 
he asked me three questions and I can answer them real quick.
    Mr. Whitfield. OK.
    Mr. Inhofe. First of all, I knew you were going to end up 
with the droughts and the floods and all that. It is the fear 
that has been driving this for so long. Let me just answer the 
three questions.
    First of all, the fact that if we were--the reason in my 
opening statement----
    Mr. Waxman. What are the three questions you seek to 
answer?
    Mr. Inhofe. Well, I am answering them right now. One was 
about the reductions. The fact is----
    Mr. Waxman. I asked you whether you disagree with the 
National Academy of Sciences. I asked you very specific 
questions.
    Mr. Barton. Mr. Chairman, we should let our witness make a 
statement. Mr. Waxman talked for 4 minutes----
    Mr. Waxman. Mr. Chairman----
    Mr. Barton. He basically gave an opening statement.
    Mr. Waxman [continuing]. The time now goes to whoever on 
your side is next, and they can yield their time for that 
purpose. But I will go along with whatever the----
    Mr. Barton. We always let the witness answer a question----
    Mr. Waxman. Well, I didn't have a question pending.
    Mr. Inhofe. Yes, you did.
    Mr. Waxman. If the gentleman wants to respond to my 
statements, then that is up to the Chair whether that comes out 
of my time.
    Mr. Whitfield. I will tell you what let us do, Senator 
Inhofe. I am going to go to Mr. Barton and he can ask 
questions. We have a lot of other people, and I am sure that--
--
    Mr. Inhofe. That is fine.
    Mr. Whitfield [continuing]. We will get to the issues. Mr. 
Barton, I recognize you for 5 minutes.
    Mr. Barton. Thank you, Chairman. We do give our witnesses 
the courtesy at the end of their--when somebody gives a 
soliloquy or monolog like Chairman Waxman did to at least make 
a comment on it.
    Senator, you have participated in dozens of hearing on this 
issue in the other body, some as chairman and some as ranking 
member. Is that not correct?
    Mr. Inhofe. That is correct.
    Mr. Barton. And you would consider yourself at least in 
that body to be knowledgeable on this issue?
    Mr. Inhofe. Not scientifically, as pointed out by Mr. 
Waxman, but yes.
    Mr. Barton. You mentioned in your opening statement 
millions of jobs and hundreds of billions per year and studies 
that have been done by independent groups. I think the U.S. 
Chamber has done a study, Heritage has done a study. You 
mentioned MIT. Have any of those studies been refuted by the 
EPA or any other executive branch authority in the Obama 
Administration?
    Mr. Inhofe. No, they haven't. The interesting thing is that 
there is a consistency here. It doesn't matter whether you are 
talking about the Kyoto treaty or any of the other issues or 
bills that we considered including the Waxman-Markey bill, the 
amount is always in that range, $300 billion to $400 billion, 
and that is pretty consistent.
    Mr. Barton. So there has been no refutation of those type 
order of magnitude numbers?
    Mr. Inhofe. I can remember when we have had witnesses from 
the EPA who have agreed with that. Some will not, of course.
    Mr. Barton. And obviously if cap and trade had been 
implemented like Mr. Markey and Mr. Waxman wanted, or if these 
pending greenhouse gas regulations are implemented, we could 
expect that type of an impact and that would certainly be a 
tax, if not explicitly, implicitly, on the U.S. economy. Would 
you agree with that?
    Mr. Inhofe. I would say precisely the same difference in 
what they are attempting to do with regulations and what they 
are attempting to do with legislation so I think it would be 
the same, yes, sir.
    Mr. Barton. Now, you indicated that you have got a draft 
bill that is either identical or very similar to Chairman 
Whitfield and Chairman Upton's bill. Is that correct?
    Mr. Inhofe. That is correct.
    Mr. Barton. Does your legislation or this pending 
legislation that is in draft form, does it change the standard 
on ozone under the Clean Air Act?
    Mr. Inhofe. No.
    Mr. Barton. Does it change the standard on particulate 
matter?
    Mr. Inhofe. No, it doesn't.
    Mr. Barton. Does it change the standard on carbon monoxide?
    Mr. Inhofe. No.
    Mr. Barton. Does it change the standard on nitric oxide?
    Mr. Inhofe. No.
    Mr. Barton. Does it change the standard on sulfur dioxide?
    Mr. Inhofe. No.
    Mr. Barton. Does it change the standard on lead?
    Mr. Inhofe. No.
    Mr. Barton. Those are the six criteria pollutants that are 
regulated under the Clean Air Act. Is that not correct?
    Mr. Inhofe. That is correct.
    Mr. Barton. So if you don't change any of those standards, 
to paraphrase former Chairman Waxman, you are certainly not 
gutting the Clean Air Act, are you?
    Mr. Inhofe. No, sir.
    Mr. Barton. What you are doing, though, Senator, is saying 
that the Clean Air Act and its amendments were never intended 
to regulate CO2 as a pollutant. Is that not correct?
    Mr. Inhofe. Which is also what Mr. Johnson said, yes, sir.
    Mr. Barton. And I think this is a true statement. I was on 
this committee when was passed the Clean Air Act Amendments of 
1990. I was a cosponsor. I participated in the debate. Chairman 
Dingell was the full committee chairman and was very fair in 
allowing what was then the Minority that I was a member of to 
be a full participant in those debates. I don't remember that 
we put CO2 in any way in the Clean Air Act 
Amendments. Is that your recollection?
    Mr. Inhofe. That is correct.
    Mr. Barton. Are you familiar with the comments of a 
scientist or at least a senior staffer at the EPA who has since 
retired named Mr. Alan Carlin?
    Mr. Inhofe. Yes, I am.
    Mr. Barton. And are you cognizant of the report that he 
attempted to publish that was suppressed for some time by the 
EPA that basically said the endangerment finding put forward by 
the Obama Administration was totally incorrect? Now, I am 
paraphrasing when I say totally incorrect but he pointed out 
seven or eight basic flaws that says the hypothesis is not 
supportable.
    Mr. Inhofe. It was a career ender, yes.
    Mr. Barton. He has since retired?
    Mr. Inhofe. Yes.
    Mr. Barton. I am going to submit that statement, this 
report for the record, Mr. Chairman.
    Mr. Whitfield. Without objection.
    [The information appears at the conclusion of the hearing.]
    Mr. Barton. It is about 50 pages, so I don't know what the 
rules are on that lengthy of a statement being put in the 
record, but I would hope the Minority would allow us to.
    And with that, I again thank Senator Inhofe and we look 
forward to working with you, and I yield back, Mr. Chairman.
    Mr. Whitfield. Thank you.
    I am going to call on the chairman emeritus, Mr. Dingell, 
for questions, but before, Mr. Dingell, you ask your questions, 
Senator, it is my understanding that you are going to have to 
leave relatively soon.
    Mr. Inhofe. Well, we are having a problem now. I am trying 
to get back to Tulsa but there is a record snow and maybe they 
are canceling the flights, but yes, I do have to try.
    Mr. Whitfield. OK. Well, then Mr. Dingell, I am going to 
allow you----
    Mr. Dingell. Mr. Chairman, I thank you for your courtesy. 
This will comfort you and I am sure Senator Inhofe. I have no 
questions. I wanted to welcome the senator.
    Mr. Inhofe. Could I use some of your time to answer the 
question from Mr. Waxman?
    Mr. Dingell. Well, all I really wanted to do, Senator, is 
welcome you back.
    Mr. Inhofe. Thank you very much, sir.
    Mr. Dingell. Good to see you again.
    Mr. Inslee. Mr. Dingell, would you mind yielding your time?
    Mr. Dingell. I am sorry?
    Mr. Inslee. Would you mind yielding your time to a fellow 
over here?
    Mr. Dingell. No, I really don't want to.
    [The prepared statement of Mr. Dingell follows:]
    [GRAPHIC] [TIFF OMITTED] T5734.096
    
    Mr. Inslee. Thank you very much.
    Senator Inhofe, welcome to the committee. You were right on 
one thing. You were right on one thing. The alarmists should 
not be listened to because the alarmists are those pessimists 
who figure out that Americans aren't smart enough to innovate 
our way out of this pickle, and we are in a pickle. And 
Senator, thank you for telling about your book. I am going to 
suggest a book you might want to look at. It is called Apollo's 
Fire, a book I coauthored, and it tells you how we are going to 
grow our economy, an economy that the evidence shows we can 
grow.
    Now, the Americans are against this ``Dirty Air Act,'' and 
that is what it is, and I will explain why in a minute. They 
are against this Dirty Air Act three to one, and the reason is, 
they know that the Clean Air Act reduced pollution 60 percent 
over the last 40 years while we grew our economy 207 percent.
    Mr. Inhofe. I agree.
    Mr. Inslee. Americans get it that we can innovate our way 
out of this pickle. Now, this is why this is the Dirty Air Act. 
I hear my friends saying we don't have anything against the 
Clean Air Act, we are not gutting the Clean Air Act. It is like 
saying they are not against the Antiterrorism Act, all we are 
doing is passing a bill saying the FBI can't enforce it. Now, 
when you gut the EPA's ability to enforce the law, you turn the 
Environmental Protection Agency into the environmentally 
pathetic agency, and that is not what Americans want. They want 
something rather than dirty air, and this Dirty Air Act hurts 
kids with asthma, it hurts seniors with respiratory problems 
and it hurts our economy.
    Now, I want to suggest to you there is a fundamental 
problem here. That problem is that we are not listening to the 
scientists, and I am going to ask you a question when I am done 
here in a minute and I hope I give time you to answer. But the 
scientists are telling us that we have got a real health 
problems on our hands. We got a letter from 1,800 
scientifically trained medical professionals yesterday. It says 
communities across the nation will suffer, not maybe, will 
suffer from poor--excuse me--still suffer from poor air 
quality. Low-income families face the impacts of toxic air 
pollution every day from smog causing asthma attacks to toxic 
mercury harming children's neurological development. Far too 
many people face a constant threat from the air they breathe 
and the impacts of climate change. Now, that letter is signed 
by, among others, doctors, Dr. Guillermo Arnaud of Tahlequah, 
Oklahoma, Dr. Therese Kwan of Kingston, Oklahoma, Dr. Warren 
Teal of Carney, Oklahoma. Doctors across this country and 
scientists across this planet know that our health is adversely 
affected by these chemicals, and by the way, carbon dioxide is 
in the Clean Air Act. It is in section 103, if you folks want 
to look at it. Carbon dioxide is in the Clean Air Act. And yet 
you are trying to take away the ability of Uncle Sam to protect 
our kids from asthma, and I have got a problem with that, and I 
am going to ask you this question because I think it is 
fundamental to this disagreement. I respect your opinion and 
right to have an opinion. But the National Science Foundation, 
these doctors, the IPCC, depending on science from the U.S. 
Navy, from Nobel Prize winners, none of whom are going to be 
called by this committee, by the way, and I think it is too bad 
we don't have real scientists up here, all of these people say 
that these things are bad for our kids' health, and yet this 
committee, their first witness calls somebody, rather than 
listening to Nobel Prize winners, thinks somehow that he is 
smarter than the 2,500 scientists that are telling us this is a 
problem.
    Now, I want to ask you this question. You have got, I 
think, grandkids, and I trust that if your grandkids were 
having a health problem, if they couldn't breathe, if asthma is 
affecting them, that you wouldn't take them to a lobbyist for 
the fossil fuel industry, you would take them to a 
pediatrician. You would take them to a scientist. So the 
question I ask you is, shouldn't we listen to the scientists 
here rather than the politicians and shouldn't we trust people 
of science that have an overwhelming conclusion about this 
issue? And I will yield to you for an answer.
    Mr. Inhofe. Thank you very much. And that is essentially 
the same question asked, so I will respond to it. Yes, in the 
very beginning when people were listening just to the IPCC, as 
I said in my opening statement, that has been pretty much 
debunked now. I don't know how anyone with a straight face is 
going to say that that should be the leading science. When you 
mention scientists, yes, many of them are saying this. If you 
go to my Web site , I have given five speeches on this science, 
very long ones, I might add. We started out with some 50 
scientists, went up to 100 and up to several hundred. And so 
there are many scientists that have varying views. That is why 
I say, the science on this issue is mixed. The economics are 
not mixed.
    The last thing I want to mention, because somehow it has 
got to be in this record, and this is responding to Mr. Waxman, 
the Court did not mandate that the EPA regulate CO2, 
and this is words of the Court. The EPA can avoid promulgating 
regulations if it determines that greenhouse gases do not 
contribute to climate change or if it provides some reasonable 
explanation as to why it cannot. Well, what they are saying is, 
they have three choices: either regulate it, don't regulate it 
or do nothing, and that was not a mandate from the Court, and I 
believe that has to be in here at some point.
    Mr. Whitfield. I might say that we did invite a scientist 
to testify. Mr. Chu was invited, and he declined our offer.
    Now, Senator Inhofe, do you have to go now or can you take 
more questions?
    Mr. Inhofe. I think I need to.
    Mr. Whitfield. You need to go?
    Mr. Inhofe. Yes.
    Mr. Whitfield. All right. Well, we appreciate very much 
your taking time to be with us, and we may very well have 
another hearing----
    Mr. Inhofe. Let me thank you, because this is only the 
third since 1984 when I left this that I have been invited to 
appear----
    Mr. Rush. Point of order, Mr. Chairman.
    Mr. Inhofe [continuing]. And I appreciate it.
    Mr. Rush. Point of order, Mr. Chairman.
    Mr. Whitfield. Yes, sir.
    Mr. Rush. Mr. Chairman, I just want to make sure that the 
record accurately reflects that Secretary Chu indicated that he 
had a conflict in scheduling. He didn't decline. It was just a 
conflict in his schedule.
    Mr. Whitfield. Well, we advised Secretary Chu but he had a 
conflict in his schedule. Thank you.
    OK. We will now call our second witness. Thank you, Senator 
Inhofe. And our second witness is the Honorable Lisa Jackson, 
Administrator of the United States Environmental Protection 
Agency, and we are looking forward to her testimony. Ms. 
Jackson, thank you very much for taking the time to join us 
today. We are looking forward to your testimony and the 
opportunity to ask questions. With that, I am going to go on 
and recognize you for an opening statement. I will say that 
Senator Inhofe ended up taking almost 7 minutes in his opening 
statement, so we would be happy to give you 7 minutes in your 
opening statement, so you are recognized.

    STATEMENT OF LISA JACKSON, ADMINISTRATOR, ENVIRONMENTAL 
                       PROTECTION AGENCY

    Ms. Jackson. Well, thank you, Mr. Chairman. I will try not 
to take all seven.
    To you, Mr. Chairman and members of the Committee, thank 
you for inviting me to testify about Chairman Upton's draft 
bill to eliminate portions of the Clean Air Act, the landmark 
law that all American children and adults rely on to protect 
them from harmful air pollution. The bill appears to be part of 
a broader effort in this Congress to delay, weaken or eliminate 
Clean Air Act protections of the American public. I 
respectfully ask the members of this committee to keep in mind 
that EPA's implementation of the Clean Air Act saves millions 
of American children and adults from the debilitating and 
expensive illnesses that occur when smokestacks and tailpipes 
release unrestricted amounts of harmful pollution into the air 
we breathe. Last year alone, EPA's implementation of the Clean 
Air Act saved more than 160,000 American lives, avoided more 
than 100,000 hospital visits, prevented millions of cases of 
respiratory illness including bronchitis and asthma, enhanced 
productivity by preventing millions of lost work days, and kept 
American kids healthy and in school.
    EPA's implementation of the Act also has contributed to 
dynamic growth in the U.S. environmental technology industry 
and its workforce. In 2008, that industry generated nearly $300 
billion in revenues and $44 billion in exports. Yesterday the 
University of Massachusetts and Ceres released an analysis 
finding that two of the updated Clean Air Act standards EPA is 
preparing to establish for mercury, soot, smog and other 
harmful air pollutants from power plants will create nearly 1.5 
million jobs over the next 5 years.
    As you know, Mr. Chairman, the Supreme Court concluded in 
2007 that the Clean Air Act definition of ``air pollutant'' 
includes greenhouse gas emissions. The Court rejected the EPA 
Administrator's refusal to determine whether that pollution 
endangers Americans' health and welfare. Based on the best 
available peer-reviewed science, EPA found in 2009 that manmade 
greenhouse gas emissions do threaten the health and welfare of 
the American people. EPA is not alone in reaching that 
conclusion. The National Academy of Sciences has stated that 
there is a strong, credible body of evidence based on multiple 
lines of research, documenting that the climate is changing and 
that the changes are in large part caused by human activities. 
Eighteen of America's leading scientific societies have written 
that multiple lines of evidence show humans are changing the 
climate, that contrary assertions are inconsistent with an 
objective assessment of the vast body of peer-reviewed science 
and that ongoing climate change will have broad impacts on 
society, including the global economy and the environment.
    Chairman Upton's bill would, in its own words, repeal that 
scientific finding. Politicians overruling scientists on a 
scientific question: that would become part of this committee's 
legacy.
    Last April, EPA and the Department of Transportation 
completed harmonized standards under the Clean Air Act and the 
Energy Independence and Security Act to decrease the oil 
consumption and greenhouse gas emissions of model year 2012-
2016 cars and light trucks sold in the United States. Chairman 
Upton's bill would block President Obama's plan to follow up 
with Clean Air Act standards for cars and light trucks of model 
years 2017 through 2025. Removing the Clean Air Act from the 
equation would forfeit pollution reductions and oil savings on 
a massive scale, increasing America's debilitating oil 
dependence.
    EPA and many of its State partners have now begun 
implementing safeguards under the Clean Air Act to address 
carbon pollution from the largest facilities when they are 
built or expanded. A collection of 11 electric power companies 
called EPA's action a reasonable approach focusing on improving 
the energy efficiency of new power plants and large industrial 
facilities. And EPA has announced a schedule to establish 
uniform Clean Air Act performance standards for limiting carbon 
pollution at America's power plants and oil refineries. Those 
standards will be developed with extensive stakeholder input 
including from industry. They will reflect careful 
consideration of cost and will incorporate compliance 
flexibility.
    Chairman Upton's bill would block that reasonable approach. 
The Small Business Majority and the Main Street Alliance have 
pointed out that such blocking action would have negative 
implications for many businesses, large and small, that have 
enacted new practices to reduce their carbon footprint as part 
of their business models. They also write that it would hamper 
the growth of the clean energy sector of the U.S. economy, a 
sector that a majority of small business owners view as 
essential to their ability to compete.
    Chairman Upton's bill would have additional negative 
impacts that its drafters might not have intended. For example, 
it would prohibit EPA from taking further actions to implement 
the Renewable Fuels Program, which promotes the domestic 
production of advanced biofuels.
    I hope this information has been helpful to the committee, 
and I look forward to your questions. Thank you.
    [The prepared statement of Ms. Jackson follows:]

    [GRAPHIC] [TIFF OMITTED] T5734.097
    
    [GRAPHIC] [TIFF OMITTED] T5734.098
    
    Mr. Whitfield. Ms. Jackson, thank you very much.
    Before you came in, I had mentioned in my opening statement 
that Congress had specifically looked at regulating greenhouse 
gases on three different occasions: one in 1990 when the last 
Clean Air Act Amendments were adopted. They rejected it then. 
Number two, 1998, when the Senate voted 95 to 0 not to take up 
the Kyoto Protocol, objecting to the greenhouse gas regulations 
in the Kyoto Protocol, and then last when the U.S. Congress 
refused to adopt the cap-and-trade bill. So Congress on three 
separate occasions has spoken very clearly that in its opinion 
we do not need to regulate greenhouse gases. So I would ask you 
the question just your personal opinion, do you object to 
Congress having an up or down vote approving or disallowing 
EPA's greenhouse gas regulations?
    Ms. Jackson. Sir, I am here to explain the impact of our 
greenhouse gas regulations and then Congress is obviously going 
to make a determination whether----
    Mr. Whitfield. So you wouldn't object to Congress having an 
up or down vote on your regulations then, correct?
    Ms. Jackson. Sir, I would not presume to tell Congress its 
business.
    Mr. Whitfield. Thank you. Now, I want to ask you, did your 
agency conduct an overall comprehensive assessment of the cost 
of the greenhouse gas regulations?
    Ms. Jackson. We conducted assessments of costs of 
regulations. We did not conduct an assessment of the cost of 
the endangerment finding because it is a scientific finding.
    Mr. Whitfield. But do you have any idea what the costs of 
the greenhouse gas regulations would be?
    Ms. Jackson. As we propose regulations, for example, the 
cars rule that I mentioned in my opening statement, we do a 
regulatory impact analysis that is required----
    Mr. Whitfield. And by the way, on the car thing, it is my 
understanding that cost $52 billion. Is that correct?
    Ms. Jackson. The cost of the cars and trucks rule, I don't 
have the exact number in front of me, but----
    Mr. Whitfield. Well, my understanding----
    Ms. Jackson [continuing]. We also did----
    Mr. Whitfield [continuing]. The light-duty vehicle rule, 
according to the information I have, cost $52 billion and will 
increase in 2016 the cost of one of those vehicles by $948. 
Now, we recognize cost goes along with regulations but it is 
also the information that we have that by the year 2100, the 
greenhouse gas standards for the light-duty vehicle is expected 
to reduce global temperatures by .006 degrees Centigrade, $52 
billion, and that is about mobile sources, and I don't think 
anyone has any idea what the regulation of stationary sources 
will be. Would you give us a guess on what the cost would be on 
that?
    Ms. Jackson. Mr. Chairman, just two points. The auto rules 
that you speak about were hailed by the industry, consumers, 
and environmentalists because of cost savings. There are 
efficiency rules for automobiles and trucks and so they pay for 
themselves, and as the price of gas increases, they pay for 
themselves in shorter and shorter periods. I believe at the 
time the estimate was somewhere between 3 and 4 years. So the 
money you save on gasoline----
    Mr. Whitfield. You know, another understanding that I have 
is that there really is no technology available to really 
reduce greenhouse gases other than efficiencies. Would you 
agree with that?
    Ms. Jackson. There are emerging technologies for stationary 
sources but energy efficiency is thought to be the low-hanging 
fruit in terms of----
    Mr. Whitfield. And that is my understanding, that we are 
getting ready to implement this tremendous greenhouse gas 
regulation. In fact, your air chief indicated that if your 
tailoring rule is determined to be illegal, that EPA is going 
to require 6 million sources to obtain Title V operating 
permits and would have to have 82,000 permitting actions under 
the PSD program resulting in an estimated $22.5 billion just 
for the permitting authorities.
    Ms. Jackson. It sounds like you agree with me, that the 
tailoring rule is a good idea to protect small businesses 
from----
    Mr. Whitfield. But it----
    Ms. Jackson [continuing]. Unneeded regulation.
    Mr. Whitfield. Doesn't it explicitly violate the language 
of the Clean Air Act which says specifically if it is 100 or 
250 tons per year emitting, that it must be regulated?
    Ms. Jackson. No, sir, I don't see it as a violation. I see 
it as looking----
    Mr. Whitfield. But that is what the language says, doesn't 
it?
    Ms. Jackson. The legal theory----
    Mr. Whitfield. And your tailoring rule says what, 25,000 
tons, or is it 75,000 tons?
    Ms. Jackson. It is 100,000 tons, equivalent of a railroad 
car----
    Mr. Whitfield. Tell me about this--well, my time is 
expired. Thank you, Ms. Jackson.
    I recognize at this time Mr. Rush.
    Mr. Rush. Well, Administrator Jackson, I am certainly glad 
to see that you finally arrived. It wasn't easy getting you 
here but you are here.
    First of all, do you have a scientific or a technical 
background?
    Ms. Jackson. Yes, sir, I am a chemical engineer by 
training. I have a master's degree in chemical engineering from 
Princeton University and an undergraduate degree from Tulane 
University.
    Mr. Rush. Well, I am glad to know that. I am glad to know 
that we do finally have someone with a scientific background 
here on the panel.
    Do you find it as amazing as I do that the subcommittee has 
not called any scientists, medical professionals, biologists, 
ecologists or any other scientists to consider this draft 
legislation? What do you think about that?
    Ms. Jackson. Sir, I think if this is going to be a 
referendum on a scientific question, it would be important to 
hear from the best scientists in our country.
    Mr. Rush. Thank you very much. The legislation we are 
considering today overturns your scientific determination that 
carbon emissions are dangerous, and I am concerned about the 
precedent that this would set. Whether carbon pollution is 
dangerous or not is fundamentally, I agree with you, a 
scientific question and not a political question. I believe 
that we should leave these types of decisions to expert 
scientists. Are you aware of any precedent for Congress to 
overrule EPA or any other agency on a question of science like 
this?
    Ms. Jackson. I am not aware of it, sir.
    Mr. Rush. Chairman Upton said yesterday that he does not 
believe that climate change is caused by human pollution. That 
certainly is an extreme view that has been rejected time and 
time again by scientists, so now he is trying a different 
approach. He is asking this committee to approve legislation 
that says he is right and the scientific community has made a 
glaring mistake. I don't believe that is the right way for us 
to proceed. We should be telling you to listen to America's 
best scientists and not ignore them because Chairman Inhofe or 
Chairman Upton have decided that they don't like their 
conclusions. Senator Inhofe testified earlier just a few 
moments ago that the science on climate change is mixed but 
that the economics are not. As I stated during my questioning 
of the Senator, the Clean Air Act has been the catalyst for 
creating close to 2 million jobs and creating an industry 
generating $300 billion in revenues. Are the economics as mixed 
as Senator Inhofe suggests, in your opinion?
    Ms. Jackson. Sir, the history of the Clean Air Act's 
implementation I think is consistent with what we would see for 
its implementation with carbon dioxide and greenhouse gas 
pollution, and that is that our economy can grow and thrive 
because of innovation while we reduce pollution and increase 
energy efficiency.
    Mr. Rush. Thank you, Mr. Chairman. I yield back.
    Mr. Whitfield. At this time I recognize the gentleman from 
Michigan, Mr. Upton, for 5 minutes.
    Mr. Upton. Thank you. Mr. Chairman, and welcome, 
Administrator. You found a parking place okay?
    Ms. Jackson. I didn't find a parking place but I am here.
    Mr. Upton. We had one right out there in the horseshoe. I 
checked with the police in advance.
    Ms. Jackson. Thank you.
    Mr. Upton. I want to ask one quick question on maybe an 
unrelated topic first, and that is the boiler MACT rules. As 
you know, you all asked for a 15-month extension back in 
December, and the court said no, we want them done by, I want 
to say the 21st of February. Would it be helpful, useful, 
constructive if we gave you a little assistance legislatively 
to extend that deadline? Yes or no.
    Ms. Jackson. The EPA argued that we will need to make 
administrative re-proposal of the rule in order to increase the 
amount of transparency in the time that we have, and I am 
disappointed that we have to get the rule out but we will use 
the current administrative processes under the Clean Air Act to 
ensure that the American public and industry gets a chance to 
look at these new rules. They will be significantly different.
    Mr. Upton. So would you like a little, sort of like----
    Ms. Jackson. I believe the Clean Air Act is strong enough 
to allow for that kind of transparency.
    Mr. Upton. OMB is not here. You can say whatever you want. 
You can give the truth. Never mind.
    Let me go to this hearing. You have petitioned to set GHG 
standards for agriculture emissions. We have the Farm Bureau 
coming on a later panel this afternoon. Do you intend to act on 
the agriculture emissions as part of GHG?
    Ms. Jackson. The number of agricultural sources subjected 
to EPA's reporting rule is zero. The number of agricultural 
sources that would face any regulation for greenhouse gas 
emissions under Clean Air Act permitting before July, 2013 is 
zero, sir.
    Mr. Upton. There are GHG emissions from non-road vehicles, 
ships, boats, planes, railroads. Do you intend to set any 
standards for those types of vehicles?
    Ms. Jackson. We have certainly, sir, been petitioned to do 
so. We have made no determination on a regulatory calendar that 
I have been briefed on.
    Mr. Upton. My State of Michigan, there have been some 
reports that the implications of EPA GHG regs for the Michigan 
economy would do a number of things: reduce Michigan GDP by $18 
billion, destroy 96,000 jobs, reduce household incomes by 
nearly $1,600 and reduce Michigan manufacturing output by $2.3 
billion. Those are independent estimates. Has EPA done an 
analysis of what the full costs of regulating GHGs under the 
Clean Air Act would be by State or by the entire country?
    Ms. Jackson. We have done impact analysis and economic 
analysis as we propose and finalize regulations, sir, but the 
analysis you are referring to is of regulations we have yet to 
propose and implications that therefore would be unfair. We 
would actually have to go to industry and ask them to tell us 
what it is they are planning to do in order to tell them what 
the impacts might be so that is a very difficult hurdle and 
probably not one that industry would welcome.
    Mr. Upton. A number of us have commented about the 
regulations that could be imposed in this country versus on 
employers overseas. Does EPA intend to look at the potential of 
jobs leaving the United States and going someplace else? Is 
that going to be a factor that is going to be considered as the 
regulations are pursued?
    Ms. Jackson. Certainly part of our economic analysis is an 
impact on jobs, both jobs that could be lost but also jobs that 
could be gained, and you heard in my opening statement that 
there are potentials for our environmental and air pollution 
control industry jobs to actually have increases.
    Mr. Upton. And that figure, what was it? How many jobs? I 
know you cited--did you say 96,000?
    Ms. Jackson. I believe there was a study yesterday that 
talked about nearly 1.5 million jobs over the next 5 years. 
That was not an EPA study, that was University of Massachusetts 
and CERES. That is an independent study.
    Mr. Upton. So if the Continuing Resolution which might be a 
funding freeze at 2008 levels is adopted, that would be--you 
would have a pretty difficult reaching that number of 
inspectors. Would these be EPA government jobs?
    Ms. Jackson. Sir, this was an independent----
    Mr. Upton. Would they be contracted out?
    Ms. Jackson. No, no. These are not government jobs in any 
way, and with respect to your question on budget, the EPA's 
regulatory authority incentivizes and promotes innovation in 
the private sector. It promotes investments here. There are 
estimates that there is almost $2 trillion waiting to be 
invested in this country, and that is what that study is----
    Mr. Upton. I mean, what I am interested in is the net 
increase or decrease in jobs, and you may have more inspectors 
that are out there but at the same time you might not have 
nearly as many companies still producing goods here because 
they might go someplace else. I am more concerned about a 
dramatic net loss of jobs rather than an increase based on the 
proposal.
    So I see my time is expired. Thank you, Mr. Chairman.
    Ms. Jackson. I just want to clear up for the record, I 
don't know what net increase in inspectors you are speaking of. 
I do believe that we remain committed to enforcing the Clean 
Air Act but none of the jobs numbers that I speak about are 
public sector employment, they are private sector employment. 
Thank you.
    Mr. Whitfield. The gentleman from California is recognized 
for 5 minutes.
    Mr. Waxman. Thank you, Mr. Chairman.
    Administrator Jackson, the Republicans have made the 
argument that you don't have the authority under the Clean Air 
Act to do this regulation of greenhouse gases. Are they right?
    Ms. Jackson. No, sir, they are not.
    Mr. Waxman. The Clean Air Act requires you to regulate 
carbon emissions?
    Ms. Jackson. Yes. As the Supreme Court said, greenhouse gas 
emissions fit within the definition of pollution under the 
Clean Air Act.
    Mr. Waxman. Republicans further have made the argument that 
public health is not at risk from these greenhouse gases. Could 
that be true?
    Ms. Jackson. No, sir, I don't believe that to be the case. 
The endangerment finding is about that very issue, and in that 
finding, we determined that unchecked greenhouse gas emissions 
increase the intensity and duration of heat waves. That 
increases heat-related mortality and morbidity, especially 
among children, among the elderly, among the sick, people who 
work outdoors, people who can't afford air conditioning or have 
never needed it because their climate was temperate enough. By 
raising temperatures, you also exacerbate the impact of smog, 
and we know the life-threatening impacts of smog on people who 
have compromised lung function, especially people with asthma 
and other lung diseases. Unchecked emissions are said by our 
best scientists to increase the severity of flooding, and 
having grown up in New Orleans and seeing the impacts of 
flooding on just one small part of the town, the part I know, I 
know that that also means more contamination, more pollution, 
more disease as we deal with the impacts of our changing 
climate.
    Mr. Waxman. So this is really a threat to the public 
health, and if we don't regulate we are allowing that threat to 
become greater?
    Ms. Jackson. That is the nexus of the endangerment finding. 
It is a threat to our public health as Americans and our 
welfare, sir.
    Mr. Waxman. You have been criticized for this finding that 
greenhouse gases endanger the public. Mr. Abbott, the Texas 
Attorney General, claims that the finding is arbitrary and 
legally flawed. We learned yesterday, however, that your 
predecessor in the Bush Administration looked at the science 
and apparently reached the same conclusion you did. In a 
private letter to President Bush, Administrator Johnson stated, 
and I quote, ``The latest science on climate change requires 
the Agency to propose a positive endangerment finding as was 
agreed to at the Cabinet-level meeting in November.'' According 
to Mr. Johnson, ``The latest climate change science does not 
permit a negative finding nor does it permit a credible finding 
that we need to wait for more research.'' And I gather Mr. 
Johnson didn't like to have to say that because he is not happy 
about the proposals that you have made, but as a matter of 
fact, what you have proposed is very similar to what he would 
have had to propose as well. Are you surprised that the 
predecessor in the Bush Administration privately reached the 
same conclusion that you have?
    Ms. Jackson. I think that the letter which I saw yesterday 
when it was released is proof that it is not me sitting in the 
administrator's chair who looks at the science and makes a 
finding of endangerment but clearly past administrators have 
felt and have believed the same based on their----
    Mr. Waxman. Well, once you have reached those findings, 
once you have reached the conclusion that this is not a hoax 
but that public health and welfare are endangered, then the 
question is, what do we do about it? And the Republican 
approach is not to let anything be done, not to pass 
legislation--they didn't offer an alternative to our bill last 
year--not let EPA act. In fact, they would go so far as to say 
that you can't even allow some of the voluntary efforts to 
report and try to reduce carbon emissions. You are being 
vilified for proposing the same measure that your Republican 
predecessor called ``prudent, responsible, cost-effective, and 
practical.'' Both Republican and Democratic Administrators saw 
the same science and reached the same conclusion. 
Unfortunately, President Bush and his people told Administrator 
Johnson don't move forward on it. You represent a President 
that wants to protect the public health, safety, and well-being 
and he has allowed you to do your job. I think that Congress 
ought to allow you to do your job as well. And if we have an 
alternative, let us hear what it is, but saying there is no 
problem, it is all a hoax, is not a responsible answer.
    Thank you, Mr. Chairman.
    Mr. Whitfield. I recognize the gentleman from Texas for 5 
minutes.
    Mr. Barton. Thank you. Thank you, Mr. Chairman.
    The Minority seems to be of the impression that we didn't 
want you to attend, Madam Administrator. We are delighted you 
are here. If I knew you better, I would come down and hug you. 
I can assure you that Chairman Upton and Chairman Whitfield and 
Chairman Stearns are going to invite you numerous times, you 
and your deputies, to come before this committee and its 
various subcommittees for the next 2 years. So welcome, and we 
do appreciate your attendance.
    I need to educate the subcommittee briefly before I start 
asking my questions because there is an attempt by Chairman 
Waxman and perhaps by yourself to rewrite history. The Clean 
Air Act does not specifically mention CO2 as a 
criteria pollutant. The reference that Mr. Inslee made talks 
about ozone, not carbon dioxide. The court case in 
Massachusetts v. EPA was a 5-4 decision in which the majority 
of the Supreme Court said that since it did not explicitly 
prohibit CO2 being regulated under the Clean Air 
Act, it might could be, and the EPA needed to--I don't think 
the EPA needed to but it said the EPA could make a decision.
    As you well know, when your Administration, Mr. Obama, 
President Obama, came into office very quickly issued an 
endangerment finding, saying that CO2 should be 
regulated. Mr. Waxman alluded to a private letter that has 
miraculously come forward in the last day or so for this 
hearing, and I would emphasize the term ``private.'' I would 
hope that maybe we could get Carol Brown's private 
correspondence and some of the other Obama officials' private 
correspondence. We do have some e-mails from the direct 
supervisor of Mr. Carlin back and forth to people in the White 
House in which Mr. Carlin is explicitly told stop investigating 
whether CO2 is a danger, the decision has been made, 
the White House has decided that they are going to issue a 
endangerment working, stop working on this report. I don't have 
those e-mails with me but they are available.
    So I am going to ask you the same question that I asked 
Senator Inhofe. Under the Clean Air Act, which is the law of 
the land, as amended, does anything in Mr. Whitfield's and Mr. 
Upton's pending legislation change the standard on ozone?
    Ms. Jackson. The----
    Mr. Barton. The answer is no.
    Ms. Jackson. Would you like me to answer, sir?
    Mr. Barton. Well, I am willing if you will go through it 
quickly. I have got a minute and 50 seconds here.
    Ms. Jackson. I see. Well, what I would say is that I am 
concerned that there needs to be an analysis to ensure that 
there aren't unintended consequences. My belief is that there 
is no intention in the legislation----
    Mr. Barton. But the legislation does not change the 
standard on ozone, it does not change the standard on 
particulate matter, it does not change the standard on carbon 
monoxide, it does not change the standard on NOx, it 
does not change the standard on sulfur dioxide and it does not 
change the standard on lead, does not change the enforcement 
criteria, does not change the quantities, does not change any 
of the Clean Air Act on the criteria pollutants that this 
committee amended and passed back in 1990. Is that not correct?
    Ms. Jackson. I believe the intent is only to gut portions 
of the Clean Air Act, sir, not----
    Mr. Barton. That is the Clean Air Act.
    Ms. Jackson. But it is changing, gutting portions of the 
Clean Air Act----
    Mr. Barton. How?
    Ms. Jackson [continuing]. For certain pollution, some of 
which is pollution----
    Mr. Barton. CO2----
    Ms. Jackson [continuing]. Not only because it is a 
greenhouse gas.
    Mr. Barton. Madam Administrator, CO2 is not 
mentioned in the Clean Air Act. It is a 5-4 decision that it 
might be. It is your Administration's position that it should 
be. I respect that. I respect that. But that doesn't mean that 
it has to be, and unless you can refute all these cost-benefit 
analyses that have been done independently about the millions 
of jobs and hundreds of billions of dollars per year, I would 
say that the Congress as an independent arm of the Federal 
Government has an obligation to clarify what the Clean Air Act 
really does regulate. That is our obligation. Do you have an 
objection to that?
    Ms. Jackson. Again, sir, I would not presume to tell the 
Congress its business in any way.
    Mr. Barton. Well, my time is expired. I am going to yield 
back. I am going to ask you some specific questions in writing 
about what you are doing in Texas. You have denied every 
existing air permit issued since 1992, and we are going to ask 
some specific questions about that. Thank you.
    Mr. Whitfield. I recognize the gentleman from Michigan for 
5 minutes of questions.
    Mr. Dingell. Mr. Chairman, I thank you.
    Madam Administrator, welcome to the committee. I have a 
number of questions on which I would like, if possible, to get 
yes or no answers, and I say that with respect.
    EPA has already issued regulations under Title II of the 
Clean Air Act. It has issued its determinations for regulations 
under the Title V permit program and it is also for under 
sections 111 for the prevention of significant deterioration, 
and in addition to that, it would appear that EPA can issue 
regulations under the National Ambient Air Quality Program. Is 
that correct?
    Ms. Jackson. Yes, sir.
    Mr. Dingell. So we have a potential here then for at least 
four different sets of regulations plus State implementation 
plans which could also cover these questions?
    Ms. Jackson. Yes, sir.
    Mr. Dingell. So you have an unholy complicated mess here if 
you are going to regulate greenhouse gases. Is that right?
    Ms. Jackson. Pursuant to the Clean Air Act, those are all 
requirements, sir.
    Mr. Dingell. Now, Madam Administrator, what other 
provisions of the Clean Air Act can EPA use to issue 
regulations in the next 5 years in terms of greenhouse gas 
emissions?
    Ms. Jackson. Sir, did you mention the new source 
performance standard provisions of the Clean Air Act? EPA has 
already announced the schedule to put forth new source 
performance standards for utility sector and for the refinery 
sector. I know you said 5 years, but those are in the next 2 
years.
    Mr. Dingell. This gives you an unbelievably complicated 
process, especially if you are going to bring the States into 
the matter as required under the state implementation plans.
    Now, Madam Administrator, how many different regulations to 
introduce greenhouse gas emissions could this add up to? I 
don't think you can tell us here this morning, and I am not 
sure anybody including the prophet Esau can give us that 
number. But would you please submit for the record the number 
of potential regulations and the number of potential regulatory 
sources under the statute that are going to be used here.
    Now, Madam Administrator, so it is clear that these 
regulations could add up to a great multiplicity of stationary 
and mobile source controls. Isn't that right?
    Ms. Jackson. Yes, sir, but I do want to point out that the 
purpose of tailoring rule was to manage that workload in a way 
that ensures that the vast majority of sources would not be 
caught----
    Mr. Dingell. Madam Administrator----
    Ms. Jackson [continuing]. Under the Clean Air Act.
    Mr. Dingell [continuing]. This is not to criticize you, it 
is to try and dig you out of an intolerable hole in which I 
find you, and I am looking forward to your help in achieving 
that very important purpose.
    Now, under the provisions of the bill before us, should 
this legislation become law, it would repeal the endangerment 
finding. Does that put the national standards at risk? Yes or 
no.
    Ms. Jackson. Yes, sir, I would think it would invite 
litigation on past standards, and future standards are 
explicitly prohibited under the draft.
    Mr. Dingell. Now, Madam Administrator, do you and the 
Administration firmly support a national standard for auto fuel 
economy and greenhouse gas emissions, and are you committed to 
a single national standard for the model years 2017 to 2025?
    Ms. Jackson. Yes, sir, we are very much committed to 
working collaboratively with the industry and the States and 
staying at the table as we did for the standards that we put 
out in May of 2010.
    Mr. Dingell. Now, does the draft legislation prevent EPA 
from enforcing greenhouse gas reporting rule which contains 
information that could inform the Congress relative to the 
Congress's future action? Yes or no.
    Ms. Jackson. Yes, sir.
    Mr. Dingell. Now, Madam Administrator, EPA's endangerment 
finding, let us refer to that, was that or is that a scientific 
finding or a political finding?
    Ms. Jackson. It is a scientific finding, sir.
    Mr. Dingell. Now, Madam Administrator, could EPA have found 
otherwise than it did?
    Ms. Jackson. No, I do not believe so, sir.
    Mr. Dingell. Madam Administrator, did your predecessors in 
the previous Administration, that of Mr. Bush, find or propose 
otherwise than you have done?
    Ms. Jackson. An endangerment finding was prepared and sent 
to the White House but the White House did not open the e-
mails.
    Mr. Dingell. OK. We have done it with 7 seconds overrun. 
Thank you.
    Ms. Jackson. Sir, may I correct one inaccuracy in my 
answer? National ambient air quality standards and State 
implementation plans are not required for greenhouse gases at 
this time. We have been petitioned with respect to that matter. 
Thank you.
    Mr. Dingell. But I should be somewhat concerned that a 
court which would make a finding that the Clean Air Act 
affected greenhouse gases, that they might insist that that 
also be used on the State implementation plans. Isn't that so?
    Ms. Jackson. Yes, sir. I just wanted to be clear on the 
current state of----
    Mr. Whitfield. I recognize the gentleman from Illinois, Mr. 
Shimkus.
    Mr. Shimkus. Thank you, Mr. Chairman.
    Welcome, Administrator Jackson. Just so we don't get into a 
debate next week when we have our hearing on the environment 
and job creation, I am formally asking you if you would like to 
return to talk, to address my subcommittee that deals with a 
huge portion of the portfolio and also jobs. This hearing is 
about jobs, and that is why we are focused on it. So I will 
give you time to think about it, but I am formally asking you 
if you would like to join us next week at our hearing.
    This hearing is about jobs, and there is a chart on the 
screen, and I don't know if you have ever seen it, the National 
Environmental Policy Act and Environmental Protection Agency 
were both first authorized in 1970. Have you ever seen this 
char? Has it ever occurred to you that there appears to be a 
cause and effect between U.S. oil imports and these policies? 
If you look, what it is up there is production and imports, and 
as we have been involved with, and a lot of us would agree, 
important Clean Air Act amendments, it has affected jobs and 
our reliance on imported crude oil. Have you ever seen that, 
and do you think there's a relation?
    Ms. Jackson. Sir, it is the first time I am seeing this 
particular chart, and what I do know is that the energy 
efficiency and ability----
    Mr. Shimkus. But you wouldn't dispute that our importation 
and our ability to produce has declined? I mean, those are just 
Energy Information Agency. Timeliness with the Clean Air Act 
and Clean Air Act Amendments, it has had an effect on our 
energy production. Well, let me move on. I will give you a 
chance to look at that, and maybe next week----
    Ms. Jackson. I don't see anything on that chart that talks 
about the Clean Air Act, sir, but I would be happy to----
    Mr. Shimkus. Well, it is related to the time frame on the 
bottom with 1970, so this is a timeline from 1920 to 2000, so--
--
    Ms. Jackson. I am sure there are a lot of things that 
happened in 1970 that can't be attributed----
    Mr. Shimkus. Let me just go back now to other issues. This 
is about job creation and the effect that the Environmental 
Protection Agency has, and we are going to hear the testimonies 
when we have the next panel. Let me--you recognize these folks, 
right? And my friends on the other side. These are the folks 
that were affected by the 1992 Clean Air Act Amendments. This 
is from Kincaid Mine in my district. One thousand miners' jobs 
were closed because of the Clean Air Act. The reason why we 
could not pass into law through the Senate Waxman-Markey is 
because we successfully made the argument that this would 
create higher cost energy and jobs would be destroyed, and 
these folks should be awarded a medal for stopping the job-
destroying aspects of the Waxman-Markey bill. Illinois lost 
14,000 jobs during the last round, and Ohio lost 35,000 jobs 
during the Clean Air Act Amendments.
    And so this hearing is about jobs and the effects of jobs, 
and I think we can make an argument on carbon dioxide not being 
a criteria pollutant under the Clean Air Act and that we have 
gone around the legislative ability by using the courts and 
using regulatory authority to regulate something that should 
not be regulated but let us assume you all are successful. I 
have in front of me a power plant that is being built, 1,600 
megawatts. If we mandate them to reduce carbon dioxide 
emittance by 60 percent, what amount of the energy that they 
produce will have to be used to capture that carbon? Do you 
know what that is?
    Ms. Jackson. Sir, I am sure you are going to give me the 
number.
    Mr. Shimkus. It is 22 percent. The energy that they are 
going to put on the grid will now have to capture. If they go 
to 85 percent, do you know how much energy that would require? 
Thirty percent of what they were going to put on the grid to 
sell. Do you believe in the law of supply and demand?
    Ms. Jackson. Do I believe in the law of----
    Mr. Shimkus. Supply and demand, economics 101.
    Ms. Jackson. The economic principle of supply and demand? 
It is not a tenet of faith, sir. It is a----
    Mr. Shimkus. No. Do you believe it?
    Ms. Jackson [continuing]. An economic model, and I was 
trained in it.
    Mr. Shimkus. Do you believe it?
    Ms. Jackson. Yes, I believe that it is generally----
    Mr. Shimkus. That if you constrain a product and there is a 
high demand, that costs go up?
    Ms. Jackson. It depends on the elasticity of the cost 
curves.
    Mr. Shimkus. And I would say that here is an example of us 
having power on the grid that this regulation is now going to 
constrain because we are going to have to use energy to capture 
carbon which is not energy we can put on the grid so the people 
who are going to buy this have to buy, what, higher power. You 
know what the capital expense for this power plant is if they 
are going to build new facilities to capture carbon, what is 
the new capital expense at 60 percent? It is $1.8 billion. If 
it is 85 percent, their capital expense, this is new spending, 
$2.3 billion.
    Ms. Jackson. Sir, under the----
    Mr. Shimkus. Do you know where they have to go to pipe the 
carbon capture and sequestration, how far? We think the closest 
might be 70 miles. Who is going to pay for the pipeline? And 
then how big a sequestering facility has to be there? The point 
is, this regulation is going to skyrocket electricity costs, 
which will destroy jobs.
    I yield back my time, Mr. Chairman. Thank you.
    Mr. Whitfield. Thank you.
    Ms. Jackson. Sir, may I respond to just a few things for 
the record?
    Mr. Whitfield. Sure.
    Ms. Jackson. The first is, under the Clean Air Act, which 
is a public health----
    Mr. Shimkus. Mr. Chairman, I would like to, if she would 
yield, I would address this the same way that Chairman Waxman 
addressed Senator Inhofe and not allowing him, so if my 
colleagues on the other side want to give her time, they should 
do it on their time.
    Mr. Whitfield. Very good point.
    Mr. Inslee, you are recognized for 5 minutes.
    Mr. Inslee. Thank you. I think this is interesting, a 5-4 
Supreme Court decision was good enough in Bush v. Gore to be 
settled law. A 5-4 decision in United Citizens was good enough 
to allow corporations to run America. But all of a sudden a 5-4 
decision of the Supreme Court that you expect the EPA and us to 
just ignore.
    Now, I want to make sure that we are clear about this. The 
Supreme Court, which binds all of us who have taken an oath to 
the Constitution at the moment, says, ``Carbon dioxide, 
methane, nitric oxide and hydrofluorocarbons are without a 
doubt physical and chemical substances which are emitted into 
the ambient air. The statute is unambiguous.'' The statute is 
unambiguous. Madam Administrator, is it clear that you are 
bound by this decision and that we have got to regulate 
CO2?
    Ms. Jackson. Absolutely, sir.
    Mr. Inslee. And I want to tell you the last witness, 
Senator Inhofe, we appreciate him coming here. We know he is a 
person of strong beliefs. He tells us he is writing a box 
called The Hoax. Now, I haven't seen it but I think it is about 
the alleged Apollo moon landing on the lunar surface because we 
know there are people that are still out there doubting that. 
They are doubting that the National Academy of Science has 
confirmed we landed on the moon. They are doubting the IPCC 
that confirmed we have landed on the moon, but there are still 
those who doubt.
    And I want to ask you about the status of science on this. 
Could I have the picture of the Arctic put up, please? This is 
a picture, I am afraid it is not as visible as I would have 
liked. This is a picture of the current status of the Arctic 
ice cap in September. It is difficult to view, but there is a 
red line showing what the Arctic ice cap used to look like 
before we started dumping millions of tons of carbon dioxide 
into the atmosphere, and what it shows, that the Arctic ice cap 
has now shrunk about 40 percent by mass. Now, several years ago 
thought it was going to disappear in its entirety, and this is 
the air conditioner for the world. This is what controls the 
ambient air, bounces light back, and it is going to disappear. 
Now, scientists thought it was by 2040. Now we think it might 
be within this decade actually being gone.
    Now, my understanding of the status of the science, 
National Science Foundation, National Academy of Science, 
International Panel on Climate Change, 2,500 sciences who sent 
this committee a letter dated a couple days ago saying that 
this science is clear by compelling, cogent and consistent 
evidence in the peer-reviewed literature that we are having an 
impact on climate, visibly in many, many manifestations, this 
being just one of them.
    I have not been able to find--and I understand for 
political purposes people are trying to drum up questions about 
this. I understand politics. But I have not been able to find a 
peer-reviewed scientific study that challenges this finding of 
the consensus of scientists in America, including those who 
work for the United States Navy, and they do a pretty good job 
on our submarines. Is it a fair statement that there is wide, 
wide consensus about the science upon which you have made this 
finding?
    Ms. Jackson. Yes, sir, it is very broad and based on 
multiple lines of research.
    Mr. Inslee. And are you aware of any single peer-reviewed 
scientific journal which has questioned the foundations of the 
relationship between our actions on earth and the increase in 
CO2 in the atmosphere? Because I am not.
    Ms. Jackson. I am not, sir.
    Mr. Inslee. Now, I tell you what, I hear a lot of political 
flacks, I hear a lot of people on television saying the science 
is questionable, but we can't find one single peer-reviewed 
research study that has questioned this science, and I hope the 
people who are distributing information at this hearing will 
point out that the Republican Party that wants to pass this 
Dirty Air Act will not produce one single peer-reviewed 
scientific piece of literature which questions the finding of 
the Environmental Protection Agency. I think that is pretty 
stunning that they want to put our kids' health at risk and 
won't produce one peer-reviewed piece of research to support 
their conclusion.
    One last question on the economy. In fact, the research has 
shown that we increase our economy by a factor of three or four 
every time we make an investment under the Clean Air Act, and I 
want to put in the record, and you made reference to this. It 
is a study by industry and institutional investors. It is 
called New Jobs, Cleaner Air, and it finds as a result of your 
proposal, there will be an estimated job gain in Illinois of 
122,695 jobs associated with the new construction jobs, the new 
scientific jobs, the new jobs in utilities associated with 
making the air cleaner. Is it a fair thing to believe that as 
we make our air cleaner, we can grow our economy?
    Ms. Jackson. Yes, sir.
    Mr. Inslee. Thank you.
    Mr. Whitfield. I recognize the gentleman from Oklahoma, Mr. 
Sullivan.
    Mr. Sullivan. Thank you, Mr. Chairman, for holding this 
hearing. I would like to state that this hearing is not about 
science, it is about the destructive economic impacts of the 
EPA trying to use the Clean Air Act for what it was never 
designed to do: regulate greenhouse gases.
    Administrator Jackson, thank you for being here today. I 
have several companies my district ranging from chemical 
companies, manufacturing, energy companies, and they are scared 
to death of the EPA's pending rules on greenhouse gas. The 
energy industry in my State employs over 320,000 workers, and I 
intend to see that number grow by vigorously supporting this 
legislation. The Oklahoma Farm Bureau is also concerned with 
the GHG rule as they are the second largest industry in my 
State. Heck, Administrator Jackson, I even have churches that 
are concerned about this.
    You have been petitioned to set GHG standards for 
agriculture emissions. Do you intend to act on this?
    Ms. Jackson. Sir, as I stated earlier, there are no 
agricultural sources subject to EPA's mandatory reporting rule 
and no agricultural sources that need to address greenhouse gas 
emissions in Clean Air Act permits before July of 2013.
    Mr. Sullivan. So that would be no, just no?
    Ms. Jackson. Yes.
    Mr. Sullivan. Has EPA done an analysis on how much 
greenhouse gas regulations will impact the cost of producing 
food on farms and the price that American families will have to 
pay at the grocery store? We have a lot of people concerned 
that spend a lot of their money on groceries, you are taxing 
the food they eat that keeps them alive.
    Ms. Jackson. Sir, I just mentioned that we are not going to 
be regulating agricultural sources. They are not even subject 
to our mandatory reporting rule for greenhouse gases.
    Mr. Sullivan. But did you do any analysis on how it would 
affect the price of food at all? You don't do any of that, huh?
    Ms. Jackson. No, sir. When we analyze our regulations or, 
for example, as we analyzed legislation pending before this 
committee last year, we analyzed changes in potential energy 
costs, and of course its impact on the economy.
    Mr. Sullivan. Do you think it would be a good idea to 
require an economic analysis on how these rules impact family 
farms and the price of groceries? Is it that you don't know 
what the total economic impacts will be on the agricultural 
sector? All tolled, 17,000 farms nationwide are impacted by the 
EPA's greenhouse gas regulations.
    Ms. Jackson. Sir, we will do economic analysis of 
regulations as they are proposed and finalized. That is a 
process required under the Clean Air Act already.
    Mr. Sullivan. I am concerned that we have no idea what the 
avalanche of greenhouse gas rules will cost, costs that could 
shift and shatter the economy. The Obama Administration has 
come out recently with an initiative for regulatory reform 
seeking to be more business-friendly, stating that our 
regulatory system must take into account benefits and costs. On 
paper, we agree. Has the EPA done an analysis of what the full 
costs of regulating greenhouse gas under the Clean Air Act will 
be?
    Ms. Jackson. We do regular analyses, and of course, we will 
be complying with the Executive Order to do a cumulative review 
of all of our regulations. Under the Clean Air Act, we know 
that the benefits to costs of the Clean Air Act are 30 to 40 to 
one cumulatively, and in the regulations recently proposed are 
oftentimes at least double if not an order or two of magnitude 
higher. The benefits are higher than the cost.
    Mr. Sullivan. So you will be doing analysis. When will you 
be doing it? Do you know?
    Ms. Jackson. We will do economic analysis as part of the 
rulemaking process, sir.
    Mr. Sullivan. Has the EPA looked at the impact on jobs?
    Ms. Jackson. Yes. Just yesterday EPA put out a White Paper 
in response to a question from a member of this committee on 
jobs and the Clean Air Act, and it confirms that which we heard 
earlier today which is that having regulatory certainty allows 
businesses to innovate and give us clean air and grow our 
economy at the same time. That is the history and legacy of the 
Clean Air Act, sir. It is a very powerful piece of legislation.
    Mr. Sullivan. Have you looked at the risk of manufacturing 
jobs overseas? I hear that all the time, that people are going 
to do it if this happens. Do you look at that?
    Ms. Jackson. We do do an economic and jobs impacts analysis 
on regulations as part of the regulatory process, sir.
    Mr. Sullivan. But you haven't done that yet?
    Ms. Jackson. We do them for the regulations as they come 
out so----
    Mr. Sullivan. When will you be doing it?
    Ms. Jackson. The regulations are proposed for, for example, 
new source performance standards, we will do analysis as part 
of the regulatory process.
    Mr. Sullivan. Thank you. I yield back.
    Mr. Rush. Mr. Chairman?
    Mr. Whitfield. Yes?
    Mr. Rush. I respectfully request that the White Paper that 
the Secretary mentioned be entered into the record.
    Mr. Whitfield. Without objection.
    [The information appears at the conclusion of the hearing.]
    Mr. Whitfield. I recognize at this time Mr. Markey of 
Massachusetts.
    Mr. Markey. I thank the gentleman.
    This bill that we are considering, the Polluters Protection 
Act of 2011, repeals the scientific finding that global warming 
pollution is dangerous. It ties EPA's hands and prevents it 
from moving forward with any regulations to reduce global 
warming pollution. It even prevents EPA from thinking about 
global warming pollution as part of its other duties under the 
Clean Air Act. In George Orwell's 1984, Big Brother's faceless 
minions at the Ministry of Truth dispose of politically 
inconvenient facts by pitching them down a memory hole. Today, 
Big Oil and Big Coal have been working with the Republican 
thought police to comb through each and every reference to 
global warming pollution in the Clean Air Act and then 
disappear them, sending scientific consensus down the memory 
hole at the expense of public health and welfare. But their 
bill will create new jobs. The oil and the goal and the utility 
lobbyists who are here today and watching on the Web all across 
America, there are new people being hired in those industries 
to make sure that the EPA cannot do its job, and we 
congratulate you for that purpose.
    But what this bill also does is to bar EPA from doing 
anything further to reduce oil from cars, trucks, planes, boats 
or other sources. The legislation might even nullify the 
progress we have already made over at EPA in reducing demand 
for oil. The Republican bill could result in an increase in our 
dependence of more than 5 million barrels of oil per day by the 
year 2030, more than we currently import from OPEC. So that is 
what we are doing today. Tomorrow, in this very same 
subcommittee, we are holding a hearing on the impact of Middle 
East unrest and its impact on U.S. energy prices for consumers. 
That is like holding a hearing on repealing FDA's authority to 
regulate tobacco and then holding a hearing the very next day 
on the dangers of tobacco in creating lung cancer. Five million 
barrels of oil per day. At $90 per barrel, that is $164 billion 
a year we would send to OPEC if the Republicans are accurate. 
That would fund al-Qaeda. That would fund Hamas. That would 
fund Hezbollah. That would fund the Muslim Brotherhood. That is 
what this money would be used to accomplish. That is what their 
bill makes possible.
    Now, I understand why Arab oil sheiks and Oklahoma oilmen 
want the price of a barrel to continue to rise and to rise and 
to rise, but the consequences for American young men and women 
that we would have to send over there, the impact on our 
geopolitical status around the world would be devastating. 
Instead of holding the line so that we continue to back out 
that imported oil, the Republicans have offered us a unilateral 
disarmament policy that al-Qaeda and other groups around the 
world will be able to exploit as we send more money over there 
to import oil into our country.
    By repealing the endangerment finding, Republicans are 
endangering the current standards by opening up a litigation 
loophole in the current standards to reduce oil use in cars and 
light trucks, and Republicans are barring EPA from moving 
forward with any new standards at all. Do you agree, Madam 
Administrator, that this legislation would increase our 
dependence on foreign oil if you are prohibited from 
promulgating additional regulations to reduce our dependence 
upon that imported oil?
    Ms. Jackson. Yes, sir.
    Mr. Markey. Doesn't this bill also undermine the renewable 
fuel standards, which is driving the production of homegrown 
biofuels that will further our imports of oil from OPEC by 1.6 
million barrels of oil per day?
    Ms. Jackson. Yes, sir, I believe it does.
    Mr. Markey. Doesn't this bill also prevent EPA from setting 
standards to reduce oil use in trains, boats, planes, large 
trucks and other industrial sources, sources that account for 
almost 40 percent of all oil that we use each day?
    Ms. Jackson. Yes, sir, I believe it would.
    Mr. Markey. So basically what we have here then is 
legislation that is a regulatory relief bill for oilmen in 
Oklahoma and at OPEC that would allow for a tightening of the 
noose around the neck of American foreign policy and consumers 
that will come back to haunt us in years ahead because we did 
not use America's greatest strength, our technological genius, 
to improve the vehicles that we drive, improve the appliances 
which we use, improve the efficiency of the buildings within 
which we live so that we reduce dramatically the amount of 
energy that we have to consume and tell OPEC we don't need 
their oil anymore than we need their sand. That is what this 
hearing is all about and that is why this bill has an historic 
place in terms of its undermining of our national security.
    Mr. Whitfield. The gentleman from Oregon is recognized for 
5 minutes.
    Mr. Walden. Thank you, Mr. Chairman.
    Woody is back in town. I want to talk to you about biomass 
first off. You testified, and the Administration testified in 
support of the Waxman-Markey bill, and I would just like to 
know your scientific underpinning for supporting the provision 
that treated biogenic carbon emissions as if they were oil or 
gas when used in the production of renewable energy.
    Ms. Jackson. Sir, I recently wrote a letter saying that we 
believe that there is only limited climate impact through the 
combustion of certain biomass.
    Mr. Walden. Now, that is interesting because the scientists 
at the State University of New York, College of Environmental 
Science and Forestry contend that woody biomass is a 
substantial CO2-neutral renewable resource that can 
be used as a fuel for a variety of sustainable, environmentally 
sound energy applications. Do you disagree with that finding?
    Ms. Jackson. No, Mr. Walden. What I said is that I 
substantially agree that we need additional science because it 
may well be that many sources of biomass are neutral when it 
comes to greenhouse gas emissions.
    Mr. Walden. Do you think that there is a difference between 
woody biomass that is used for renewable energy that is 
produced on private, State or county land versus that comes off 
federal land?
    Ms. Jackson. Sir, I don't know what the difference would be 
except its source, and it would depend on the type of biomass.
    Mr. Walden. But if it were the same tree source, right? If 
you have a fir tree on one side of the line----
    Ms. Jackson. Scientifically, there is no difference on 
whose land the trees are.
    Mr. Walden. Right. So that is what perplexed me about your 
support for the Waxman-Markey bill that said woody biomass off 
federal land was different than the woody biomass off other 
lands when treated--when used to create renewable energy. It is 
a flaw.
    Now, in your tailoring rule--people in my district are real 
upset because there are a lot of rules, not just this one but 
others coming out that do affect the price of oil. I understand 
your agency just pulled the air permit on a Shell drilling 
operating Alaska that would have potentially reached into 35 
billion barrels of oil. They have gone through 35 other 
permits. That one has been pulled. If you want to talk about 
accessing America's great energy reserves, didn't you pull that 
air permit?
    Ms. Jackson. No, sir, actually we issued the permit. The 
courts--the Environmental Appeals Board ruled against the EPA-
issued permit, sir.
    Mr. Walden. So what is your plan going forward there?
    Ms. Jackson. We have a motion to the Environmental Appeals 
Board for reconsideration, and we are working with the permit 
applicant to perfect the application and move forward as 
quickly as we can in response to the application.
    Mr. Waxman. Will the gentleman yield?
    Mr. Walden. No, I won't. I only have a minute ten, Mr. 
Chairman. Otherwise I would.
    Let us go back to the biomass issue because in the--a lot 
of us wrote you in a bipartisan way asking you to not move 
forward with the rule on biomass in the tailoring rules 
affecting biomass. You responded and said you are going to 
delay this for a couple of years. Now, the practical impact in 
a district like mine is, we have got a lot of people that want 
to invest in new high-tech biomass facilities, to turn woody 
biomass into renewable energy. They are concerned that you are 
going to come back in 2013 or later on with a rule that treats 
biomass as if it were coal or oil. Can you give us any 
indication that you won't do that?
    Ms. Jackson. I do know, sir, that the American Forest 
Products Association hailed the decision to defer for 3 years--
--
    Mr. Walden. I am aware----
    Ms. Jackson [continuing]. To get the science, like the 
science you mentioned, to show the carbon neutrality of biomass 
fuel.
    Mr. Walden. But I want to get to my question. I know what 
they said. I know what I said. I was glad except I think we 
create this delay process where you are stifling investment. 
The President wants to see $2 trillion in private sector 
investment come off the shelves and get invested. It is rules 
like this that are causing the people trying to make those 
decisions to wait because they don't know what your agency is 
going to do in a couple of years that might affect them if they 
make that investment today. Because you could go back under the 
new source performance standards, could you not, and say no, 
actually we are going to regulate the burning of woody biomass 
as if it were----
    Ms. Jackson. I support the delay to get the best science, 
sir, to give scientists a chance to do the studies to determine 
how best to deal with biomass and to determine whether all 
biomass is created the same. It was a delay to review 
scientific----
    Mr. Walden. So you can't give us any certainty. So we are 
on delay for a couple years?
    Mr. Waxman. Mr. Chairman, I would ask unanimous consent 
that I be given 30 seconds to make a statement for the record.
    Mr. Whitfield. Does anybody object?
    Mr. Waxman. I just wanted to point out to the gentleman 
from Oregon that his criticism of our bill would have applied 
to its initial formulation, but by the time we passed the House 
floor, the biomass provisions were changed, and I think even in 
Oregon the industry was for it. But your criticism was of the 
draft bill that was in the committee, not the bill that passed.
    Mr. Walden. Well, Mr. Chairman, if I might respond to that?
    Mr. Waxman. I would be happy to yield.
    Mr. Walden. Indeed, there was criticism of the original 
language. However, the language that was adopted by this 
committee still left a real problem when you accept--if you go 
to section 15, I believe it is, and the new language still 
precludes material that would come off all kinds of federal 
lands--roadless areas, old growth, late successional stands--
except for dead, severely damaged or badly infested trees. 
Those definitions, those were never defined. I had Forest 
Service employees ask me what is a severely damaged tree, what 
is a badly infested tree, because they said we are the ones who 
are going to get sued because--and so it still is not workable 
language in the real forest.
    Mr. Waxman. We thought we had corrected the problem. I just 
wanted to make that point.
    Mr. Whitfield. Ms. Jackson, maybe we will have you back and 
we will talk about woody biomass in detail, at length.
    This time I will recognize Ms. Capps of California.
    Ms. Capps. Thank you. Before I get to my questions, I ask 
unanimous consent to place into the record a letter, and it is 
signed by more than 1,800 physicians, nurses and other health 
professionals from all 50 States calling upon Congress to, and 
I quote, ``resist any efforts to weaken, delay or block 
progress toward a healthier future for all Americans.''
    Mr. Whitfield. Without objection.
    [The information appears at the conclusion of the hearing.]
    Ms. Capps. Thank you. I also ask unanimous consent to place 
into the record statements from a number of public health 
organizations including the American Lung Association and the 
Trust for Americans' Health rejecting the draft bill under 
consideration today.
    Mr. Whitfield. Without objection.
    [The information appears at the conclusion of the hearing.]
    Ms. Capps. Thank you, Mr. Chairman.
    Administrator Jackson, thank you for your testimony and for 
your patience this morning. I want to talk about the very real 
consequences for our public health, and you know my background 
as a public health nurse, if we do not act to control 
greenhouse gas emissions. One of the best documented impacts of 
climate change is the in ground-level ozone smog 
concentrations. This is a big problem for many of our 
metropolitan and suburban areas. Now, I know you were asked 
about and already talked about some of the harmful effects of 
this carbon pollution on people but can you be more specific or 
give some examples, if you will, from your data collection on 
kids' respiratory health being impacted, the cases of asthma or 
heart problems or cancers?
    Ms. Jackson. EPA's work under the Clean Air Act to address 
smog is directed primarily at reducing ground-level ozone, 
which we know, which science does not dispute, increases the 
risk of asthma attack and premature death for people who have 
lung disease.
    Ms. Capps. Thank you. I know in my years of being a school 
nurse, we saw a dramatic increase in the number of children 
with asthma, which is the case today as well.
    Two years ago when you issued the endangerment finding, you 
considered these effects on human health. They were a part of 
your decision-making process, right?
    Ms. Jackson. Absolutely. The unchecked emissions of 
greenhouse gas emissions would change the climate, thus 
exacerbating the effects of smog on asthmatic children and 
people with lung disease.
    Ms. Capps. Can you please also share with this subcommittee 
some of the other public health research and science that you 
reviewed in making this decision? I know that it was an 
extensive and thorough decision-making process in which you 
didn't ask a few selectively chosen groups, that you went 
broad-based. Maybe we need to know how broad-based your 
research was.
    Ms. Jackson. Yes, it was based on the peer-reviewed work of 
multiple research programs, both public research as well as 
private and academic research. The U.S. Global Change Research 
Program, for example, projects that the impacts we would see in 
America from unchecked carbon dioxide and global warming 
pollution would be tremendous. They would not be limited to 
urban areas. They would not be limited to arid areas. The Great 
Plains would experience more drought and increased infestation 
of pests. That means more disease. The Southeast would 
experience declines in livestock production. The Great Lakes 
would have more frequent spring flooding and more frequent 
drought. That's in addition to the more traditional public 
health impacts to people who oftentimes are least able to 
defend themselves: our children.
    Ms. Capps. Exactly. And, you know, we have heard today 
about the costs of implementation of the EPA and your 
endangerment findings and all the rest, but I have been able to 
make the case, and I wonder if you wouldn't agree, that the 
benefits of the programs that you have implemented really do 
exceed and add greatly to balance over the costs of 
implementation, far and away.
    Ms. Jackson. That is right. We are talking about the Clean 
Air Act today and history. Facts show numerous studies, 30 to 
one, 40 to one, the health benefits for every dollar invested 
in this country in clean air technology.
    Ms. Capps. And finally, as your agency continues to do the 
work that you are doing, you are going to be making decisions 
based on the best public health research and science, I am 
sure, and I just want to make sure that we have, because it is 
in the record now as I have introduced, one quote from the 
letter that these 1,800 health professionals submitted, and 
they say, ``As health and medical professionals, we are keenly 
aware of the health impacts of air pollution.'' Air pollution 
is linked to a wide range of health consequences including 
cancer, asthma attacks, heart attacks and strokes. The Clean 
Air Act guarantees all Americans, especially those most 
vulnerable, that the air be safe and healthy to breathe. 
Despite air pollution reductions, more progress is needed to 
fulfill this promise, and maybe you will close it out with 3 
seconds illustrating that.
    Ms. Jackson. I don't know what better way to say it or from 
a more credible source. I like a recent quote I saw from a 
physician in the Missouri area who said it is just not 
conceivable that we wouldn't our require not to pollute our 
air, not to make our air dirtier and our families less healthy 
in order to increase their profit margins.
    Ms. Capps. Thank you. Thank you, Mr. Chairman. I yield 
back.
    Mr. Whitfield. Thank you. At this time I recognize the 
gentleman, Mr. Terry, 5 minutes.
    Mr. Terry. Thank you, Madam Administrator. Do you like 
puppies?
    Ms. Jackson. Do I like puppies?
    Mr. Terry. Yes.
    Ms. Jackson. Yes, as long as somebody trains them for me, 
but I have a dog.
    Mr. Terry. I just wanted to ask you because I felt like 
joining Mr. Waxman and Mr. Markey in asking you questions.
    Now, could you point to the area where in the Clean Air Act 
it lists--because I have looked at the Clean Air Act and it 
sets out rather lengthy lists of what is covered. So within the 
Clean Air Act, could you point to which section CO2 
is listed?
    Ms. Jackson. That determination was made by the Supreme 
Court, sir.
    Mr. Terry. OK. Let us go to Massachusetts v. EPA. And by 
the way, I want to refute, not refute, but Mr. Inslee read a 
portion of or a paragraph of the Court's decision, 
Massachusetts v. EPA, that recognizes the fact that--I just put 
CO2 into the air and I appreciate that the Supreme 
Court recognized that when I exhale or there is CO2 
emissions. I am not going to comment on any contribution by me 
of methane. That is humor, by the way, Ms. Jackson. Larry the 
Cable Guy is from Nebraska so we have a certain level of humor.
    But here is a compelling part or part of the Massachusetts 
v. EPA that is really the subject of the debate over this issue 
of whether or not the EPA has the power to do this, and I am 
going to read the full paragraph like Mr. Inslee did. It is in 
the order part, and it just says, ``In short, EPA has offered 
no reasoned explanation in its refusal to decide whether 
greenhouse gases cause or contribute to climate change. Its 
action was therefore arbitrary, capricious or otherwise not in 
accordance with law. We need not and do not reach the question 
whether on remand EPA must make an endangerment finding or 
whether the policy concerns can inform EPA's actions in the 
event that it makes such a finding. We only hold that EPA must 
ground its reasons for actions or inaction in the statute.''
    The issue here is whether or not this Administration is 
grabbing power without congressional approval, and I would 
submit to you that the language in Massachusetts v. EPA does 
not say that the EPA has the power to start regulating 
CO2. Science and issues, as Mr. Sullivan from 
Oklahoma, where all evil oil men evidently reside, made the 
point, this isn't a debate about science, this is a debate 
about whether the EPA has authority. Next week we are going to 
do the same thing with the FCC on whether they have 
unilaterally sua sponte performed a power grab without 
congressional authority. So that is what we are here to do 
today. And then I want to get to the Clean Air Act. If the 
Clean Air Act was amended and just added carbon dioxide to the 
section that lists all the pollutants specifically, isn't it--
well, then would you be able to say well, we are only going to 
apply CO2 if there is more than 100,000 tons emitted 
within a calendar year? Would you be able to do that?
    Ms. Jackson. Sir, are you asking about a potential change 
to section 111 of the Clean Air Act?
    Mr. Terry. Well, I will have to look at 111, but the issue 
is that you said earlier in your testimony that the emissions 
that you would regulate would be for CO2 would be 
over 100,000. You said that in answering Mr. Whitfield's 
question.
    Ms. Jackson. Pursuant to the standards under the tailoring 
rule that we----
    Mr. Terry. Under the tailoring rule, but when reading the 
Clean Air Act under what triggers it, it is either 100 or 250 
tons per year, 250 being cited exemptions of which 
CO2 is not or its type of industry, so let us say 
coal industry.
    Ms. Jackson. Right. So the United States Supreme Court, 
whose job it is under the Constitution to interpret our laws, 
ruled on whether or not EPA could ignore its need to make a 
finding----
    Mr. Terry. OK. So since you are saying that the EPA has 
already ignored that Congress didn't give you the authority and 
now you are interpreting they did, that you can just continue 
to interpret----
    Ms. Jackson. I am not interpreting. The United States 
Supreme Court----
    Mr. Terry [continuing]. Different sections saying that 
you----
    Ms. Jackson [continuing]. Ruled that----
    Mr. Terry [continuing]. Are going to redo the standards 
where you are able to regulate, i.e., 100 or 250, and you can 
arbitrarily set it at 100,000 for a coal-fired plant, correct?
    Ms. Jackson. Sir, in an attempt to ensure that we----
    Mr. Terry. OK. You are not going to answer the question.
    Ms. Jackson [continuing]. Minimize the number of----
    Mr. Terry. Thank you for your testimony.
    Ms. Jackson [continuing]. Sources that were regulated, we 
have proposed and summarily adopted after public comment a rule 
that is intended to ensure that only the very largest sources--
--
    Mr. Terry. Madam Administrator, the Clean Air Act does not 
give you that authority.
    Ms. Jackson. The United States Supreme Court says it does.
    Mr. Whitfield. I recognize the gentleman from Texas, Mr. 
Green, 5 minutes.
    Mr. Green. Thank you, Mr. Chairman.
    Welcome, Madam Administrator. I know there is an image here 
that there are only oilmen in Oklahoma. We have a couple in 
Texas and Louisiana and Alabama and Alaska and other places in 
our country.
    My first question was talking about new source performance 
standards, and you have answered that. I guess my concern is 
that there was a consent decree signed but there was no 
economic analysis except during the rulemaking process. It 
seems like we ought to look at that ahead of the rulemaking, 
but I know you have already answered that question.
    My question, though, concerns what happens if only the 
United States acts to reduce these emissions while major 
emitters like China or India, and China may overtake us if they 
haven't already, do not follow suit? Can we really address 
climate change without strong mandatory reductions by other 
major emitters in other countries?
    Ms. Jackson. We will not ultimately be able to change the 
amount of CO2 that is accumulating in the atmosphere 
alone, but that does not mean we should all start at the exact 
same time.
    Mr. Green. I am concerned that the regulations put our 
smaller manufacturers' plants and refineries at an economic 
disadvantage compared to similar industries overseas, a 
disadvantage that several of our witnesses later on will 
outline, and what specifically can your agency do to address 
the concerns of these smaller facilities?
    Ms. Jackson. Well, the tailoring rule which I just 
mentioned was intended to give certainty that those facilities 
would not be subject to regulation. We are talking about 
facilities that emit more than 100,000 tons of CO2 
or its equivalent per year. You get that by burning over a 
railroad car of coal every single day. That is how large these 
facilities are. It was intended to be a reasonable first step, 
to start with the large sources, not with the small ones, and 
to rely heavily on energy efficiency because the belief was 
that if we are going to invest and make ourselves more 
competitive, making ourselves more energy efficient will help 
our bottom line and put more money in the economy for us to 
spend on something besides oil, especially foreign oil, of 
course.
    Mr. Green. Well, I have to admit the hearing today is on 
potential legislation that would actually remove the EPA's 
authority. I think we have to address carbon in our country. I 
just prefer it to be on the legislative level. And we made an 
effort last Congress. We know cap and trade didn't pass during 
a Democrat Congress so it is not going to pass during a 
Republican Congress. But I would like to see Congress take that 
effort and maybe EPA doing it will push us.
    Would you agree that with the measures your agency is 
undertaking in an attempt to curb greenhouse gases, it will 
still be necessary to increase environmentally responsible 
production of domestic natural gas supplies to meet the short-
term carbon reduction goals and keep these manufacturing jobs 
in the United States? Is natural gas part of the solution to 
carbon?
    Ms. Jackson. Natural gas is much less carbon-intense than 
some other forms of fossil fuels, particularly coal, which is 
used for baseload electricity generation in this country. So it 
can certainly be a help, a very useful step in the right 
direction.
    Mr. Green. Well, and I have said it before and I think this 
is something we can agree on across party lines, is that the 
other side is nuclear power. Our country compared to both 
France and Japan is so far behind in utilizing nuclear power, 
but as we know, nuclear power has no carbon emissions except 
for the construction. But natural gas emits 30 percent less 
carbon dioxide than oil does. For our New Englanders who still 
use fuel oil to heat their homes, maybe they need to put a 
pipeline there for the natural gas. But it is 50 percent less 
than coal. So I would hope this Congress would look at 
empowering cleaner burning fuels including the substantial 
expansion of nuclear. We are struggling, as you know, to get 
loan guarantees that were passed in the 2005 energy bill for 
the expansion of nuclear power in our country, yet here we are 
in 2011 and we still don't have it.
    So I share your concern about carbon. I just am concerned 
that we need to do it in a legislative effort so we can do that 
economic analysis from the members, elected members instead of 
the agency.
    With that, Mr. Chairman, I yield back my time.
    Mr. Whitfield. I recognize the gentleman from Texas, Mr. 
Burgess, 5 minutes.
    Dr. Burgess. Thank you, Mr. Chairman.
    Thank you, Administrator Jackson, for being here. I am 
going to ask you a series of, I think, six questions. They are 
detailed and complicated and I know they are going to require 
answers in writing. Some of these I submitted to you before. We 
are still awaiting answers. So what I am interested in this 
morning is getting affirmation that some type of response will 
be coming from your office on these issues.
    Now, north Texas, where I live, last week, a week ago 
today, we were subject to rolling blackouts of electrical 
power. Businesses, schools, hospitals were all affected. This 
was not because of tree branches weighted down by the ice and 
cutting power lines. This was simply an effect of the very cold 
temperatures that were in place in Texas last week. We do all 
recognize there are new regulations coming down the pike, and 
can you assure us here at the subcommittee that these rules 
will not make instances of rolling blackouts more common? We 
would also be interested in the studies that are underway to 
look at the cumulative effect of all of the EPA regulations on 
electrical reliability, not just in Texas where we have our own 
reliability council, but across the country.
    A second area. Did the EPA consult with anyone at Office of 
Management and Budget or the White House before moving forward 
in taking over the Texas flexible permitting program under the 
Clean Air Act? The EPA is now issuing its own permits to 
utilities in Texas, displacing the State agencies that have 
been responsible for that historically, the first time to my 
knowledge that the EPA has taken over a State system. And did 
the EPA consult with Office of Management and Budget on 
regulations for the permits it is issuing in lieu of the State-
based permits? And I would be interested in your development of 
that answer in light of President Obama's recent Executive 
Order calling for greater scrutiny of regulations and 
streamlining of problems encountered with bureaucracy so areas 
where you and the EPA have identified regulations for 
streamlining. I would like to have your thoughts on that.
    Gene Green mentioned natural gas. It is a big industry. In 
my part of Texas, there is of course some controversy over the 
production of natural gas and there are issues that are being 
worked out at the federal, State and local level. Still your 
administrator in region 6 has made public statements that he is 
going to be much more actively involved in the regulation of 
this industry. It employs 100,000 in my area of north Texas. So 
my question that I would like for you to provide some insight 
is, are there active discussions within the EPA to take over--
we are talking about the Clean Air Act today but this could 
also involve the Clean Water Act. Is there going to be greater 
involvement at the federal level in these activities and how 
are you going to justify that with the President's call for 
greater streamlining of burdensome regulations?
    The ethanol mandate that was accelerated in December of 
2007--E15 is now, we are told, going to be mandated by the EPA, 
15 percent ethanol. Can you provide us with the testing that 
has been done in both vehicles and small engines utilizing 15 
percent ethanol? Can you provide us with information on the 
testing done to date and the testing methodology that was 
employed? And again, I am particularly interested in older 
engines, cars produced between 2001 and 2007, and the small 
engine--the snow blower, the weed eater and that type of 
activity.
    Under Title 42 of the United States Code, the section for 
the Department of Health and Human Services, it does allow for 
increased salaries for limited positions requiring specialized 
expertise, and I get that and that is not necessarily a bad 
thing, but it appears that EPA is also utilizing some of those 
42 exemptions. Can you provide for the committee how many EPA 
employees are receiving pay under Title 42 exceptions? Have you 
placed a limit of pay under Title 42 and what is the total 
amount of the Title 42 program costing the federal taxpayer 
within the Environmental Protection Agency's budget?
    Now, this last question, perhaps you can address this while 
we are here today. The Business Roundtable in June of this year 
under the President's request submitted to the President some 
issues that they thought might help in job creation because 
this was an issue last June that the President was concerned 
about, and the Roundtable specifically mentioned the 
Environmental Protection Agency's moves against Texas flexible 
permitting program as one of the major examples of the 
Administration's hostility--their words--towards growth. So 6 
months, what has your office, Office of Management and Budget, 
the White House done in response to the Business Roundtable's 
suggestion to remove the EPA's restrictions on the Texas 
flexible permitting program?
    Ms. Jackson. Sir, I will answer all the other questions in 
writing for the record, and I am happy to do that. I just want 
to point out one important fact. It was the Bush EPA, the Bush 
Administration that found out that under the Clean Air Act the 
Texas flexible permitting program was not legal. So when I 
became Administrator, I found a situation where businesses in 
Texas have no certainty that the permits they have protect them 
from lawsuits for emitting excessive pollution. We have worked 
individually with businesses in Texas to bring their permits 
into compliance with the law and that process will take some 
amount of time. But the answer certainly could not have been to 
look the other way as these businesses got permits that weren't 
worth the paper they were printed on.
    Dr. Burgess. If I may point out in the Business Roundtable 
report prepared for the President, similar rules exist in other 
States which have not been challenged by the EPA. This appears 
to be Texas specific, and if it is, that is wrong and I would 
like you to look into it, and I will await your answers. Thank 
you.
    Mr. Whitfield. At this time I recognize Mr. Engel from New 
York for 5 minutes.
    Mr. Engel. Thank you very much, Mr. Chairman.
    As my colleagues have discussed, this legislation would 
repeal EPA's scientific determination that greenhouse gases 
threaten public health and welfare, known as the endangerment 
finding. I happen to believe that carbon emissions are a 
serious threat to our Nation's welfare. I mean, I know that 
some of us might wish that the earth is flat, and I understand 
that different districts have different needs, I understand my 
colleagues trying to protect industry in their districts, but 
the bottom line is, this is scientific research. This is 
proven, and we have decisions and we are supposed to abide by 
them.
    Ms. Jackson, let me first of all thank you for the 
excellent job that you are doing, and your testimony here this 
morning has just affirmed in my mind what a grasp you have of 
the issues, how determined you are to be on the right track, 
and I just want to thank you for your good work.
    Legislatively repealing that scientific determination 
directly conflicts with the consensus of climate scientists, 
including President Bush's EPA Administrator, Stephen Johnson, 
and the world's most authoritative scientific organizations 
which use words like ``indisputable'' and ``unequivocal.'' We 
talk about it killing jobs. Well, this is an interesting 
statistic. Since its adoption, the Clean Air Act has reduced 
key air pollutants by 60 percent while at the same time the 
economy grew by over 200 percent. So I don't think that that 
shows that jobs are being killed. From 1990 to 2008 alone, the 
Clean Air Act reduced key air pollutants by over 400 percent, 
and the economy grew by almost 65 percent. These pollution 
reductions save lives, improve health, particularly among 
children and seniors, and in 2010 alone, last year, according 
to a peer-reviewed EPA analysis, the Clean Air Act prevented 
over 160,000 premature deaths, 130,000 cases of heart disease, 
1.7 million asthma attacks, 86,000 hospital admissions and 
millions of respiratory illnesses. So I wanted just to state 
that for the record.
    I would like to explore with you, Madam Administrator, one 
question on the impacts of this legislation on the renewable 
fuel standard. As you know, in order to promote renewable fuels 
and reduce greenhouse gas pollution, Congress has required EPA 
to issue regulations to ensure that transportation fuels sold 
in the United States contain certain volumes of renewable fuel: 
advanced biofuel, cellulosic biofuel and biomass-based diesel. 
The volume of each type of fuel is established annually by the 
EPA and based in part of the availability of the fuel. Now, it 
appears to me that the new section 330(b)(1)(A) would prevent 
the EPA from establishing these required annual volumes in 
subsequent years because it prohibits EPA from taking actions 
related to greenhouse gases. Do you have the same 
interpretation that I do of section 330(b)1)(A), and if so, 
what do you think that means for the renewable fuel standards 
specifically and the future of biofuels generally in the United 
States?
    Ms. Jackson. Sir, as I said in my opening statement, I 
believe the draft bill would likely prohibit EPA from taking 
further actions to implement the renewable fuels program in the 
United States.
    Mr. Engel. Well, I think that that is something that is 
really, really important and we really need to think twice 
before we want to do such a thing. I mean, I think that nobody 
at this point should conclude that carbon emissions are not a 
serious threat to our Nation. I mean, they are, and we ought to 
not put our heads in the sand. We ought to figure out a way 
where we can have cleaner air and at the same time have the 
least impact on business and creation of jobs but we shouldn't 
eliminate all these restrictions just because we are concerned 
about these things with jobs. We don't want our children to 
breathe filthy air. We don't want it to go back to the bad old 
days. There are countries all around the world where literally 
people, the cancer rates are up because they don't have the 
rules that we have adopted to prevent these things, and I don't 
think we want to go back to the Stone Age.
    So I thank you for your testimony, and I look forward 
continuing to work with you, and I yield back, Mr. Chairman. 
Thank you, Mr. Chairman.
    Mr. Whitfield. A number of people have mentioned this 
renewable fuels issue, and as we move forward with this 
legislation, we are certainly going to try to address some of 
the concerns that you all have brought about it.
    At this time I recognize the gentleman from Louisiana, Mr. 
Scalise, for 5 minutes.
    Mr. Scalise. Thank you, Mr. Chairman, and welcome back, Ms. 
Jackson.
    Ms. Jackson. Thank you.
    Mr. Scalise. I appreciate you coming to testify. And of 
course, today's hearing is specifically focused on the Energy 
Tax Prevention Act and especially its impact on jobs and how if 
we are able to prevent, truly prevent your agency from going 
into an area where it hadn't been before, we would also be able 
to save thousands of American jobs, potentially millions of 
American jobs along with billions of investment.
    First I want to go back to some comments and statements 
that the President made when he was a candidate. President 
Obama on multiple occasions has talked about cap and trade and 
this kind of regulatory scheme increasing the cost of 
electricity, and I will read one of his quotes. ``Under my plan 
of a cap-and-trade system, electricity rates would necessarily 
skyrocket.'' That was then-Senator Obama as a candidate for 
president. Do you agree with that statement?
    Ms. Jackson. No, sir. I think that statement is----
    Mr. Scalise. You disagree with the President's statement 
that a cap-and-trade scheme would necessarily----
    Ms. Jackson. I believe his larger point was that a market-
based program could ensure that energy rates while producers 
had the certainty they needed to move forward, the market 
through innovation would allow it to happen in a gradual 
fashion.
    Mr. Scalise. A gradual fashion where electricity rates 
skyrocketed, though. That is the key point. The President said 
this. I am not saying this. I will give you Tim Geithner's 
statement. Tim Geithner said cap and trade would increase the 
cost of energy. Do you agree with that statement? Yes or no.
    Ms. Jackson. Controlling pollution is not free.
    Mr. Scalise. It is a yes or no question. Tim Geithner made 
the statement, President Obama made the statement.
    Ms. Jackson. Sir, I don't know what cap and trade you are 
asking me to speculate about. We are here to talk about the 
Clean Air Act and----
    Mr. Scalise. We are talking about the regulatory scheme 
that your agency is currently undergoing that is costing jobs--
--
    Ms. Jackson. No, that is not true. There is no cap-and-
trade scheme----
    Mr. Scalise [continuing]. And the effects it would have on 
electricity rates.
    Ms. Jackson [continuing]. Planned or provided----
    Mr. Scalise. Do you think that this wouldn't have----
    Ms. Jackson [continuing]. For in the Clean Air Act.
    Mr. Scalise [continuing]. Any impact on electricity rates?
    Ms. Jackson. There is no cap-and-trade scheme provided for 
under the Clean Air Act----
    Mr. Scalise. Your regulatory scheme for greenhouse gases--
--
    Ms. Jackson [continuing]. For greenhouse gases, I should 
say.
    Mr. Scalise [continuing]. Which your agency is currently 
doing. Are you currently doing this?
    Ms. Jackson. What we are doing is----
    Mr. Scalise. Yes or no.
    Ms. Jackson [continuing]. Enforcing the Clean Air Act----
    Mr. Scalise. I hate to put you on the spot. I know Mr. 
Dingell----
    Ms. Jackson [continuing]. To reduce the emissions----
    Mr. Scalise [continuing]. Got a lot of good yes or no 
answers.
    Ms. Jackson [continuing]. Of greenhouse gases.
    Mr. Scalise. I would appreciate the same courtesy to a yes 
or no question.
    Ms. Jackson. Well, no, if you are asking me about cap and 
trade for greenhouse gases because there are no plans for cap 
and trade at EPA, and there are no plans----
    Mr. Scalise. So is it safe to say you disagree with the 
President when the President said when cap and trade would 
increase, skyrocket the cost of electricity?
    Ms. Jackson. Sir, what I do know is that we are not 
planning any cap-and-trade regulations or standards. That is 
not----
    Mr. Scalise. We both have limited time, and I appreciate 
that maybe you want to evade the question. It is a direct 
question. It is a pretty simple question that many in this 
Administration have been comfortable acknowledging. Many in 
business have acknowledged that this would increase the cost on 
families. It seems like for whatever reason you don't want to 
acknowledge it, but if you then go to the next step of 
regulating greenhouse gases, do you think that if you regulate 
greenhouse gases in your agency that it would cost jobs?
    Ms. Jackson. I agree with the President that investing in 
clean energy will make our economy stronger, will help our 
economy----
    Mr. Scalise. And I see you have made statements these 
standards will help American companies and create good jobs. 
The problem is, that flies in the face of what the Nation's 
employers in America are saying about what you are doing, and I 
don't know if there is a parallel universe going on but I will 
point to you a number of companies, and I have conversations as 
I am sure most of my colleagues do. The biggest impediment our 
job creators in this country tell us about is the threat of 
regulations coming from your agency and a few other agencies in 
this Administration as the impediments to creating jobs. So 
maybe you think that these policies will help create jobs.
    I will just read what one of our later panelists is talking 
about in terms of how it is costing American jobs. Nucor, which 
is a plant, a company based in America that is preparing to 
build a major steel plant in Louisiana, in our State, the CEO 
of that company--that is a $2 billion investment that right now 
is going to America hopefully. It was on hold during the whole 
debate on cap and trade. They said, and this is a comment from 
the CEO, ``We are waiting to see what Congress does with global 
warming legislation.'' They were holding back on a $2 billion 
investment. And then I will go on to say what the testimony 
that the environmental manager of the company who is here today 
is talking about. He said, ``But this project is not as large 
as the $2 billion investment we initially intended due to the 
uncertainty created by these regulations.'' He is talking about 
your department, the uncertainty created by these regulations. 
``We made the difficult decision to delay the $2 billion 
investment also delaying the creation of 2,000 construction 
jobs and 500 permanent jobs that average $75,000 a year. Now, 
this is a company.
    Ms. Jackson. Sir, respectfully----
    Mr. Scalise. This isn't theory.
    Ms. Jackson [continuing]. Based on EPA----
    Mr. Scalise. Do you recognize that----
    Ms. Jackson [continuing]. The proposed Nucor iron and steel 
facility in Louisiana has actually received the first-ever 
State-issued Clean Air Act construction permits----
    Mr. Scalise. Do you recognize that that costs jobs?
    Ms. Jackson [continuing]. That will require control for 
greenhouse gases. They are a permitted facility----
    Mr. Scalise. And they said they haven't created as many 
jobs----
    Ms. Jackson [continuing]. For greenhouse gases, so that 
would seem to be----
    Mr. Scalise [continuing]. Because of your agency, and I 
just want to talk about that.
    Ms. Jackson [continuing]. Exactly the opposite of them 
being held up. They have----
    Mr. Scalise. But finally, you made a statement about 
Katrina and flooding. You tried, to I guess, infer that 
flooding----
    Mr. Waxman. Point of order, Mr. Chairman.
    Mr. Scalise [continuing]. Was related to----
    Mr. Waxman. Point of order, Mr. Chairman.
    Mr. Scalise [continuing]. Greenhouse gases.
    Mr. Waxman. Point of order.
    Mr. Scalise. I just want to point out the failure of the--
--
    Mr. Waxman. Point of order, Mr. Chairman.
    Mr. Whitfield. Hold on just one minute. OK, Mr. Waxman, you 
had a point of order.
    Mr. Waxman. Look, she was asked a question. The gentleman's 
time has expired. She ought to be able to answer it.
    Mr. Scalise. I asked her to answer yes or no, and she 
refused to answer a yes or no question multiple times.
    Mr. Whitfield. I think that----
    Mr. Scalise. She did it for Mr. Dingell. I appreciate that. 
I just would like the same courtesy.
    Mr. Whitfield. Are you going to have any questions that you 
are going to submit to her in writing?
    Mr. Scalise. I will be happy to submit in writing the 
remaining questions, especially as it relates to the comment 
you made about flooding having an attribution to greenhouse 
gases as opposed to the federal levies in New Orleans, which I 
know you are aware was the real cause of flooding.
    Ms. Jackson. Let me be clear because this is my hometown. I 
did not say that Katrina was due to greenhouse gas emissions.
    Mr. Whitfield. OK. At this time I recognize----
    Mr. Scalise. Thank you.
    Ms. Jackson. I said it was horrible flooding----
    Mr. Whitfield [continuing]. Mr. Doyle for 5 minutes.
    Ms. Jackson [continuing]. Impacted that area in a way that 
is tragic.
    Mr. Whitfield. Mr. Doyle, 5 minutes.
    Mr. Doyle. Thank you, Mr. Chairman.
    Administrator Jackson, welcome, and thank you for your 
patience today. As most members of this committee know, I have 
long been concerned about manmade climate change and how it 
affects our climate, but this committee also knows how 
concerned I am that as we make efforts to address this serious 
problem that we don't harm the competitiveness of American 
industry. During the comprehensive energy legislation that the 
House considered and passed last year, I introduced amendments 
to safeguard many of our industries from some of the effects of 
the bill because we are concerned that this not result in jobs 
being shipped overseas, and if I thought that was what was 
going to happen, I would be very concerned too.
    You know, initially many of us were concerned because the 
Clean Air Act had the potential to require numerous sources to 
obtain permits for greenhouse gas emissions, but EPA acted 
promptly and effectively to issue a tailoring rule and limit 
these requirements only to the largest sources. Administrator 
Jackson, could you just briefly explain what that tailoring 
rule did?
    Ms. Jackson. The potential universe of sources could have 
been 6 million. The tailoring rule took it down to a universe 
no larger than about 15,000 potential, but since you are only 
regulated if you are building a new facility or substantially 
increasing your emissions, we expect that there are a couple 
hundred additional permits that would be required a year, but 
that was intended to be a deregulatory action.
    Mr. Doyle. So does this rule affect every large facility?
    Ms. Jackson. It will only affect very, very large 
facilities, those that emit more than 100,000 tons a year and 
only if they are new, or 75,000 tons a year if they are going 
to have a significant increase in their greenhouse gas 
emissions.
    Mr. Doyle. So right now if you are an existing factory or 
steel mill and you don't expand or increase your greenhouse gas 
emissions by a significant amount, you don't need to spend any 
capital or labor on controlling your greenhouse gas emissions. 
Is that correct?
    Ms. Jackson. That is right, sir.
    Mr. Doyle. So let us say a steel company or other 
manufacturer does want to build out on an existing facility or 
bring an entirely new one online. What do they actually have to 
do? Have you issued guidance on this to let sources know the 
rules of the road?
    Ms. Jackson. Yes, we have issued that guidance, primarily 
for States, who are the permitting authorities, and they are 
implementing it. As you heard, Louisiana just recently 
implemented it to issue a permit there.
    Mr. Doyle. So the permitting authority then basically 
selects the best available control technology through whatever 
options there are. Is it your statement that I heard earlier 
that in most cases the best available technology for reducing 
greenhouse gas emissions is likely to be efficiency?
    Ms. Jackson. That is right.
    Mr. Doyle. So to be clear, you expect that almost all new 
sources, the main thing they are going to have to do is just 
become more energy efficient?
    Ms. Jackson. That is right.
    Mr. Doyle. So couldn't that actually save money over time 
as sources have fewer inputs and reduce their energy use?
    Ms. Jackson. Absolutely. It could increase the profits 
because you costs are lower going forward.
    Mr. Doyle. Yes, I mean, it just seems to make sense to me 
that when we build new facilities, they should be efficient, 
and I think that is something that industry is striving for 
because they realize it is good for their bottom line, and it 
certainly doesn't appear that it would be too costly or drive 
new facilities overseas.
    But the other concern we have is, what if it takes too long 
for new facilities to get permits? Now, that could have cost 
implications even if the requirements are reasonable. So 
Administrator Jackson, what is the EPA doing to help ensure 
that these requirements don't lead to permitting delays?
    Ms. Jackson. The reason we got the guidance out to the 
State permitting authorities earlier is so that there would be 
no time lapse between when these requirements took effect on 
January 2nd and when people would be applying for and need 
these permits, and so EPA is offering technical assistance and 
guidance to step in for those States, and there are several who 
for whatever set of rules or legal obligations back home are 
not yet ready to implement the permitting requirements for 
greenhouse gases. But almost all States are moving in that 
direction. Many have already gotten to that point.
    Mr. Doyle. Now, the Upton bill here aims to stop you from 
issuing minimum standards for the two largest sources of 
greenhouse gas emissions, fossil fuel-powered plants and oil 
refineries. Is EPA currently developing minimum standards for 
any other sectors of the economy such as manufacturers?
    Ms. Jackson. No, sir.
    Mr. Doyle. OK. Thank you, Administrator Jackson. I am 
acutely aware of the challenges that our manufacturers are 
facing today, and I have to tell you that I was skeptical at 
first when investigating how this Clean Air Act would be used 
to regulate greenhouse gases, but it seems to me that when you 
strip away the rhetoric and the scare attacks that the approach 
and the scare tactics that the approach that you are taking to 
date seems extremely reasonable. We know our manufacturers are 
facing tough challenges but I really don't see how repealing 
the Clean Air Act authority for greenhouse gases would help 
them in any way. In fact, the legal uncertainties actually make 
things a little bit worse.
    Mr. Chairman----
    Mr. Markey. Would the gentleman yield briefly?
    Mr. Doyle. Well, if I can, I will.
    Mr. Whitfield. His time is expired and we have a lot of 
witnesses, so Mr. Olson from Texas, you are recognized for 5 
minutes.
    Mr. Olson. Thank you, Mr. Chairman, and thank you, 
Administrator Jackson, for coming here today. I am going to 
follow up on some questions from my colleague, Mr. Burgess from 
Texas, about EPA's taking control of the permitting process for 
refineries and power sources in my home State of Texas. This is 
a fundamental change. The feds under the Clean Air Act, the 
feds set the standards and the States and local governments are 
the ones who implement them through the SIPs, and to justify 
this change, EPA says it erred in the original approval of the 
SIP back in 1992, nearly 2 decades ago, three Presidential 
Administrations because the SIP didn't contain the authority to 
regulate greenhouse gases, and that must be corrected. The 
mechanism to establish this correction was unilateral EPA 
authority to correct ``minor technical errors.'' The feds' 
takeover of States' authority to issue permits under the Clean 
Air Act is not a minor error. It is a radical departure from 
existing law, and under the Constitution that is not your job. 
That is our job.
    So the first question I have for you is twofold. Has any 
previous Administration used an error correction to overturn 
State authority to implement its SIP after it has been approved 
for 18 years?
    Ms. Jackson. Sir, I am happy to get you an answer, but 
again, I will point out that it was the previous Administration 
that determined that parts of Texas's permit rules did not meet 
the requirements of the Clean Air Act. It is EPA's job to 
enforce the Clean Air Act and EPA stepped in because if we 
didn't, Texas businesses would not be able to build or expand 
because they could not get a greenhouse gas emission permit in 
the State of Texas that was legal so they would have been 
subject to any number of lawsuits.
    Mr. Olson. Yes, ma'am, but the previous Administration did 
come in with a couple of month deadline for the Texas companies 
to comply. Usually this happens when there is a change in the 
SIP. As I understand it, there is about a 3- to 4-, 5-year 
process for the States to come through and propose what they 
are going to do to EPA. We are given less than a year, less 
than 6 months to do it, and that is something that is on this 
Administration. Is that----
    Ms. Jackson. We would prefer that Texas issue the 
greenhouse gas permits themselves but if Texas refuses to do 
it, as I am sure you will hear from the next witness, then EPA 
is stepping in to do so because the businesses in Texas still 
need permits under the Clean Air Act, sir.
    Mr. Olson. Once again, how is changing the Clean Air Act 
with just using the technical corrections legislation, how is 
that not usurping the legislative branch's authority to pass 
laws and regulate our environment? I mean, why do you get to 
be--under the Constitution, we should be doing that, not the 
EPA. How can you justify that?
    Ms. Jackson. Sir, under the Clean Air Act, EPA's job is to 
enforce the law and ensure that permits are the same all over 
the country, so a business in Texas gets a Clean Air Act 
permit, it is the same as Louisiana next door, and so what EPA 
has done is move in to ensure that just like the Nucor steel 
facility just got a permit from the State of Louisiana, if they 
wanted to build the exact same facility in Texas, they would 
need a permit for greenhouse gases and they cannot get one 
because Texas has refused to consider those permits at this 
time.
    Mr. Olson. Yes, ma'am. Well, there is one other question I 
have for you. Again, we have talked about what is happening in 
my home State and we have talked about, the other side of the 
aisle has been very vocal about scientifically based actions 
here, and I agree with that. We should do this if we are going 
to do it scientifically based. I think the science right now is 
very much in doubt. But the one thing that I am really 
concerned about from the other side of the aisle, at the end of 
the day the argument rests on what five Supreme Court justices 
decided, and that case did not say that you had to regulate 
greenhouse gases. That was not what the decision said. I will 
read from the decision. The Court did find that EPA has the 
authority to regulate carbon dioxide as an air pollutant but 
they said only if the EPA makes a finding of endangerment under 
that provision, section 202(a)(1). And the Court further stated 
that EPA must ground its reasons for action or inaction in the 
statute. So basically they gave you the ball. I guess my 
question to you is, was Massachusetts v. EPA a mandate for the 
EPA to implement global greenhouse gas control or not? Yes or 
no.
    Ms. Jackson. Sir, it was a mandate that we consider the 
science, and that only if we could come up with reasonable 
science, which I do not believe exists, that shows that 
greenhouse gases do not endanger public health and welfare, 
could we ignore it. They said it was arbitrary and capricious 
to simply ignore the science and choose to make no decision. So 
it did give us the ball in that it said we could not stick our 
heads in the sand. We had to, per the law, make a 
determination, and in making that determination, I reviewed our 
Nation's best science by its best scientists and made a finding 
of endangerment.
    Mr. Olson. Basically you have taken something else. It was 
EPA that made that decision, not the Court, and those comments 
here are erroneous. EPA did it, not the United States Supreme 
Court. Thank you for your time.
    Mr. Whitfield. The gentleman from Utah, Mr. Matheson, is 
recognized for 5 minutes.
    Mr. Matheson. Thank you, Mr. Chairman. Thank you, 
Administrator Jackson, for coming today.
    I do think it is important that this subcommittee hold 
hearings on this issue. I think the challenge of climate change 
is real and I think that the legislative branch ought to be 
engaged. I have some concerns about legislation like Chairman 
Upton's draft bill which does disprove the EPA's endangerment 
finding and bans the EPA from regulation greenhouse gas 
emissions. I am concerned because I think it could 
substantially weaken the effectiveness of the Clean Air Act, 
and I think everyone in this room would argue that the Clean 
Air Act over the last few decades has been an undeniable 
success. It has been a success in providing cleaner air and 
contributing to public health interests.
    I also have concerns that the bill overrides the ability of 
the EPA to regulate emissions from motor vehicles, weaken the 
current fuel economy standards for cars and light trucks, which 
is important to reducing our dependence on foreign oil. But I 
do hear from folks in my State who are concerned about the 
implementation of the greenhouse gas regulations and other 
regulations coming down the pike from EPA and the potential 
costs associated with this uncertainty and growing regulatory 
burden, especially as we seek to grow our economy out of this 
economic recession.
    Administrator Jackson, I have heard from our State 
department of environmental quality, and I know you discussed 
this in response to Mr. Doyle's questions, but the Utah DEQ has 
said that despite the best available control technology 
guidance issued to the States last fall, there remains a lot of 
uncertainty over what BACT decisions by States will ultimately 
be accepted by the EPA. In particular, I have been told that 
the BACT is still too vague to provide any certainty to sources 
who are trying to plan for new construction or modifications. 
In his testimony, Mr. Carter with Sandy Cooper also made 
similar remarks. Can you elaborate on how EPA is working with 
States to implement best available control technology?
    Ms. Jackson. Certainly, sir. Through our regional offices, 
we are offering technical assistance as States work through 
permit by permit. This is a permit-by-permit decision under the 
Clean Air Act, and essentially what you do is, you lay out the 
options for controlling greenhouse gases and you look at 
whether they are commercially available, whether they are 
available at reasonable cost and whether they are effective, 
and oftentimes we believe that is going to lead people straight 
to energy efficiency, which is a very much available way and 
certainly cost-effective way to reduce and make a real start on 
reducing greenhouse gases.
    Mr. Matheson. Do you think there is a way to create 
additional certainty or predictability that you can provide to 
State permitting agencies?
    Ms. Jackson. We are certainly happy to try and to continue 
working with Utah and the professionals there.
    Mr. Matheson. Do you believe that your regional offices 
have the necessary resources, whether it is funding or staff, 
to work with the States on implementing these rules?
    Ms. Jackson. We have made it a priority that the 
implementation of these rules for our air staff is priority 
number one, and I do believe, sir, that we have resources 
available to any State that needs them.
    Mr. Matheson. Do you agree with assertions by many in 
industry and the utility sector that permitting uncertainty in 
conjunction with the additional EPA rules coming down the pike 
over the coming months and years is affecting current and 
future investments in plant modifications, upgrades and 
construction?
    Ms. Jackson. I agree that one thing I hear often from 
industry is that they need certainty of regulation. I think the 
clean cars rule and the nationwide standard is a great 
demonstration of how knowing what the road ahead looks like 
from a Clean Air Act perspective has helped them to move 
forward and do what they do best, which is make cars.
    Mr. Matheson. I will ask another question. The EPA has 
already announced the delay in implementation of efficiency 
rules for biomass facilities. Do you anticipate any delays in 
other covered sectors will be announced?
    Ms. Jackson. I have nothing to announce right now, sir. We 
are trying to do what I said, which is move in a series of 
moderate steps that give people lots of warnings so there are 
no surprises about regulations that may come down the pike, and 
what we have announced so far is that the only two sectors that 
we are looking at for additional standard setting are the power 
sector, utilities, and refineries because they account for such 
a large percentage of our Nation's greenhouse gas emissions.
    Mr. Matheson. OK. Thank you, Mr. Chairman. I will yield 
back.
    Mr. Whitfield. I recognize the gentleman from West 
Virginia, Mr. McKinley, for 5 minutes.
    Mr. McKinley. Thank you, Mr. Chairman.
    I am trying to keep most of my questions to yes or no 
answers to the extent you can, and I have got a lot of others 
if you could submit some responses back to those at the 
appropriate time. Last summer, Senator Reid made a remark that 
said coal makes us sick and oil makes us sick. Do you agree 
with that?
    Ms. Jackson. Only in that pollution makes us sick, so if 
they are the source of pollution, then yes, but it is the 
pollution that makes us sick.
    Mr. McKinley. I have heard a lot today about the health 
benefits, and I don't want to diminish those concerns about the 
health benefits, but I have come to Congress 34 days ago with a 
bigger concern that there are 15 million out of work today in 
America, and a lot of it is attributed back to the actions of 
the EPA and some of their activities or overregulation. I am 
seeing in West Virginia a mine shut down that had a permit 3 
years ago. Now 250-some people are out of work. I saw a mine 
just close in Pennsylvania by the EPA action. I have seen the 
issues of water quality in West Virginia and all other States 
east of the Mississippi that are more stringent than bottled 
water you can buy in a supermarket. I have seen fly ash being 
under attack and people using less of it and recycle. I am just 
so concerned that the EPA is, with all due respect, out of 
touch with what is going on in America, and I would like if you 
could please just cite one example of where the EPA has 
collaborated with a major industrial employer and they have 
increased their jobs in a significant way. Can you cite one 
example?
    Ms. Jackson. Yes, sir. The car industry has reduced their 
overall emissions over 40 years while the number of cars on our 
roads has continued to increase as our population got larger, 
and that is because of technological innovation that insisted 
that we not grow their profits at the expense of our health.
    Mr. McKinley. I am looking for one company that you have 
worked with, you collaborated with them and they have increased 
employment.
    Ms. Jackson. Certainly, sir. Any time an industry invests 
in pollution control, they are hiring workers, everything from 
engineers to technicians to people who design and implement and 
put on scrubber so that when you burn coal in a power plant, 
the emissions are clean. All of those jobs are part of the 
legacy----
    Mr. McKinley. The remark you made earlier----
    Ms. Jackson [continuing]. Of the Clean Air Act and EPA's--
--
    Mr. McKinley [continuing]. Madam Administrator, that----
    Ms. Jackson [continuing]. To protect the public health.
    Mr. McKinley [continuing]. There were thousands of 
scientists and physicists across America that support this 
matter but yet there are thousands equally in opposition to 
that, such as physicist Hal Lewis, people within NOAA, people 
within the United Nations' climate control panel. There are 
others that are supporting that and they conveniently seem to 
be ignored in this. Was Hal Lewis wrong when he said this was 
one of the greatest frauds being perpetrated on the people of 
America?
    Ms. Jackson. Well, I do not know Mr. Lewis, sir, but I will 
say that our best scientists in the country have reached a 
consensus, and it is unequivocal, that the science is clear 
that manmade emissions of air pollution and global warming 
gases are changing----
    Mr. McKinley. Anthropogenic global warming----
    Ms. Jackson [continuing]. Our atmosphere.
    Mr. McKinley [continuing]. Is still an issue that the 
scientists are still debating, and you know it and I know it.
    Ms. Jackson. No, I do not agree with that.
    Mr. McKinley. I am an engineer and I----
    Ms. Jackson. I absolutely do not agree with that.
    Mr. McKinley [continuing]. Can tell you, it has not been 
determined.
    Ms. Jackson. I am an engineer as well, and I know to look 
to scientific experts to make decisions like this. I am not an 
expert on the climate so what we have done is look at people 
like the National Academies across----
    Mr. McKinley. Let me go back to a comment that perhaps it 
wasn't worded, because I found the answer a little humorous. It 
said something to the effect that you didn't presume to direct 
Congress how to act, so I am going to maybe--would you favor, 
do you support the idea that Congress may very well want to 
take action to--do they have the right to vote up or down on 
any major EPA regulatory offering?
    Ms. Jackson. Sir, the laws passed that I implement were 
passed by Congress. The Clean Air Act was passed by Congress. 
So I understand and recognize that under the U.S. Constitution 
Congress makes laws and then the executive branch executes the 
laws, absolutely.
    Mr. McKinley. So you would think Congress should have the 
right to approve any regulations before they are implemented?
    Ms. Jackson. No, sir. Congress already has the 
congressional Review Act, which allows it to review every 
regulation that is adopted by not just my agency, so that is 
certainly already the law of the land.
    Mr. McKinley. Ma'am, I will get back with the other 
questions to you. Thank you very much.
    Ms. Jackson. Thank you.
    Mr. Whitfield. The chairman recognizes Mr. Gardner of 
Colorado for 5 minutes.
    Mr. Gardner. Thank you, Administrator Jackson, for your 
time here today. I appreciate your willingness to be here, and 
I too have only been here for 34 days and it continues to amaze 
me how the scare tactics are thrown out as if everybody is 
speaking from the same page but the problem is, they are not, 
and I want to talk a little bit about criteria pollutants 
versus greenhouse gases. I think a lot of the scare tactics 
that we have heard in terms of the health concerns are criteria 
pollutants and greenhouse gas is not a criteria pollutant, and 
I think that is important to recognize, that a lot of the 
health concerns that have been raised here as scare tactics are 
based on criteria pollutants, and this bill does nothing 
dealing with criteria pollutants, the bill that we are 
discussing now.
    I want to follow up another question that some of the other 
members have asked. I met with a CEO of a company in Colorado 
who employs a thousand people directly, 2,000 people 
indirectly, and he mentioned to me at our meeting, this was 
just this past Friday, that he is very concerned about 
regulations because he is worried that the cost and reliability 
of energy and the energy and power infrastructure, he is 
worried about the energy infrastructure and he is worried about 
the ability of our country to continue to produce affordable 
energy for consumers and for businesses, and that being said, I 
believe Chairman Upton asked an earlier question regarding 
whether or not the EPA had done an cost-benefit analysis of the 
impact of EPA regulations. I believe your response was that the 
EPA had not done so because such analysis would have required 
the EPA to reach out to businesses in order to gather 
information regarding the impact of the EPA's regulations. 
Well, isn't that the right thing to be doing is to reach out to 
businesses in terms of the impact of this regulation?
    Ms. Jackson. No, I think that is not an accurate assessment 
of how the conversation went. I am happy to recount it for, it 
is in the record, but what I said was----
    Mr. Gardner. You don't think you ought to be talking to 
American businesses about these regulations first?
    Ms. Jackson. We talk to American businesses all the time, 
and I think that is the way to make smart commonsense 
regulations.
    Mr. Gardner. And so the American business community agrees 
that this regulation is the way to move forward?
    Ms. Jackson. The American business community has commented 
on the regulations as we move forward, and I would say that 
there are varying opinions. We have heard from small businesses 
who support the regulation because they believe it will help 
the clean energy sector. We have heard from several, I think 11 
utility company, who said that this is a commonsense, 
reasonable approach to----
    Mr. Gardner. Have you heard from some----
    Ms. Jackson [continuing]. Help to make them efficient.
    Mr. Gardner [continuing]. That they will lose jobs as a 
result?
    Ms. Jackson. I think all businesses talk about, when I talk 
to them, they want to make sure that they have regulatory 
certainty, and they are worried about their bottom line.
    Mr. Gardner. And they are worried about job losses?
    Ms. Jackson. Certainly I have seen studies----
    Mr. Gardner. Do you think they need to worry about job 
losses?
    Ms. Jackson. I think the President has made it clear that 
jobs are an absolute focus, sir, absolutely. Jobs are our 
absolute focus and we believe the clean energy sector is a 
place to grow jobs----
    Mr. Gardner. But what if they are not in the clean energy 
sector? Should they worry about jobs? I mean, this sounds like 
we are picking winners and losers and saying some jobs are 
better than others.
    Ms. Jackson. I do know this, sir: the Clean Air Act is 
supposed to relieve their minds about pollution in the air that 
might make them and their families sick.
    Mr. Gardner. That is a criteria pollutant, not greenhouse 
gas.
    Ms. Jackson. No, no, no. The endangerment finding makes 
clear that greenhouse gases also endanger public health and 
welfare.
    Mr. Gardner. But I think again we are confusing the issue 
of criteria pollutants and greenhouse gases. You mentioned 
earlier that ag would not be--there would be no imposition on 
agriculture, agricultural sources. I believe you put a timeline 
of 2013 on that. Will there be ag sources put under this rule 
after 2013?
    Ms. Jackson. I can't speculate to that. I have made a 
commitment that there will be no regulations for permitting for 
agricultural sources until July 2013.
    Mr. Gardner. But after that, there may be permitting 
requirements brought into this rule?
    Ms. Jackson. Yes. It is my hope still that Congress will 
look towards legislation at some point.
    Mr. Gardner. And on agriculture, I think it is important 
too when we talk about that agriculture is not affected by 
these rules and jobs in agriculture aren't affected by these 
rules, I want to point out a letter that talked about the cost 
about running a sprinkler for farmers in my district. The 
estimated cost of certain greenhouse gas emission controls 
would cost the farmer in this particular rural electric 
association nearly $2,000 a year per meter. Do you think that 
will affect their ability to hire people and to grow their 
operation?
    Ms. Jackson. Sir, I don't know what you are referring to. I 
am happy to review it, and I am also happy to again state what 
I said before, that as we put these regulations out, they are 
meant to be commonsense moves that in general will rely on 
energy efficiency and other moderate steps that will add up, 
that will get us started in moving towards reducing greenhouse 
gas pollution.
    Mr. Gardner. Do you believe that agriculture is affected by 
increased costs of energy?
    Ms. Jackson. Certainly.
    Mr. Gardner. Do you believe agriculture is impacted by the 
increased cost of fertilizer?
    Ms. Jackson. Certainly, sir.
    Mr. Gardner. Do you believe that these regulations will 
increase the cost of farming equipment?
    Ms. Jackson. No, sir, I don't necessarily believe that 
because I am not sure what regulations we are talking about. We 
have regulations on the board right now, for instance, for cars 
that make clear that they pay for themselves essentially 
because of the savings in fuel. There are tremendous 
opportunities in rural America for the economy to continue to 
grow as it has thrived over the past several years and we are 
not looking to regulate----
    Mr. Gardner. The economy has thrived over the past several 
years?
    Ms. Jackson. Rural America's economy has done fairly well 
as the rest of the country has seen the housing market and 
economy really do poorly.
    Mr. Gardner. Administrator Jackson, I would invite you to 
my district to meet with people who believe the economy has not 
thrived over the past few years.
    Ms. Jackson. I would be happy to do that, sir.
    Mr. Whitfield. I recognize the gentleman from Kansas, Mr. 
Pompeo.
    Mr. Pompeo. Thank you, Mr. Chairman.
    Thank you, Ms. Jackson, for coming today. In the 4th 
district of Kansas, we do lots of things. We have agriculture, 
and we make airplanes, a lot of airplane stuff, manufacturing. 
I came from that industry. The cost of manufacturing has driven 
lots of jobs. We have got unemployment in our aircraft 
manufacturing industry that is enormous, and families are 
hurting. I heard Mr. Waxman and Mr. Markey talk about children. 
I have seen the impacts on families from what the regulatory 
environment that this Administration has put forward has 
caused.
    I want to ask you in response to something you said to Mr. 
Shimkus, a question. You acknowledged the existence of the law 
of supply and demand or the economic principle, and then you 
joked about price elasticity because you wouldn't answer his 
question yes or no about what the price elasticity of something 
was. Tell me what you think the price elasticity of energy is 
as it relates to supply and demand.
    Ms. Jackson. The price----
    Mr. Pompeo. Is it zero? Does energy stay--as you impose 
regulations, does energy cost stay fixed?
    Ms. Jackson. Sir, I want to state here, I have not said 
that there are not potential costs to move to cleaner energy. 
What is at stake is making reasonable decisions on how to move 
to cleaner energy, less-polluting forms of energy but do it in 
a way that does not harm our economy, and I am committed as 
head of the EPA to enforcing and implementing the Clean Air Act 
to protect our public health but doing it in a way that is 
modest and moderate and that is mindful of our economy at the 
same time.
    Mr. Pompeo. I appreciate that. I will tell you that the 
folks that I talk to in the 4th district of Kansas don't 
believe there is anything moderate or modest about the 
proposals that your agency has put forward.
    I will ask you this. You earlier cited statistics that said 
that the benefits of the Clean Air Act have been about 40 to 1.
    Ms. Jackson. That is correct.
    Mr. Pompeo. It would seem to me then if we would just 
appropriate a trillion dollars, we could take out all the 
deficit because we get a 40 to one return on that investment. 
Is that what you are proposing in terms of return on invested 
capital?
    Ms. Jackson. No, sir. What I am trying to propose is that 
for every dollar invested to control pollution and protect 
public health, that is $40 of health costs that the American 
people are avoiding. They are healthier and more productive 
because they don't have to worry about increased asthma attacks 
and premature death as a result of----
    Mr. Pompeo. Right, and if your analysis is therefore right, 
what do we spent on health care a year, we just pick 40 of that 
number and we would invest that amount of money and we would 
solve the health care problem. That is what your analysis 
suggests. Am I misunderstanding something?
    Ms. Jackson. Yes, you are, sir.
    Mr. Pompeo. OK. Help me understand what it is I am 
misunderstanding.
    Ms. Jackson. You are misunderstanding the point that the 
Clean Air Act is a public health statute. It is designed to 
protect the health of Americans through preventive medicine, if 
you will. It removes pollution from the air that causes asthma 
attacks, that causes lung disease, that make us and our 
children----
    Mr. Pompeo. I understand. I have one more question. I want 
to clean up a couple things you said earlier. You spoke to the 
fact that you appreciated regulatory certainty being important, 
and then you just told Mr. Gardner that our agricultural 
community gets something less than 2 years of certainty with 
respect to greenhouse gas regulation. I will tell you that 
their return on invested capital calculations go far past 24 
months, and so I am trying to understand how you can argue that 
you think regulatory certainty is important and yet tell us 
that our agriculture folks in the 4th district get just a 
little less than 24 months before you will chase them too.
    Ms. Jackson. Well, sir, I am not here to tell your 
constituents or anyone else for that matter that greenhouse 
gases are not a problem or are not something that we should be 
addressing as a country. I believe that we should be 
incentivizing and innovating to move to cleaner forms of energy 
and reduce the accumulation of greenhouse gases in our 
atmosphere, and that is something that is out there not because 
I sit in this seat, sir, but because----
    Mr. Pompeo. If you believe----
    Ms. Jackson [continuing]. They are a challenge for our 
country.
    Mr. Pompeo. Fair enough. If you believe that these 
regulations were going to have a net loss of jobs, would this 
change your view of how the EPA ought to proceed?
    Ms. Jackson. Certainly, sir. If I was seeing regulations 
that I thought----
    Mr. Pompeo. Thank you.
    Mr. Whitfield. The gentleman from Virginia, Mr. Griffith, 
is recognized for 5 minutes.
    Mr. Griffith. Thank you, Mr. Chairman.
    Massachusetts v. EPA, last line, the holding, ``We hold 
only that the EPA must ground its reasons for action or 
inaction in the statute.'' Can you tell me where in the statute 
it allows you to create a tailoring rule?
    Ms. Jackson. The tailoring rule is based on our belief that 
the statute does not speak to the fact that there be too many 
sources to regulate all at once. It is an absurd result. That 
is the theory of the law----
    Mr. Griffith. And I don't disagree with you, ma'am.
    Ms. Jackson [continuing]. On which we based the rule.
    Mr. Griffith. It is an absurd result but that is what the 
law says, and isn't it the right of the elected officials, this 
Congress to make that decision and not unelected officials in 
the EPA?
    Ms. Jackson. Sir, the United States Supreme Court held that 
the Clean Air Act----
    Mr. Griffith. You had to do something, but it said you had 
to follow the statute----
    Mr. Rush. Mr. Chairman.
    Mr. Griffith [continuing]. You followed the statute----
    Mr. Rush. Mr. Chairman, Mr. Chairman. We have sat here and 
watched the questions from the members on this subcommittee and 
they ask questions and the witness attempts to answer, and they 
won't allow her the opportunity to complete her answer. So 
would you admonish members to allow the witness to complete her 
answer before they interrupt her?
    Mr. Whitfield. Mr. Rush, thank you for that. These members 
have waited a long time, and you have been very patient to be 
here, but I am going to allow them to continue to ask questions 
and----
    Mr. Rush. And can the witness please answer? She has been 
here for a long time also.
    Mr. Griffith. I will make it a yes or no question. Do you 
believe that EPA should follow law as written or request 
Congress to change it or ask Congress to relieve them of that 
obligation when the result of the law would be an absurd 
result? Yes or no, please.
    Ms. Jackson. I believe EPA should follow the law as 
interpreted by the United States Supreme Court and the rules 
that we have on the books are designed to avoid the absurd 
result. That is the basis for the rulemaking we have made. That 
is the basis for our attempts to be as reasonable as we can.
    Mr. Griffith. In regard to certainty, and I am doing a 
little cleanup too. In regard to certainty, you indicated that 
there were no plans for a cap-and-trade program. How long can 
you give me certainty----
    Ms. Jackson. I should have said for greenhouse gases 
because we have a cap-and-trade for----
    Mr. Griffith. OK. For greenhouse gases cap and trade, you 
said you had no plans, do you have any ability to give the 
businesses, the industries and the folks that produce in my 
district any certainty how long can they count on that?
    Ms. Jackson. They will see proposed rules long before for 
public comment and we have agreed to do industry listening 
sessions to hear from the industries how best they think we 
should approach future regulations. So there will be a 
transparent process. There will be no secrets. I do not believe 
there will ever be a cap-and-trade program authorized under the 
Clean Air Act.
    Mr. Griffith. Thank you. And then let me ask you, when you 
talked about health and safety of the American folks in looking 
at the endangerment ruling, I am wondering if you all looked at 
the fact, because you mentioned something about the heat being 
higher, causing folks to have strokes or heart attacks, etc., 
and I am wondering if you looked at the fact that with the 
electric rates going up, the heating bills going up, fuel oil 
going up, that there are a lot of folks in my district who are 
having a hard time paying for their heat, and what is the 
offset on the other side? Did you look at what is going to cost 
those folks and the danger to their health by not having 
sufficient heat?
    Ms. Jackson. Sir, I am absolutely not asking people to 
freeze to death or be very warm in the summer. I am not sure I 
understand your question.
    Mr. Griffith. Well, you said in your opening statement that 
one of the things that you looked at in making the endangerment 
ruling was the fact that increased heat when folks--if the 
planet warms that folks are going to suffer more disease as a 
result of overheating and heart attacks, I think you mentioned 
heart attacks or strokes. And I am just asking if the counter 
side to that was looked at and the fact that we are going to 
raise the cost for Americans to buy fuel, therefore some of 
them are not going to have sufficient heat to heat their homes.
    Ms. Jackson. The actions we have taken under the greenhouse 
gas regulations are not intended to make less fuel available to 
Americans, sir, so these are commonsense steps that actually in 
the case of the car rule means we will need less oil. They are 
energy efficiency. They are meant to make us get every drop of 
energy we can out of every drop of gasoline or fuel that we 
use. So perhaps I am not understanding. The endangerment 
finding----
    Mr. Griffith. All right. Are you unaware that the 
regulations already imposed and additional regulations that are 
being placed on the power plants of the United States of 
America will make it more difficult to use coal, which is now 
50 percent of our source, and if you eliminate that as a 
source, you are going to raise the cost of electricity, 
therefore making it harder for people to heat their homes.
    Ms. Jackson. We are not intending to eliminate coal as a 
source of fuel. That is not the goal of reducing greenhouse gas 
emissions. What we are saying is that we can use the Clean Air 
Act to make a start in reducing greenhouse gas emissions.
    Mr. Griffith. And I am wondering if you all have looked at 
the possibility that since I believe that you will send a 
number of jobs overseas that the Chinese and the Indians and 
even the Ukrainians are going to use coal from my district and 
other districts around the United States that the impact of 
that is that we actually have more manufacturing in areas where 
they are not doing even the reasonable things that we are doing 
at this point, therefore contributing to the global environment 
additional pollutants in the air which will actually harm 
Americans more than what you believe your actions will solve.
    Ms. Jackson. As I said earlier, sir, changing the future 
with respect to climate change for our planet is going to 
require all nations to do something but I do not believe that 
means that we all therefore must start at the same time. Parts 
of Europe have already started, so clearly it is not----
    Mr. Whitfield. Well, I think everyone has had an 
opportunity to ask questions. Ms. Jackson, we appreciate your 
taking time to be with us. We are going to be having some 
hearings on the air transport rules, new source review, fly 
ash, some other issues, and so we look forward to your coming 
back to have additional discussions with us.
    I know throughout this questioning period with you, a 
number of members said they were going to be submitting written 
questions for you to answer. Who on your staff should we be 
particularly focused on to deal with that issue?
    Ms. Jackson. Well, I always accept correspondence from 
members but the head of my Office of Congressional and 
Intergovernmental relations is David McIntosh, if you would 
prefer to direct your staff towards him.
    Mr. Whitfield. David McIntosh?
    Ms. Jackson. Yes, Mr. Chairman, but I will take any 
questions you have.
    Mr. Whitfield. Well, thank you very much, and at this time 
I would like to call up the third panel, and that is the Hon. 
Greg Abbott, who is Attorney General of the State of Texas; Mr. 
Steve Cousins, Vice President of Lion Oil Company; Mr. Harry 
Alford, President and CEO, National Black Chamber of Commerce; 
Mr. Lonnie Carter, President and CEO of Santee Cooper; Mr. 
Steve Rowlan, General Manager, Environmental Affairs, Nucor 
Corporation; Betsey Blaisdell, Senior Manager of Environmental 
Stewardship, the Timberland Company; and Mr. James Pearce, 
Director of Manufacturing for FMC Corporation.
    OK. I want to thank all of you. You have been very patient 
today, and yet this is an issue of great importance. It has 
significant impact on our country in a lot of different ways, 
so we look forward to the testimony of all of you. Mr. Abbott, 
you are the Attorney General of Texas. We are going to start 
with you. We will recognize you for 5 minutes for your opening 
statement, and then we will go right down the line, and before 
we ask any questions we will have all of you complete your 
opening statements, so Mr. Abbott.

 STATEMENTS OF GREG ABBOTT, ATTORNEY GENERAL, STATE OF TEXAS; 
 HARRY C. ALFORD, PRESIDENT AND CEO, NATIONAL BLACK CHAMBER OF 
COMMERCE; STEVE ROWLAN, GENERAL MANAGER, ENVIRONMENTAL AFFAIRS, 
NUCOR CORPORATION; JAMES PEARCE, DIRECTOR OF MANUFACTURING, FMC 
CORPORATION; STEVE COUSINS, VICE PRESIDENT, LIONS OIL COMPANY; 
LONNIE N. CARTER, PRESIDENT AND CEO, SANTEE COOPER; AND BETSEY 
  BLAISDELL, SENIOR MANAGER OF ENVIRONMENTAL STEWARDSHIP, THE 
                       TIMBERLAND COMPANY

                    STATEMENT OF GREG ABBOTT

    Mr. Abbott. Thank you, Mr. Chairman, for the opportunity to 
appear before this subcommittee. As you noted, my name is Greg 
Abbott and I am the Attorney General of the State of Texas, and 
I want to first point out that in my submitted remarks I have 
more detail about this but Texas has strived to work very 
effectively with the EPA to enforce environmental laws. Texas 
also strives to prevent political before it occurs. Ozone and 
NOx emissions have been on a steady decline in Texas 
since 2000. Texas has installed more wind power than any other 
State and achieved one of the largest declines in greenhouse 
gas emissions of any State in the Nation. Texas remains 
committed to working with the EPA to improve air quality and to 
hold polluters accountable, but Texas cannot support the EPA's 
regulation of greenhouse gases. Texas believes the EPA has 
ignored the plain language of the Clean Air Act, violated 
notice and comment requirements, and attempted to rewrite 
federal laws written by the United States Congress by the 
administrative rulemaking process.
    Texas lodges several challenges to the EPA's regulation of 
greenhouse gases. For now I will try to plug in just three of 
them that reveal legal problems with the EPA's regulations. One 
that you all talked about already a lot this morning is the 
tailoring rule. The Clean Air Act defines in precise numerical 
terms the emission thresholds that trigger permitting 
requirements for stationary sources. The EPA concedes that 
regulation of greenhouse gases at these statutory thresholds 
produce results ``inconsistent with the congressional intent 
concerning the Clean Air Act'' by subjecting thousands of 
schools, churches, farms, small businesses to Clean Air Act 
regulation. These admittedly absurd results indicate that 
greenhouse gases simply are not the kind of substance the Clean 
Air Act was designed to regulate. Well, dissatisfied with 
Congress's clear instructions, the EPA attempted to amend by 
administrative fiat the Clean Air Act. EPA calls the revised 
language its tailoring rule and we believe that the EPA has 
violated the Clean Air Act by its tailoring rule.
    Texas also challenged the EPA's SIP call rule. The Clean 
Air Act empowers the EPA to require States to amend their 
permitting programs by issuing a SIP call. The Act gives States 
up to 3 years to bring their regulatory program into compliance 
with major federal mandates such as the greenhouse gas 
regulations. When the EPA issued the SIP call rule on September 
2, 2010, it gave States just 15 months until December 2, 2011, 
to change their laws and regulations to comply with the new 
greenhouse gas mandate. The EPA shortening the time frame 
violates the Clean Air Act by giving States just 15 months, 
rather than the congressionally mandated 36 months.
    Texas also challenged the EPA's FIP rule. In August 2010, 
we informed the EPA that Texas would not satisfy the EPA's 
greenhouse gas demands. A few months later in late October 
2010, an assistant EPA administrator filed a sworn statement in 
federal court swearing that the EPA could not take over Texas 
air permitting program until December 2, 2011, at the earliest, 
meaning almost 10 months from this very day. Well, despite that 
sworn statement, the EPA did a 180-degree turn on December 23rd 
and issued an emergency FIP rule in an attempt to immediately 
federalize Texas's air permit program. When it suddenly changed 
courses, the EPA not only acted duplicitously, it also violated 
the Administrative Procedures Act, which requires the EPA to 
solicit notice and comment from the public. The EPA's FIP rule, 
however, was issued without notice and comment period at all in 
direct violation of federal law.
    Not only did the FIP rule violate the notice and comment 
required by the APA, it was promulgated just before the 
Christmas and New Year's holidays in an obvious attempt to 
minimize public scrutiny. The EPA had known for more than 4 
months that Texas would not comply with the SIP call rule and 
yet it waited until just before Christmas to announce without 
public comment or notice that a supposed emergency required it 
to seize control of the air permitting system in Texas just 2 
weeks later on January 2, 2011. These are some of the reasons 
why Texas is lodging its legal challenges against the EPA.
    [The prepared statement of Mr. Abbott follows:]

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    Mr. Whitfield. Thank you, Mr. Abbott.
    At this time I recognize Mr. Alford with the Chamber of 
Commerce.

                  STATEMENT OF HARRY C. ALFORD

    Mr. Alford. Chairman Whitfield, Mr. Vice Chairman, 
distinguished members of this committee, thank you for having 
me. I am Harry C. Alford, President and CEO of the National 
Black Chamber of Commerce.
    After failing to persuade the American public of its 
intentions to pass a cap-and-trade program through the 
legislative process, the Obama Administration has now unleashed 
its Environmental Protection Agency to tackle climate change 
with non-transparent, burdensome regulations. This bureaucratic 
zeal is not only disastrous for American consumers and 
businesses at large but also particularly threatening to the 
future of prosperity of black communities.
    The Energy Tax Prevention Act of 2011, introduced by 
Representatives Upton and Whitfield and Senator Inhofe, offers 
our Nation a much-needed reprieve from this EPA overreach and 
it is my hope that both Democrats and Republicans will join 
this new effort to stop the agency's power grab of our domestic 
climate policy. Congress must be in charge of policymaking for 
such a serious issue, one that touches the lives and welfare of 
virtually every American, not unelected officials with zero 
accountability.
    The Act aims to protect American jobs and businesses, 
especially in light of increasing competition from developing 
nations such as China. Again, for the African American business 
community and black workers nationwide, EPA's regulatory 
overreach will kill their competitiveness and innovation and 
impose significant burdens to new employment.
    Back in 1979, manufacturing employment here in America 
reached its high point, providing jobs to roughly 19.6 million 
Americans. Since then, we have lost more than 8 million 
manufacturing jobs. Now, many of the factories that once 
employed our workers here in the United States are now popping 
up in China, Indonesia and other Asian countries.
    When I was a young man, I began my career in Detroit. Upon 
revisiting throughout the years, I can attest to how cumbersome 
government regulations have come to destroy small businesses 
and starve families. EPA's plan to implement emission 
regulations will sadly result in far greater strife. This 
strife will be borne particularly hard by the African American 
labor force, one that has not only been underrepresented in the 
workforce historically but also badly wounded since the 
financial meltdown. Today 16.5 percent of African American men 
and women are out of work and the situation is only getting 
worse. According to a new study by the Economic Policy 
Institute, the black unemployment rate is projected to hit a 
25-year high by the third quarter of this year.
    Additional EPA proposals that have sought to tighten air 
quality standards with regard to ozone exemplified mammoth 
business-destroying implications as well. For instance, the 
National Federation of Independent Business found that as many 
as 675 counties across the United States would violate the 
proposed standards, triggering job-killing mandates, costly 
compliance fees and financial penalties for businesses in those 
areas. Just imagine how businesses would be forced to close and 
how many workers would be laid off if EPA's broader proposal to 
implement a regulatory cap-and-trade scheme is successful.
    Long story short: the environment belongs to everyone. For 
EPA to think that it can use the Clean Air Act to now ram 
through cost-prohibitive climate regulation is something I will 
not stomach and it certainly is not something that the African 
American business community is prepared to accept either. While 
paying a higher heating bill this month or doling out money for 
gasoline on the way into the office from McLean or Bethesda may 
mean little to government bureaucrats, people living paycheck 
to paycheck and small businesses trying to get by simply cannot 
afford it, especially now.
    I applaud all members of the legislature who are working 
hard to make sure that EPA does not enact a cap-and-trade 
scheme and therefore are standing up for not only America's 
economic future but also for the well-being of our Nation's 
African American community specifically.
    Again, thank you for this opportunity to testify here this 
morning on the important of the Energy Tax Prevention Act and 
halting EPA's regulatory overreach. I look forward to answering 
any questions you may have.
    [The prepared statement of Mr. Alford follows:]

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    Mr. Whitfield. Thank you, Mr. Alford.
    Mr. Rowlan with Nucor Corporation, you are recognized for 5 
minutes.

                   STATEMENT OF STEVE ROWLAN

    Mr. Rowlan. Thank you. I am Steve Rowlan, General Manager 
of Environmental Affairs for Nucor Corporation. Thank you, 
Chairman Whitfield and Vice Chairman Sullivan, for this 
invitation to testify today on the impact of greenhouse gas 
regulations on our industry and other industries in our 
Nation's economy.
    Nucor is the largest steel producer and recycler in the 
United States. We employ over 20,000 teammates in 23 States and 
produce steel products for use in road, bridges, automobiles, 
appliances, buildings and a range of other markets.
    The impact of the great recession on the steel industry was 
swift and severe. In August of 2008, steel capacity utilization 
was over 90 percent. By January 2009, capacity utilization had 
plummeted to 36 percent. In a mere 5 months, the industry went 
from experiencing strong growth and excellent market conditions 
to the worst economy many of us in the industry have ever seen. 
Despite how bad that market got, Nucor did not lay off a single 
worker.
    The economic conditions for the steel industry are 
improving. Capacity utilization has increased and we are seeing 
a return in demand. However, the strength and duration of the 
economic recovery remains to be seen. Greenhouse gas 
regulations are adding to this uncertainty.
    U.S. steel producers are in a highly competitive global 
market that will only get more competitive in the future. We 
face unfair practices from steelmakers in countries like China, 
and increasingly, we are not competing against other companies, 
but against governments, governments who bring their full 
weight to bear to ensure the success of their domestic industry 
through the use of subsidies, generous loans and other 
protectionist measures. I would say that is a pretty strong 
headwind to compete against. And the uncertainty created by our 
government's many regulatory proposals only adds to that 
headwind and diminishes the competitiveness of many U.S. 
industries.
    From an environmental perspective, America is the best 
place in the world to make steel. Our industry has reduced its 
energy-intensity by 30 percent since 1990, and reduced 
greenhouse gas emissions by 35 percent over the same time 
period while increasing overall production. This significantly 
exceeds the Kyoto Protocol targets. In fact, the U.S. steel 
industry has the lowest CO2 emissions per ton in the 
world. What is more, companies like Nucor have made steel the 
most recycled product in the world. As the Nation's largest 
recycler, Nucor kept more than 17 million tons of scrap metal 
from cars, appliances, and other discarded products out of 
landfills in 2010. The recycled scrap is then melted down 
through the use of electrical energy and made into new steel 
products.
    Because greenhouse gas emissions are a global issue, 
regulation through the Clean Air Act threatens both our 
competitiveness and the environmental benefit that results from 
making steel so cleanly in the United States. Ironically, these 
very regulations and practices that are intended to improve the 
environment actually result in increased global emissions and 
more environmental impact than if the industry had remained in 
the United States.
    The problems these regulations create manifest themselves 
in the permitting process and other ways. Everyone expresses 
concern about permitting and the impact these rules have on our 
ability to build industrial projects that create jobs and 
improve people's livelihoods. However, this is not a new 
problem. Over time, we have created a system that is comprised 
of endless reviews, hearings, allegations, lawsuits and 
continued modeling that has turned our permitting process into 
a slow, frustrating experience that has eliminated the 
certainty necessary for the expenditure of capital. I have been 
quoted as saying it is like being in a hamster wheel. The lack 
of availability of affordable energy also remains a real 
obstacle.
    Due to the continual halting of permits for new, 
traditional sources of energy generation and constantly 
promoting the development of expensive so-called green energy, 
we as a Nation are essentially pricing ourselves out of the 
industrial market. Mechanisms such as greenhouse gas rules, 
regional cap-and-trade programs, renewable energy standards and 
other permit battles are creating an environment where 
affordable energy, the lifeblood of industry, is becoming a 
rare commodity. For example, I modeled a facility that would 
recycle a million tons of steel and I looked at it in areas 
that had a renewable energy standard versus areas that had no 
renewable energy standard, and the difference in electrical 
cost was $52 million a year. As I presented that to the people 
in that particular State, I asked where we would build that 
facility, and they said not in our State. That is why you see 
industry moving to areas that have affordable and abundant 
energy.
    It looks like I am about out of time. We have something 
said about a permit that was recently issued to Nucor. I will 
tell you that we did receive a permit for a significantly 
diminished project versus the $2.1 billion we were going to 
invest. That permit, however, for that project, which will be 
phase 2, is still not fully issued. It is stayed pending some 
further actions. Thank you for your time.
    [The prepared statement of Mr. Rowlan follows:]

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    Mr. Whitfield. Thank you, Mr. Rowlan.
    At this time I recognize Mr. Pearce for 5 minutes, and Mr. 
Pearce is Director of Manufacturing for FMC.

                   STATEMENT OF JAMES PEARCE

    Mr. Pearce. Mr. Chairman, Ranking Member Rush and members 
of the committee. My name is Jim Pearce, and I am the 
Manufacturing Director for FMC's Alkali Division, and I thank 
you for holding the hearing on this important topic.
    FMC is a diversified chemical company manufacturing 
products for the food and pharmaceutical industries, for 
lithium batteries and energy storage. Our FMC products are used 
in a wide range of industrial usage and new applications to 
improve the environment.
    In Green River, Wyoming, where I live and work, we are the 
world's largest producer of sodium carbonate, better known as 
soda ash. The largest use of soda ash is in glass 
manufacturing, including food, juice, beer and wine containers, 
fiberglass, and flat glass for autos, houses, and buildings. It 
is also used in a number of household products such as a water 
softener, and it is the primary ingredient in powdered home 
laundry detergents. In Wyoming, we produce soda ash from 
naturally occurring trona ore that is mined from underground 
deposits. The four companies that comprise the so-called trona 
patch in Sweetwater, Wyoming employ over 2,100 people and 
account for roughly 90 percent of the domestic soda ash 
production in the United States and 25 of total global soda ash 
production. In addition, there are some 100 dockworkers in 
Portland, Oregon, and we estimate an additional 8,300 jobs 
nationwide that are dependent on our industry.
    Mr. Chairman, today American soda ash production is one of 
the good news stories in manufacturing. Our industry is a prime 
example of how government trade and lands policies can work to 
help sustain a U.S. manufacturing base. At FMC, we have 
improved our energy efficiency of our soda ash operations by 10 
percent over the past 10 years, and as an entire company we 
have met our commitment to the Chicago Climate Exchange Program 
reducing our greenhouse gas emissions by 10 percent from 2003 
to 2010. For FMC, energy efficiency simply represents smart 
business.
    The current U.S. approach to regulating greenhouse gases 
not only fails to incentivize us to achieve greater energy 
efficiency, but over time it may lead U.S. natural soda ash 
producers to lose business to our off-shore rivals, mainly the 
Chinese, who produce their soda ash synthetically. Synthetic 
soda ash generates an average of 30 percent greater greenhouse 
gas emissions per ton than does soda ash mined from natural 
resources.
    Mr. Chairman, our jobs growth in the natural soda ash 
industry is fueled by exports. The U.S. natural soda ash 
industry contributes over $875 million in surplus to the 
overall U.S. balance of trade, and our export sales have grown 
at 6\1/2\ percent per year over the last 28 years. This 
represents a significant contribution to the President's goal 
of increasing U.S. exports. It also contributes to job growth. 
FMC recently announced that we will be adding 100 new jobs in 
Green River as a result of export growth, directly exports. 
Domestic soda ash producers export 52 percent of what we 
produce, 52 percent. That means that one of our every two jobs 
is directly attributable to export sales.
    Keeping our lead is not something that we take for granted, 
nor has Congress. For example, the Congress saw fit to reduce 
the royalties that we pay on soda ash, realizing that the 
export increase would result in higher Treasury revenues, yet 
the pressure to remain competitive continue to grow. As an 
example, in 1990 China imported about 1 million tons per year 
of soda ash. Today, they are the world's largest producer of 
soda ash and export about 2.5 million tons per year.
    We have serious concerns about our future and our 
competitive position if not required to make non-economic 
decisions based on domestic regulations that our international 
competitors do not have to comply with. We do not understand 
why U.S. manufacturers should be required to make costly 
changes when less-efficient and higher greenhouse gas-emitting 
foreign competition does not.
    A Southeast Asian glass manufacturer will not buy from a 
U.S. soda ash producer whose prices are high simply because of 
U.S. regulations. Rather, they will buy from the lower-cost 
foreign competition that produces more greenhouse gas 
emissions.
    We ask Congress to take the long view on this matter and 
understand that acting in isolation may place the domestic soda 
ash industry at a significant competitive disadvantage while 
increasing the overall greenhouse gas global emissions. We 
would hope that Congress would fully debate the energy policies 
and drive energy efficiency in a way that not only maintains 
jobs but grows them along with exports.
    Thank you very much for this opportunity.
    [The prepared statement of Mr. Pearce follows:]

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    Mr. Whitfield. Thank you, Mr. Pearce.
    Mr. Cousins, you are recognized for 5 minutes, of Lion Oil 
Company.

                   STATEMENT OF STEVE COUSINS

    Mr. Cousins. Chairman Whitfield, Ranking Member Rush, 
members of the subcommittee. My name is Steve Cousins. I serve 
as Vice President of Lion Oil Company. I am a chemical engineer 
and I have spent my 33-year career at Lion Oil.
    My company's survival and our employees' jobs are 
threatened by the Environmental Protection Agency's moves to 
regulate greenhouse gas under the Clean Air Act. We believe 
these actions by the EPA are contrary to the plain wording of 
the Clean Air Act, are unwise and endanger America's economic 
and national security. This is why it is so important that you 
approve the Energy Tax Prevention Act of 2011 to stop EPA from 
moving forward with its regulations.
    Lion Oil is in El Dorado, Arkansas. We have been in 
business for 88 years. We produce 80,000 barrels a day of 
gasoline, diesel and asphalt. We sell to customers in seven 
States, and we have 600 people at our unionized El Dorado 
plant. We employ indirectly approximately 1,800 other people 
that support our company. We are in rural Delta County, where 
unemployment runs about 10 percent.
    I can give you one personal example of how EPA's current 
regulatory path has already inflicted real pain on the people 
in our small town. Lion Oil undertook a major expansion, 
several hundred million dollars, starting in 2007. The 
projected created 2,000 construction jobs in a town with only 
20,000 people in it. It was a real shot in the arm for our 
economy. Unfortunately, economic risk prevented us from 
reaching our goal. It left us with a much smaller project that 
provided much fewer jobs. The uncertainty and the potentially 
prohibitive costs associated with both at that time cap-and-
trade legislation and also EPA's looming greenhouse gas 
legislation were critical factors leading us to delay 
completion of this expansion.
    Ironically at the very same time construction jobs were 
being terminated in El Dorado, Arkansas, in India, more than 
75,000 workers were embarking on a 3-year project to build a 
brand-new state-of-the-art refineries 15 times larger than our 
plant. It is designed purely for export purposes. Every drop of 
gasoline and diesel they produce is going to end up in the 
United States or the European Union. And while our Arkansas 
union workers average over $23 an hour in wages, in India those 
same workers make about $5 an hour.
    It is going to take a crystal ball to determine exactly how 
the EPA enforces efficiency standards on refineries. We think 
that that is a likely thing we heard the Administrator testify 
to, and it sounds like a great idea but it sets up a scenario 
that we see where a small plant like ours is compared to plants 
five to ten times our size. Economies of scale always favor 
larger plants, the same way a 747 airliner uses a lot less fuel 
per passenger mile than a Piper Cub because it is larger and 
can be designed at far higher efficiency standards. Our plant, 
if we are held to the largest plants in the world to the same 
efficiency standards, then there is no cost that will allow us 
to achieve this. It would be out of reach and it will put us 
out of business. EPA has traditionally not shown the kind of 
flexibility that you would have to have to allow for those 
differences.
    In spite of our alarm at EPA's current path, Lion Oil is 
not in favor of turning back to the clock on environmental 
progress. We are very proud of what we have done. Since 1996, 
we reduced emissions from our facility by 73 percent while 
actually increasing plant throughput but it has come at a very 
high cost. Expenditures at our small facility has topped $200 
million in that time period in new environmental equipment with 
more than $19 million in increased operating costs. These costs 
are for the most part things that foreign refineries do not 
have to bear, and while many of these improvements offer real 
tangible environmental benefits, that is not true for EPA's 
plan to regulate greenhouse gases. Reducing U.S. greenhouse 
gases unilaterally, which is all EPA has the ability to do, 
will not reduce global concentrations of greenhouse gases at 
all, not significantly, and will most likely result in the 
export of U.S. jobs to countries not interested in greenhouse 
gas limits. This is exactly why the EPA does not need to be in 
the greenhouse gas regulation business.
    Under the Energy Tax Prevention Act of 2011, our elected 
representatives in Congress will have the ability to create a 
balanced and workable energy policy that does not disadvantage 
American workers. Thank you.
    [The prepared statement of Mr. Cousins follows:]

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    Mr. Whitfield. Thank you, Mr. Cousins.
    At this time I recognize Mr. Carter for 5 minutes.

                   STATEMENT OF LONNIE CARTER

    Mr. Carter. Chairman Whitfield, Ranking Member Rush and 
members of the subcommittee, my name is Lonnie Carter and I am 
the President and Chief Executive Officer of Santee Cooper, the 
South Carolina Public Service Authority. While I am currently 
serving as the Chairman of the Board of Directors of the 
American Public Power Association, my comments and presence 
here today solely represent those of Santee Cooper.
    Santee Cooper has been a resource for improving the health, 
welfare, and material success of the residents of South 
Carolina. Santee Cooper is guided----
    Mr. Upton. Excuse me. Is that----
    Mr. Whitfield. Is your microphone on?
    Mr. Carter. It has got a little green light that says it is 
on. Is that better?
    Mr. Whitfield. That is better. Thanks.
    Mr. Carter. It may be that slow southern accent that is 
slowing you down.
    We are still handling our mission for improving the quality 
of life for the people of South Carolina by providing low-cost, 
reliable power and water to our customers while being good 
environmental stewards. As South Carolina's State-owned 
electric and water utility, we have served 2 million customers 
either directly or indirectly. We are accountable for keeping 
electricity affordable and the lights on.
    Our industry is at a time of unprecedented change and 
challenge, the likes of which I have not seen in my 28 years in 
this industry, bringing with it uncertainty and high cost to 
customers. I am very concerned about the many proposed EPA 
regulations and what they may mean in the short and long term. 
As a public power entity, we have no shareholders to share the 
cost of regulations. We are literally where the rubber meets 
the road. We are the State's leader in renewable energy with 
197 megawatts of renewable generation already online or under 
contract. They are voluntary business decisions that 
successfully balance low cost, reliability and care for the 
environment.
    Santee Cooper has been a leader in installing environmental 
control technology and in fact already reduces nitrogen oxide 
by over 90 percent and sulfur dioxide by as much as 90 percent 
through SCRs and scrubbing at our generating stations. We 
launched a $113 million comprehensive energy efficiency 
campaign for our customers in 2009. We are also a leader in 
this Nation's reentry into the nuclear energy arena on tap to 
build two new nuclear facility in 2016 and 2019 with our 
partner, SCANA.
    If I were not here today, I would be at an economic 
development announcement. One of our largest industrial 
customers, Showa Denko Carbon, Inc., is announcing a multiple-
hundred million dollar investment to expand their facility. 
This project will create approximately 100 new jobs. Here is my 
point. By far the biggest concern going forward with this 
project is the uncertainty created by EPA's greenhouse gas and 
non-greenhouse gas regulations. This example highlights the 
issues with greenhouse gas regulations. The proposed 
regulations will result in higher costs and greater uncertainty 
for my customers.
    EPA also announced its desire to address greenhouse gases 
for the power sector through new source performance standards 
that will set emission guidelines for existing facilities. 
There is currently no off-the-shelf technology available to 
address greenhouse gas emissions at a commercial scale, making 
it different in like and kind from other emissions regulated 
under the Clean Air Act. New construction projects will likely 
be significantly delayed because there is no clarity in how to 
address greenhouse gases and PDS permits. EPA's failure to 
provide the necessary tools, information and direction will 
lead to permits being delayed and complex legal challenges to 
permits.
    The Clean Air Act simply is not designed to address 
greenhouse gas emissions. The policy to limit greenhouse gas 
emissions should be set by Congress. Setting a path forward 
regulating greenhouse gas emissions under the Clean Air Act 
would stifle an already slow permitting process, raise costs, 
limit economic development and industrial growth around our 
country at a time when we need jobs the most.
    EPA also plans to adopt numerous new rules over the next 
few years including coal ash, maximum available control 
technology standards, cooling water intake rules, air quality 
standards for ozone, lead and particulate matter. Individually, 
they represent sizable cost impacts. Together, they could be 
enough to significantly curtail the economic development and 
force many premature closings of low-cost, reliable power 
facilities that keep our Nation running.
    I support Chairman Upton's proposal that would remove 
regulation of greenhouse gases from Clean Air Act. The secret 
to success is a balanced and thoughtful approach that factors 
in the cost impacts of these proposed regulations to customers.
    Thank you for this opportunity and for your attention, and 
I am happy to answer any questions you may have.
    [The prepared statement of Mr. Carter follows:]

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    Mr. Whitfield. Thank you very much.
    Ms. Blaisdell, you are recognized for 5 minutes.

                 STATEMENT OF BETSEY BLAISDELL

    Ms. Blaisdell. Thank you. Good afternoon, Chairman 
Whitfield, Ranking Member Rush and distinguished members of the 
subcommittee. I appreciate the opportunity to testify at 
today's hearing. I am here on behalf of the Timberland Company, 
which produces boots, clothing and gear for the outdoors.
    I am also here on behalf of BICEP, which stands for 
Businesses for Innovative Climate and Energy Policy. We are a 
group of major consumer household brand companies such as Nike, 
Starbucks, Levi Strauss and Co., Best Buy, Target, Symantec, 
Gap, Aspen Ski Company. Timberland and the other BICEP 
companies believe that we need strong energy and climate 
policies to protect our supply chain, ensure market certainty 
as well as to help create jobs, level the playing field among 
businesses, enhance economic development and ensure global 
competitiveness as we move into the future.
    While we prefer congressional action to executive branch 
regulation, the latter is necessary when Congress leadership is 
lacking. Current EPA regulations as well as those under 
development would help protect our economy as well as human 
health and the environment.
    Mr. Chairman, we couldn't agree more with a couple of 
statements you made in your press releasing highlighting your 
premises for introducing the legislation that is the topic of 
today's hearing. That is, number one, Congress, not EPA 
bureaucrats, should be in charge of setting America's climate 
change policy, and secondly, a 2-year delay of EPA's cap-and-
trade agenda provides no meaningful certainty for job creators, 
fails to protect jobs and puts decision-making in Congress on a 
critically important economic issue past voters and the 
election year.
    Indeed, Congress should be setting America's climate 
policy, and the 2-year delay would create more uncertainty and 
lead to other problems, as you correctly point out. I will come 
back to these points in a moment.
    You are probably wondering why Timberland and the other 
BICEP companies care about climate and energy policies. We care 
because our supply chains are affected by current and projected 
climate impacts while materials for Timberland products as well 
as Levi and Gap jeans, Nike Sneakers, Starbucks coffee 
plantations, they all depend on water. If there is less water 
due to the projected climate change impacts, we all struggle to 
produce our products and meet the demands of our consumers and 
we will continue to suffer as weather events grow in severity 
and frequency, which interrupt our ability to move products to 
consumers. This costs us both time and money. Moreover, and 
this is very important, our employees and consumers are 
demanding that we take actions to reduce greenhouse gas 
emissions.
    For a global company, addressing climate change is no small 
task. We need policies hat will create long-term market 
certainty that parallels our planning timelines. I realize some 
entities want no action at all. However, many more companies 
recognize that we need to act to address this critically 
important economic issue we are facing right now, and acting 
sooner rather than later is more prudent and cheaper in the 
long run and will help avoid the worst potential projected 
impacts and hopefully help avoid more costly scenarios down the 
road that might occur if we do nothing in the near term. 
Failure to act would be more costly to our businesses and 
consumers down the road. Thus, for Timberland and other BICEP 
companies, acting to address climate change is a business 
imperative.
    Timberland is taking steps to be a leader in 
sustainability. In 2006, we actually voluntarily capped our own 
greenhouse gas emissions. Since then we have reduced our 
emissions for our facilities and operations by more than 40 
percent, which has saved us over $1 million a year, which is a 
significant savings for a company like ours during this tough 
economy. Investing in renewable energy in States like 
California has proven to be an effective hedge for rapidly 
rising utility costs. Energy efficiency in our corporate 
facilities and stores has cut energy consumption by more than 
30 percent with a payback of under 2 years, usually under one. 
Nutrition labels on our product communicate our progress to 
consumers. These labels combined with Earthkeepers footwear, 
which is designed to have a smaller climate impact, have helped 
drive remarkable growth while many of our competitors have 
struggled to survive.
    In your home State of Kentucky, Mr. Chairman, after several 
years of conversation with the local utility, we finally 
negotiated a deal to source electricity from a certified small-
scale hydropower facility on the Kentucky River. We pay a 
premium for that power, but the benefits far outweigh the 
costs. Our climate impact is dramatically reduced and the local 
community benefits from having an emissions-free renewable 
source of power that is a scenic learning lab for children in 
and around Danville.
    While Congress could be creating America's climate policy 
and while most businesses prefer this route, because Congress 
has failed to do so, we must fall back on EPA's authority and 
regulations. Preventing EPA from exercising its authority or 
rolling back any of its actions would cost the economy in human 
health in terms of illness and often results in lost work days 
and more. More specifically, in 2005 alone the Clean Air Act 
protections helped avoid 13 million lost work days, thereby 
helping maintain our Nation's economic productivity.
    On the second point in your press release, again, we agree, 
a 2-year delay on EPA's regulation of greenhouse gas emissions 
would enhance uncertainty in the marketplace and hinder job 
creation as well as delay critical decisions that Congress 
should in fact be making. So rather than going after EPA's 
ability to regulate including repealing a number of its current 
actions, Congress should act responsibly and develop sound 
energy and climate policy. Some of America's largest businesses 
stand ready to work with you, to work with Congress to develop 
responsible policies in this area. In lieu of such action, 
however, EPA must be allowed to do its job, and let me 
reiterate, we would like to be here. Many U.S. businesses 
including the BICEP companies in fact do prefer EPA regulation 
to no protections at all, as I previously mentioned.
    I look forward to constructive policy debates moving 
forward that focus on the best ways in which businesses can 
work with you to develop sound energy policies, policies with 
which many business would resoundingly agree. Let us work on a 
bipartisan basis to produce sound energy policies we can all be 
proud of and which virtually everyone on and off Capitol Hill 
recognize will help move us toward a better path for job 
creation, economic growth and global competitiveness.
    Thank you, Mr. Chairman.
    [The prepared statement of Ms. Blaisdell follows:]

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    Mr. Whitfield. We have two votes on the House floor. We 
have about 3 minutes left to vote, so we are going to go over 
there. We are going to take a break and hopefully be back by 
2:00 and then we will get to the questions and then we will go 
right to the third panel. So why don't you all go have a glass 
or lemonade or something.
    [Recess.]
    Mr. Whitfield. I would like to call the hearing back to 
order, please, and I am very sorry you all had to wait a little 
bit longer while we finished these votes, but I want to thank 
you for your testimony, and I will start off with questioning 
here and then we will go on down the line.
    First of all, Mr. Rowlan, I just want to follow up one 
thing. You mentioned something about $52 million a year in 
additional costs in renewable mandate States versus non-
renewable mandate States. Would you clarify that for me one 
more time?
    Mr. Rowlan. I was speaking to a business group, and I was 
showing the impact of a renewable energy standard on their 
utility rates, which is something that concerns us 
significantly.
    Mr. Whitfield. Right.
    Mr. Rowlan. Economical power is the lifeblood of industry, 
and I looked at several northeast States and some other States 
scattered throughout the country that had an RES standard, and 
then I compared that with, I think it was South Carolina and 
Arkansas without an RES standard, took the average commercial 
rate that we would have been charged, and the difference from 
the high end to the low end was $52 million annually.
    Mr. Whitfield. Wow.
    Mr. Rowlan. And that is just for the average amount of 
power for what we would be considered a medium-sized facility 
for us.
    Mr. Whitfield. Well, I know in Kentucky we do not have a 
renewable mandate, and our electricity rates are around 7 cents 
per kilowatt hour, which is pretty good. But you point out a 
good issue because the key for the United States and our 
growing economy is to maintain a global competitiveness, be 
competitive in the global marketplace, and if we unilaterally 
start adopting some of these rules like Ms. Jackson has on 
greenhouse gases, which even she admitted is not going to have 
any dramatic impact on greenhouse gases, and other countries 
are not taking any action, so it is really putting us at a 
disadvantage.
    Ms. Blaisdell, I know that you support her actions, and you 
came up and we talked a little bit about Danville, Kentucky. Do 
you all have a plant in Danville, Kentucky?
    Ms. Blaisdell. We have a distribution center.
    Mr. Whitfield. Oh, a distribution center. How many plants 
do you all have in the United States?
    Ms. Blaisdell. Are you talking about how many facilities or 
how many----
    Mr. Whitfield. Where you actually make the product.
    Ms. Blaisdell. We do not own a manufacturing plant in the 
United States. Most of the products that we manufacture come 
from factories we outsource from.
    Mr. Whitfield. From which countries?
    Ms. Blaisdell. All over the world. We do source from the 
United States as well.
    Mr. Whitfield. Oh, okay.
    Ms. Blaisdell. We just don't own any in the United States.
    Mr. Whitfield. Oh, okay. Well, time is running out here, 
but I just want to summarize in my view what Ms. Jackson said. 
She placed a lot of emphasis on the importance of certainty, 
and she also placed a lot of emphasis on being reasonable, and 
I really find myself puzzled by that because she also said 
really there is no technology available to control greenhouse 
gases, and then she said so the only thing we can do is that we 
can deal with efficiency, and then our friend Mr. Doyle from 
Pennsylvania said well, that seems perfectly reasonable, but in 
my view, companies are going to try to be as efficient as they 
can be in order to compete in the marketplace, and basically 
what we are doing here is, we are having government bureaucrats 
go in and say this is what you need to do to be efficient. And 
even if the State implementation plan or State enforcers say 
you do this, this and this to be efficient, there is not 
anything to preclude EPA from coming back and overruling them 
or changing it or whatever. And then you get to under the 
preventing significant deterioration the best available control 
technology, and it is my understanding that the State 
implementers or State regulators could conceivably even require 
you to switch your fuel; instead of coal or oil or natural gas, 
whatever, we want you to use wind power, that there was not 
anything in there that would prohibit that.
    And I just find it almost impossible to believe that she 
would refer to that as being certain, there is certainty here, 
and so the business people like that. I mean, the real issue 
is, we have a high unemployment rate. We are trying to compete 
in the global marketplace. We do want certainty, and in my 
view, there is not any way--at least she did say this. She said 
we have to have coal, for example, and natural gas and nuclear 
and all of that because as I said in my opening statements, our 
energy demands are going to double by the year 2035. And so I 
am assuming you all would agree with what I am saying. Ms. 
Blaisdell may not agree. Yes, sir.
    Mr. Rowlan. I will give you a real interesting example. We 
heat our steel up to roll it into a shape, and that is called a 
reheat furnace, and the Clean Air Act BACT for the burners in 
that is what is called reduce NOx or low 
NOx burner, which requires us to actually be less 
efficient. We actually limit the heat on it so that we create 
less NOx. So we are using more energy in order to 
keep NOx down. As we get into a greenhouse gas rule, 
are faced with the exact opposite of that. We are tied up in, 
do you raise NOx so that you lower CO2 or 
do you raise CO2 so that you keep NOx 
down. And that is the paradox that we are in.
    We also are caught up with that in CO, our CO emissions. 
Typically we put some oxygen with them as they come out of our 
furnace and convert them to CO2 so now if we limit 
our CO2 by not putting the oxygen in and burning it 
off afterwards, we are going to raise our CO, which is a 
criteria pollutant. So there is a lot of really difficult 
questions that would have to be asked if this were to go 
forward under the Clean Air Act, and frankly, I don't think 
some of the people are prepared to give us answers on it or 
make the decision.
    Mr. Whitfield. Right. Well, I agree with you.
    Mr. Rush, I will recognize you for 5 minutes.
    Mr. Rush. Thank you, Mr. Chairman.
    Attorney General Abbott, first of all, I want to 
congratulate you on some of the standards and your activities 
and your accomplishments as it relates to alternative energy. I 
understand from your testimony that your State is number one in 
the use of wind energy, and I certainly want to congratulate 
you and your State for those efforts. I know that you have a 
cheerleader here in Mr. Barton and so I am not going to 
congratulate you too much because I don't want to take some of 
his thunder away from.
    Suffice it to say that in spite of scholarly debates over 
the proper standards of judicial review of agency action or 
inaction under section 706 of the APA, in light of the Chevron 
Doctrine, the federal courts including the Supreme Court have 
been deferential to an agency's statutory interpretation where 
those interpretations are reasonable. This Chevron level of 
deference exceeds even the level of deference an appellate 
court must accord to trial courts under the de novo standard. 
De novo can be triggered when trial courts interpret laws like 
the Clean Air Act. Can you explain how the Supreme Court, that 
the outcome is wrong in the Massachusetts v. EPA decision? Were 
they deferring to the EPA's interpretation? Can you explain why 
and how the Supreme Court got it wrong?
    Mr. Abbott. Will I explain how the Supreme Court got it 
wrong?
    Mr. Rush. Yes, your interpretation, from your point of 
view, how is the Supreme Court's decision wrong?
    Mr. Abbott. Well, I think the Supreme Court decision is 
wrong because I don't think that it requires the EPA to 
regulate greenhouse gases but the fact of the matter is, I 
think under the Supreme Court's decision, it still did not 
mandate that the EPA must conclude that greenhouse gases pose 
an endangerment and it still provided certain other latitude 
for operating room for the EPA to operate as has been discussed 
in testimony throughout the course of the day.
    Mr. Rush. So are you saying that they were wrong because 
they did not mandate it? Is that what is wrong with the Supreme 
Court decision?
    Mr. Abbott. Well, yes.
    Mr. Rush. The reason why I ask that question is because you 
say on page 7 of your testimony that in Massachusetts v. EPA, 
the Supreme Court said it need not and does not reach the 
question whether carbon dioxide is the kind of air pollutant 
the EPA must regulate under the Clean Air Act, but my copy of 
the Supreme Court's decision says something a little different. 
I will bring your attention to section 7, paragraph 2 on page 
32. It says, ``In short, the EPA has offered no reasoned 
explanation for its refusal to decide whether greenhouse gases 
cause or contribute to climate change. Its action was therefore 
arbitrary, capricious or otherwise not in accordance with 
law.'' This is the matter that I am referring to. ``We need not 
and do not reach the question of whether on remand EPA must 
make an endangerment finding or whether policy concerns can 
inform EPA's action in the event that it makes such a 
finding.'' So you said that they did not and they are saying 
something altogether different.
    Mr. Abbott. Actually what I am hanging my hat on is that 
very sentence that you read, and I may have articulated 
inappropriately but what I meant to articulate is exactly word 
for word what that sentence says.
    Mr. Rush. OK. All right.
    Mr. Abbott. And that is that they basically don't reach the 
question whether or not the----
    Mr. Rush. But you conclude that----
    Mr. Abbott [continuing]. EPA must----
    Mr. Rush. But you are concluding that the Supreme Court was 
somehow wrong? I don't understand. I am trying to----
    Mr. Abbott. I disagree with the Supreme Court's ruling but 
it is the Supreme Court's ruling, and so we must operate under 
it.
    Mr. Rush. Thank you.
    Mr. Rowlan, on Friday EPA--no, that is quite all right, Mr. 
Chairman. I yield back.
    Mr. Whitfield. I recognize Mr. Upton of Michigan for 5 
minutes.
    Mr. Upton. Thank you again, Mr. Chairman. I regret I wasn't 
here for many of your presentations. We have another 
subcommittee that is meeting at the same time and so a number 
of us were there, and as you know, we had votes on the House 
floor as well.
    In the previous panel, I talked about the impact on 
Michigan with the job impact. In fact, there has been 
independent study that showed that Michigan's GDP would drop by 
$18 billion, destroy 96,000 jobs, reduce household incomes by 
nearly $1,600, and the concern that many of us have is if we 
allow EPA to pursue these regulations, we would have added 
cost. We heard from your testimony in terms of the impact on 
you all but I just wonder if you can summarize for me from your 
individual and somewhat unique perspective, I know it will be 
tougher for Illinois Farm Bureau because I don't know where 
those farmers--you are not going to go someplace else, you are 
going to keep the land there in Illinois, I would imagine. But 
as it relates to your industry, if these regulations are 
imposed, where do you think things are headed for your 
particular industry as it relates to the jobs that are 
provided? Are they going to go to India and China? Are they 
just going to close down? What is your individual opinion in 
terms of what will happen to the groups of similar industries 
as it relates to us having these regulations and not having 
them in other places around the world?
    Mr. Alford. Yes, sir. There is definitely going to be a 
transfer of wealth. I think there is a national security issue 
here where we Americans are number one in the world 
economically now but we could go to sixth, seventh, eighth, or 
ninth, and if we go to ninth, we are vulnerable to new enemies 
who look at us as someone who could be taken over, and I think 
we are at a fork in the road here. We better take the right 
way, and I think the EPA view or attitude towards the American 
worker is that of a pawn on a chessboard: expendable and no 
need to worry. I think that is a terrible attitude.
    Mr. Rowlan. I would say that it is already happening. I 
hear a lot of people ask for examples of companies going 
overseas. I explained it this way one time to some economic 
development people when EPA said that non-attainment would not 
impact them, and EPA said we have never heard of a company 
picking up and leaving an area because it was non-attainment, 
and I said that is because you don't even make the first cut. 
You are cut out and you are excluded, and that is what this 
lack of decisiveness and this constant 2 years, 1 year, when is 
this coming, when is this rule hitting, when is PM 2.5, when is 
ozone. That constant barrage causes you to take your capital 
and move someplace where you have got a level of certainty. 
This facility that I have worked on in Louisiana, in the time 
it has taken me to not completely get a permit, a full facility 
of that size has been constructed, permitted and is operating 
in China.
    Mr. Cousins. When I first started working in the refining 
industry, there were about 350 U.S. refineries. Today there are 
about 150. There hasn't been a single refinery built in this 
country in 30 years. There have been many built in the Pacific 
Rim, China, India. I mean, there is no guesswork. That is what 
is going to happen.
    Mr. Carter. I would turn your attention really to two 
areas. One is, as I have had the opportunity to meet with CEOs 
in a class actually for a weeklong class where the majority or 
the vast majority, out of 25, I think only six of us were U.S. 
citizens, which probably should be very telling in itself, and 
one of the things I learned from that group, much to my dismay, 
was just how they look down on us and when they look at making 
investments because of our permitting process and the fact that 
is lengthy and litigious and very poorly defined as it relates 
to almost every aspect of the way you permit a new plant, which 
makes us very uncompetitive, and what I have put in my 
testimony today is just another example of that, not just 
limited to what we deal with with EPA.
    A good solid example as it relates to what we are dealing 
with here is the issue over biomass. As I indicated in my 
testimony, we have contracted for a number of biomass 
facilities but they are having difficulty getting financing for 
those projects because they don't know what the permitting 
requirements are going to be for their facilities. Now, that is 
real. That means those jobs aren't going forward.
    Mr. Upton. And I know my time is expired so that just means 
why we need a real decision which this draft legislation does 
versus a simple extension where you sit on pins and needles. I 
yield back my time.
    Mr. Whitfield. Mr. Inslee for 5 minutes.
    Mr. Inslee. Thank you. Mr. Rowlan, thank you for being here 
with Nucor. We have a facility in Seattle. You run a very 
efficient business. You have found ways to make steel with 
great efficiencies. I will compliment you on that, and that is 
all this proposed regulation does for power companies was to 
ask them to be efficient like Nucor has been, the kind of 
decisions you have made to make cost-effective investments in 
efficiency. You have done that at Nucor. All this regulation 
does is ask utilities to do the same thing. That is why eight 
major utilities wrote a letter to the Wall Street Journal last 
month urging the adoption of these regulations so that they 
could have certainty so that they could move forward.
    I want to talk about this Dirty Air Act and bring it to 
real life. I want to show a brief video of an 11-year-old young 
lady named Megan Foster from North Carolina. She is a child 
with asthma who is a very, very fast runner but has difficulty 
when her asthma is triggered, which we know can be done by 
ozone. Can we just play this clip briefly, and then I want to 
ask you gentlemen a question.
    [Video shown.]
    Mr. Inslee. Thank you. Now, the Environmental Protection 
Agency pursuant to law and the U.S. Supreme Court and common 
sense has fulfilled their obligation to people like Megan to 
try to protect her and millions of other kids from pollutants 
that exacerbate asthma, and we are here today to consider a 
bill that would eliminate the ability of the Environmental 
Protection Agency to help children like Megan Foster, and I 
would like to know about your views and what science you can 
present to us about this issue. The EPA has determined that the 
science shows that pollutants, carbon dioxide and a variety of 
other climate-changing gases, have the capacity to injure human 
health including gases that exacerbate asthma including 
exacerbating ozone conditions.
    So I just want to quickly go down the road and ask you if 
you can present to this committee a single peer-reviewed 
scientific journal that shows that these gases that are subject 
to this regulation do not result in damage to human health 
associated with climate change, and if you give us a yes or no, 
if you say yes, I am going to ask you what it is. But let us 
just first go down yes or no. Mr. Abbott, do you have a single 
peer-reviewed study like that?
    Mr. Abbott. I haven't conducted that research.
    Mr. Inslee. Do you know of any, anywhere in the world?
    Mr. Abbott. I haven't looked into it.
    Mr. Inslee. Thank you. Mr. Alford?
    Mr. Alford. I haven't looked. Don't know.
    Mr. Inslee. Mr. Rowlan?
    Mr. Rowlan. I am not aware of it.
    Mr. Inslee. Mr. Pearce? Thank you.
    Mr. Pearce. I'm not aware.
    Mr. Inslee. Mr. Cousins?
    Mr. Cousins. No.
    Mr. Inslee. Mr. Carter?
    Mr. Carter. No.
    Mr. Inslee. Ms. Blaisdell?
    Ms. Blaisdell. No.
    Mr. Inslee. Now, I think this is pretty intriguing because 
this story gets written like ``he said, she said'' stuff by the 
press all the time. He said these gases are bad, these changes 
change the climate, she said they didn't, or in this case 
``he'' meaning Senator Inhofe. It is time to start writing the 
truth about the science on this issue.
    You gentlemen that represent the effort to repeal the Clean 
Air Act and pass the Dirty Air Act can't produce one single 
peer-reviewed scientific journal, and you are asking the United 
States Congress to eliminate the ability of the Environmental 
Protection Agency to protect kids like Megan Foster. Now, I 
think that is preposterous that you would come in and ask us to 
do this without presenting some science to us. Now, if you can 
find some, you can send it to me. I am interested in it. I have 
looked for it, so have the scientists that we have hired to do 
this including those at the U.S. Navy, and you know what? They 
can't find any because there is none, and I just hope that we 
eventually will do what the law requires, which is to follow 
science and protect the Megan Fosters of the world and do a 
very commonsense thing, which is to do just what Nucor Steel 
has done and that is about the efficiencies in the utility 
business, and if we do that, we are going to do some good 
things.
    Thank you. I would yield back.
    Mr. Whitfield. I recognize the gentleman from Texas for 5 
minutes.
    Mr. Barton. Thank you.
    I hate to take up too much of my 5 minutes but I have got 
to respond to what my good friend from Washington just said. 
CO2 is not an irritant for asthma. My good friend 
just asked if there was any peer-reviewed science that showed 
the negative. There is no peer-reviewed science that shows the 
positive, okay? Now, CO2 is a component of ozone, 
and ozone is a regulated criteria pollutant under the Clean Air 
Act, but if you are intolerant to ozone, you are going to be 
intolerant to ozone at one part per billion. If you are not 
ozone intolerant, you can be subjected to a thousand parts per 
billion and not be affected, and there is just as much 
scientific evidence that asthmatics are much more affected by 
rat feces and roach infestments in tenements as there is of the 
actual air quality. So it may be politically correct to show a 
figure of a young, innocent asthmatic child. My son when he was 
growing up was asthmatic, so I know a little bit about this 
from a personal perspective.
    But to use that and then somehow say that what we are 
trying to do here in protecting the American economy and 
keeping jobs in America is somehow going to hurt the public 
health is just flat not true. We are not changing one standard 
in the Clean Air Act. We are not changing the definitions of 
the criteria pollutants. We are simply rectifying a 5-4 
decision of the U.S. Supreme Court that gave the EPA the right 
to look at CO2 if they wanted to. The Obama 
Administration wanted to. They put out their endangerment 
finding, which I think is fatally flawed, and the result is, we 
are trying to do the legislative intent which is clarify what 
the Clean Air Act actually meant. If Chairman Upton and 
Subcommittee Chairman Whitfield want to come back at a later 
date and regulate CO2, they will put that bill 
before the subcommittee and the full committee. But first let 
us make sure that we express the will of the people through the 
Constitutional authority that we have on CO2.
    Now, I want to go to Mr. Abbott, the great Attorney General 
from the State of Texas. You are the chief law enforcement 
officer of the state. Is that correct?
    Mr. Abbott. Yes, sir.
    Mr. Barton. And I know you are not a clean air expert but 
you are knowledgeable about it. There are six criteria 
pollutants under the Clean Air Act. Is the State of Texas 
noncompliant on lead anywhere in the State?
    Mr. Abbott. Not that I know of.
    Mr. Barton. Are they noncompliant in SO2 
anywhere in the State?
    Mr. Abbott. Not that I know of.
    Mr. Barton. Are they noncompliant on nitric oxide anywhere 
in the State?
    Mr. Abbott. Not that I know of.
    Mr. Barton. Are they noncompliant on carbon monoxide 
anywhere in the State?
    Mr. Abbott. Not that I know of.
    Mr. Barton. Are they noncompliant anywhere in the State of 
Texas on particulate matter?
    Mr. Abbott. Not that I know of.
    Mr. Barton. Now, ozone, they are in non-attainment ozone. 
Where are the three areas in Texas that are noncompliant for 
ozone?
    Mr. Abbott. I am not sure.
    Mr. Barton. Well, I do. I know. Houston is in 
noncompliance, Port Arthur is in noncompliance, and the Dallas-
Fort Worth area is in noncompliance under the new standard. 
Now, under the Clean Air Act of 1992 or 1990, the EPA put out 
regulations for air quality that Texas began to comply with, 
and since that time Texas has issued over 100 permits to 
private industry in Texas. They all got invalidated in December 
of this year. Is that not correct?
    Mr. Abbott. That is correct.
    Mr. Barton. Were they invalidated because they were in 
noncompliance for any of these criteria pollutants including 
ozone?
    Mr. Abbott. No.
    Mr. Barton. Why were they invalidated?
    Mr. Abbott. Well, they were invalidated because of the SIP 
call and FIP calls that were issued by the EPA.
    Mr. Barton. So they were invalidated because the EPA 
changed their mind or just didn't like the way Texas was doing 
things?
    Mr. Abbott. They were invalidated because the EPA basically 
took over the Texas air permit system.
    Mr. Barton. They took over, but they didn't take it over 
because we are in noncompliance?
    Mr. Abbott. Correct.
    Mr. Barton. OK. Has EPA alleged that we are in 
noncompliance?
    Mr. Abbott. Not that I am aware.
    Mr. Barton. I am not aware of that either. So there are two 
issues with regards to what is happening in Texas. One is 
compliance with the existing Clean Air Act, and we have just 
shown that with the exception of ozone in three areas, we are 
in compliance. The other is, these new greenhouse gas 
regulations. Why has the State refused, or maybe I should say 
what has the State of Texas done with respect to the EPA 
mandate on these new CO2 regulations?
    Mr. Abbott. Well, I can tell you from the legal 
perspective. I can't tell you from the TCEQ perspective.
    Mr. Barton. Well, tell me from the legal perspective.
    Mr. Abbott. From the legal perspective, there are basically 
six different rulings that were made by the EPA, and as a 
result there are six different legal actions filed by the State 
of Texas in response. One involves the endangerment finding. 
Another involves the tailoring rule. Another involves the 
timing rule. Another involves the tailpipe rule, and one 
involves the SIP call and the sixth would involve the FIP call.
    Mr. Barton. I will ask the rest of my questions in writing. 
Thank you, Mr. Chairman.
    Mr. Whitfield. Yes, sir.
    Mr. Green, 5 minutes.
    Mr. Green. Thank you, Mr. Chairman. I would like to welcome 
our panel and particularly our Attorney General. You will all 
have a little different questions from this side of the aisle 
but you at least have the same Texas accent that Joe and I 
have.
    I want to welcome you to the committee, and we heard, the 
topics we are discussing today at the hearing are complicated 
and these are a wide range of views. Some of our views are 
similar, and neither of us believes that the EPA regulation of 
greenhouse gases is the right solution to our energy and 
climate change challenges. We are both interested in improving 
the economy and creating jobs, specifically keeping those jobs 
in Texas. I would like to talk to you about an area where our 
views may diverge a little bit. On December 23rd, EPA issued an 
interim final order that allowed EPA to assume responsibility 
for the Texas air permit program with regard to greenhouse 
gases. EPA has stated it took the action because under your 
guidance, the State of Texas indicated it would not include 
greenhouse gas and emissions pollution in air permits. Is that 
correct? Was it only greenhouse gases?
    Mr. Abbott. Would you state the predicate again?
    Mr. Green. Texas took this action and indicated it would 
include greenhouse gas emissions pollution in the air permits.
    Mr. Abbott. Right.
    Mr. Green. And it is my understanding that Texas is the 
only State that refused to modify its air program. Is that 
true?
    Mr. Abbott. That is my understanding.
    Mr. Green. That the other 49 States, including some who are 
suing the EPA like Texas is over the endangerment finding, have 
taken some action to move forward to comply with the new 
requirements.
    Mr. Abbott. Well, I can't be clear about what the other 
States are doing. Here is my understanding, and that is the EPA 
sent out a letter requesting responses from all the States. 
Many States responded. Maybe some States said they would go 
along. I can't guarantee you that all States responded and all 
States said they would comply. Texas is the only State that 
made clear that we would not comply with the greenhouse gas 
regulations.
    Mr. Green. I think, at least our information is the other 
49 said yes, they would, and believe me, I explained to people, 
we are up here all the time about American exceptionalism 
issues worldwide. Come to Texas and we will explain to you 
Texas exceptionalism, and that is something we all have.
    Mr. Abbott. I could make clear, Texas is not the only State 
that is challenging the EPA's greenhouse gas regulations.
    Mr. Green. That is true. Yes, there are a number of States 
that are filing suit. Given your position, I understand the 
consequences would have been if EPA had not assumed 
responsibility for these air permits, if Texas wasn't willing 
to start it, even though the lawsuit is filed and that is the 
way you do it, you go to the courthouse, and for decades the 
Clean Air Act has required certain sources to obtain air 
permits before construction begins on a new facility. These 
permits, called PSD permits, were required to start building. 
My question is, would it be legal to build a facility without 
one of these permits when the law requires it? So if Texas was 
not enforcing it--I have the Houston ship channel. I have five 
refineries and more chemical plants than I can count. My 
concern was, Texas is not enforcing it. If we wanted to expand 
those plants, and thank goodness over the last 15 years most of 
the plants have been expanded, that we would not without having 
a permit processed whether it is through the State of Texas 
enforcing a regulation that they don't agree with and going to 
court or the EPA taking over those air permits. Is that 
generally what would happen?
    Mr. Abbott. Well, I think generally what you are saying may 
be true. This is outside my area of expertise. However, what I 
think is that had the EPA not issued the SIP and FIP calls, it 
is my understanding Texas would have been able to continue on 
with the permitting process.
    Mr. Green. Well, we will figure that out, but my concern 
was that if Texas would not do it--and I have plants that are 
always in the process of trying to expand. And you know how 
competitive the chemical industry is, for example, that, you 
know, if they are trouble with--if they are not going to build 
a facility in East Harris County if they are worried they won't 
have that permit available, you know, pr they won't be able to 
get permission to build it, they would build it someplace else 
and ship those chemicals back to us. That is where I don't mind 
going to the courthouse. That is what a lot of us did for a 
living. I just worry that I don't want to put my plants at a 
disadvantage because of the battle between the State and EPA.
    Mr. Abbott. Right.
    Mr. Green. That is my concern.
    Mr. Abbott. I want to make clear that we stand foursquare 
with you on that proposition. We want the businesses in your 
district as well as the businesses across the State of Texas 
not to be at any disadvantage whatsoever. We want to make sure 
they have access to the permits they need in order to operate 
their business. We want to make sure that we continue to 
attract jobs to the great Houston and Texas area but, as you 
know. Texas has done a better job of creating jobs than all of 
the other States in the country. One reason why we have been so 
successful in that regard is because Texas has a more 
reasonable regulatory system and has not had to deal with every 
evolving changing rule like what they are seeing coming out of 
the EPA now.
    Mr. Green. I am out of time and I know the Chair is going 
to gavel me, but I served 23 years in the legislature, and we 
always enforced our clean air permits even when I was there 
based on the EPA saying the State of Texas could enforce it. We 
always had to jump through hoops from the Federal Government, 
you know, 18 years ago and 20 years before that, and I know it 
is frustrating but EPA has had that authority over Texas I know 
for the last 38 years.
    Thank you, Mr. Chairman.
    Mr. Whitfield. Mr. Shimkus, 5 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman. The full committee is 
named the Energy and Commerce Committee, so our focus is energy 
issues and commerce issues. The Democrats who want to make this 
into a science argument ought to go to the Science Committee. 
That is why we have a Science Committee. If they want to debate 
science, go to the Science Committee. We want to talk about 
energy. We want to talk about commerce. That is why I hold up 
my coal miners. One thousand of them in one mine, 1,000 coal 
miners in one mine lost their jobs. This is replicated in 
Illinois, 14,000, State of Ohio, 35. These are real job losses. 
If you want to talk about public health, the worst thing you do 
for public health is not have a job and be poor and in poverty. 
The best thing for human health is to have a job and maybe a 
job that provides health care, although we are attacking that 
too in those provisions.
    So this hearing is focusing on jobs, and as I laid out in 
the previous panel that when you raise energy costs, you hurt 
the ability to create jobs and sustain jobs. I do believe in 
supply and demand. I do believe that if more capital is 
required to produce that electricity that cost gets passed on.
    Now, it is curious that Ms. Blaisdell is here, and I have 
your testimony, and you are not only here with respect to 
Timberland but also BICEP. Is that correct? And BICEP is the 
Business for Innovative Climate Energy Policy, so you all like 
this climate debate, right? I mean, you are supporting----
    Ms. Blaisdell. Sir, we don't like climate change. We are 
here to support aggressive legislation.
    Mr. Shimkus. OK. Right. So you would have supported Waxman-
Markey, putting a price on carbon and addressing climate.
    Ms. Blaisdell. We support addressing climate.
    Mr. Shimkus. Great. OK. Now, it is curious that you and 
these folks do that because in articles in May 2002, many 
companies that are in this Business for Innovative Climate and 
Energy Policy, guess where your products are produced? China. I 
will quote this article May 9, 2002: ``While companies such as 
Gap, Guess, and Ralph Lauren have long farmed out production 
overseas in China,'' also Levis they mention here. Now, your 
company is not immune from this. In an article by Business 
Daily Update, except for your answering to the question, March 
27, 2006, article is, ``Unbeknownst to many''--talking about 
Timberland--``actually operated 45 factories throughout the 
country since the 1990s.'' Forty-five factories throughout the 
country, that country being China. So wouldn't it be to your 
advantage to force higher utility rates on manufacturers in 
this country while taking advantage of low power rates in China 
along with low labor rates, along with low environmental 
standards? In fact, following up on an article August 7, 2009, 
on Timberland, who you represent, ``Two mainland suppliers of 
outdoor clothes manufacturer Timberland have consistently 
breached environmental regulations, two NGOs said yesterday.'' 
This is Chinese environmental regulations. You have to be 
pretty bad to violate Chinese environmental regulations.
    Now, I find it just incredible that you would come here 
supporting hard action on climate change, raising the cost of 
doing business while your production is in these very same 
countries that will never comply, do not pay the same wage 
rate, and do not have any environmental standards, and I am 
glad that the Minority asked you to come because it highlights 
the hypocrisy of this debate, that you can stand here and you 
can call for increased regulations and costs while your company 
outsources manufacturing and we don't have jobs, and with that, 
Mr. Chairman, I yield back my time.
    Mr. Whitfield. Thank you, Mr. Shimkus.
    Ms. Blaisdell. May I please reply?
    Mr. Whitfield. I want to ask unanimous consent that we 
enter into the record at this point, these are documents 
relating to Mr. Waxman's introducing into evidence the Stephen 
Johnson issue on the endangerment finding, and these are the 
complete set of documents from the government, and then I 
understand Mr. Inslee had a document he would like to enter 
into the record.
    Mr. Inslee. Yes. Thank you. I just would like to introduce 
two documents. One is actually the endangerment finding that 
reads, ``Climate change is expected to worsen regional ground-
level ozone pollution. Exposure to ground-level ozone has been 
linked to respiratory health problems ranging from decreased 
lung function and aggravated asthma to increased emergency 
department visits, hospital admissions and even premature 
death.'' That is one. The second is this letter I referred to 
in my questioning from 1,800 doctors, and the third is 
testimony by Dr. Mark Jacobson of Stanford, who presented 
testimony in April to the Select Committee that specifically 
addressed the health impacts of CO2 on respiratory 
illness. Thank you, Mr. Chair, for your courtesy.
    Mr. Whitfield. Without objection.
    [The information appears at the conclusion of the hearing.]
    Mr. Whitfield. At this time I recognize Mr. Walden for 5 
minutes.
    Mr. Walden. Mr. Chairman, I thank you for that, and I am 
going to yield my 5 minutes to the distinguished gentleman from 
Texas, Mr. Barton.
    Mr. Barton. I thank the gentleman from Oregon, and I will 
root for the Ducks at least one time next year because you are 
yielding to me.
    Mr. Walden. If it is in the BCS, I will especially 
appreciate that.
    Mr. Rush. Mr. Chairman, let me just ask a question.
    Mr. Whitfield. Excuse me just one minute.
    Mr. Rush. The previous member made some pretty significant 
and strong remarks to Ms. Blaisdell, and she did not have a 
chance to respond at all on the record, so I think that she 
should be allowed to respond to some of the sharp remarks.
    Mr. Whitfield. Do you want to respond, Ms. Blaisdell?
    Ms. Blaisdell. Yes, please.
    Mr. Whitfield. All right.
    Ms. Blaisdell. So my first response would be that 
addressing our own greenhouse gas emissions hasn't created 
additional costs for our company. In fact, as I mentioned in my 
testimony, it saved us over $1 million a year, which makes us 
more competitive, and we do employ close to 2,000 people in the 
United States, so all those jobs he talked about in China, he 
is denying the fact that we actually do employ quite a few 
people here and in fact in many of the States that you 
represent.
    One of the concerns I have about the conversation we have 
had so far is that we have talked about the cost of action and 
we haven't talked about the cost of inaction, which I why I 
believe I am here. Our industry is very different than the 
industries represented. There is a significant cost of inaction 
in the outdoor industry and for brands whose supply chain rely 
on raw materials that we can't necessarily source in this 
country, so I would like to bring that to light.
    Mr. Whitfield. Well, I would just say that we appreciate 
your comments but I think most of us certainly agree with Mr. 
Shimkus, that if you are doing work in China and you are 
violating environmental regulations in China, to be coming over 
here and saying we need stronger regulations is a little bit--
--
    Ms. Blaisdell. Sir, I don't understand what violations he 
is talking about so I will have to explore what he submitted.
    Mr. Whitfield. We will try to get that to you and maybe you 
can get back to us in writing about that.
    Ms. Blaisdell. I would be happy to.
    Mr. Whitfield. Mr. Walden.
    Mr. Walden. Thank you, Mr. Chairman. Again to Mr. Barton.
    Mr. Barton. Thank you.
    Attorney General Abbott, is Texas air quality improved or 
diminished during the period since Texas implemented its 
flexible permitting program under the Clean Air Act Amendments 
as implemented by regulation in 1992?
    Mr. Abbott. I don't have the information on Texas health 
quality.
    Mr. Barton. You don't have information that our air quality 
is actually improved?
    Mr. Abbott. I thought you said health quality.
    Mr. Barton. Air quality.
    Mr. Abbott. Absolutely air quality has improved.
    Mr. Barton. Significantly?
    Mr. Abbott. Significantly, yes.
    Mr. Barton. So we have not diminished our air quality under 
our permitting program?
    Mr. Abbott. I will tell you the information I do have, and 
that is the information that as I understand, it was provided 
by TCEQ, the Texas Commission on Environmental Quality, as well 
as information that we received from the governor's office. One 
point is that industrial ozone and NOx have steadily 
declined since 2000. Another is that ozone is down 22 percent 
while NOx is down 46 percent. Another is that 
electricity generators in Texas have the 11th lowest 
NOx emissions in the United States. But I think 
equally important, and that is without any kind of greenhouse 
gas mandates from D.C., Texas on its own has since 2004, no 
other State has cut more power sector CO2 output 
than the State of Texas. Also, as you know very well, we have 
installed wind power at a rate more than any other State in the 
United States and I think we would rank either fourth or fifth 
of all the countries in the entire world, and, as I understand 
it, Texas has one of the two largest absolute declines in 
greenhouse gas outputs of any State.
    Mr. Barton. I just want the record to show that Texas has 
issued all these permits since 1992. They have been in 
compliance with the Act. Our air quality has improved yet our 
economy has grown, and just arbitrarily here in the last 6 
months they have come in and invalidated the existing permits. 
We are not talking about new permits under the CO2 
regulations, we are talking about existing permits.
    Now, specifically, Attorney General, with regard to this 
pending legislation, do you support the draft Energy Tax 
Prevention Act of 2011?
    Mr. Abbott. There are reasons why we think this legislation 
is a good idea. First and foremost, in the big picture we are a 
Nation of laws, and that is one thing that has separated this 
country from all other countries in the world, in fact, made 
the United States the envy of all countries in this world, and 
that is that we as a Nation base our decisions on the law, not 
the whims of different people, and a challenge that the State 
of Texas is having with the EPA is that we feel that the EPA is 
acting in a way unconstrained by the Clean Air Act passed by 
the United States Congress, unconstrained by other laws such as 
the APA, and causing industry as well as States to have to deal 
with a moving target, and we think that the rule of law is 
essential in this country and we want to see the EPA comply 
with the rule of law. And along those lines Texas has six 
lawsuits on file right now challenging the legality of the 
greenhouse gas rules that were created by the EPA.
    Mr. Barton. If this bill were to become law, how would that 
impact the litigation that the State currently has against the 
EPA?
    Mr. Abbott. As the Attorney General of Texas, I am here to 
tell you that if your legislation passes, it will mean that 
Texas will be dismissing those six lawsuits against the EPA.
    Mr. Barton. And that is a good thing?
    Mr. Abbott. Anything that gets rid of lawsuits is a good 
thing.
    Mr. Barton. I agree with that.
    My last question is to the general panel. If we had to 
implement these greenhouse gas regulations which hopefully we 
won't but if we did, is there the technology currently on the 
shelf to cost-effectively implement the greenhouse gas 
regulations as proposed by the EPA?
    Mr. Alford. I daresay no.
    Mr. Rowlan. No.
    Mr. Cousins. For our industry, we looked at the 2008 ANPR 
that the EPA released as a guide for possible greenhouse gas 
regulations, and we have evaluated every one of those 
technologies at various times in the past to do efficiency 
improvements. Those things are all cost-prohibitive for us.
    Mr. Barton. My time has expired. I again want to thank my 
friend from Oregon for his courtesy.
    Mr. Whitfield. At this time I recognize Mr. Burgess for 5 
minutes.
    Dr. Burgess. Thank you, Mr. Chairman, and Attorney General 
Abbott, thank you for spending the day with us. I think there 
was some--I know it is difficult because the Administrator is 
not here any longer but it seems like there was some confusion 
when we were talking about the problem that Texas is having 
currently with the flexible permitting and her discussion of 
regulating greenhouse gases under the Clean Air Act. Those are 
two very serious issues but they are separate issues. Is that 
not correct?
    Mr. Abbott. That is correct.
    Dr. Burgess. And currently when I was discussing with her 
the report of the Business Roundtable, they pointed out that 
this would be one thing that would be extremely deleterious to 
Texas. Similar conditions exist in other States and no other 
State is being required to perform what Texas is being required 
to perform under their removal of the flexible permitting. Is 
that correct?
    Mr. Abbott. That is my understanding.
    Dr. Burgess. And then to the issue of regulation of 
greenhouse gases, she is correct that Texas right now is not 
proceeding with setting up those guidelines. Is that correct?
    Mr. Abbott. That is correct also.
    Dr. Burgess. And so as a consequence, the EPA feels it is 
necessary for that job to be done, and we can argue about the 
rightness or wrongness of that but that is indeed a separate 
issue when she says that since Texas wasn't doing its job, the 
EPA had to do the job for Texas but that in no way applies to 
the flexible permitting process that is going on down in the 
Gulf Coast area?
    Mr. Abbott. That is correct.
    Dr. Burgess. And these are difficult concepts to deal with. 
Mr. Barton talked about the air quality issues that have 
occurred since the enactment of the Clean Air Act, and while to 
be certain there are still significant challenges for us in the 
Dallas-Fort Worth metropolitan area, there are challenges in 
the Houston metropolitan area. When you look at the overall air 
quality, there has been improvement since 1992.
    If you look as what has happened to population growth, 
particularly in the Dallas-Fort Worth metropolitan area, with 
which I am most familiar, you have only got to look at what is 
happening with congressional redistricting and the fact that 
Texas is going to have four more seats in the next Congress to 
understand what is happening to our population in the Lone Star 
State. It is exploding. I have the 10th largest congressional 
district in the country, 280,000 residents over and above what 
I should have with the normal congressional allotment, so it is 
a phenomenal development that air quality has improved while 
our population has in fact expanded many times over what it was 
in 1992. Do you think that is a fair assessment?
    Mr. Abbott. Based on information I have, you are exactly 
right and that is that air quality in Texas has continued to 
improve despite the growing population.
    Dr. Burgess. Well, just in your experience in working with 
the EPA, is that an easy situation or a difficult situation? 
Has the EPA been open to your suggestions and your observations 
or is it a closed door and the cake is already baked, we don't 
need your input?
    Mr. Abbott. For more than a decade, I would say Texas has 
had a fairly collaborative, cooperative working relationship 
with the EPA. I can tell you that my office directly has been 
working side by side with the EPA to hold polluters accountable 
and has been quite successful in that regard. It seems as 
though over the past 18 months or so the challenges in dealing 
with the EPA have escalated dramatically and it has been a lot 
more difficult.
    Dr. Burgess. And that has just been my observation as well, 
and I was wondering if other people were noticing that as well.
    Mr. Rowlan, if I could, let me ask you a question, and 
again, I appreciate you being here. You are headquartered in my 
hometown in Denton, Texas, and we are all so grateful for your 
great efforts there. We are grateful for your great efforts 
with the University of North Texas and the research program 
that you have there. I think you have developed the largest 
frame testing machine west of the Mississippi. Is that an 
accurate statement? Well, we heard from Administrator Jackson 
that there are so many of these things that--and I am a 
believer in efficiency, and no one, I think, should be in favor 
of wasting energy but can you really capture the return on 
investment necessary to do the things that you are going to be 
required to do by simply latching on to those increases in 
efficiency? Are they going to pay for themselves over time?
    Mr. Rowlan. Well, we pursue those continually. We actually 
have energy intensity goals within our own company. We are 
pursuing improving our efficiency constantly, because if we 
don't, we are going to run into problems with our international 
competition. There are projects throughout the country, and I 
am aware of one steel mill that was shut down, however, for 
tenths of a cent per kilowatt-hour. When you consume as much 
energy as we do, the cost of energy becomes a huge impact for 
us and so as that starts to escalate, we are no longer able to 
compete because we are really close to the physical reality of 
what we can do with the equipment that we have got and the 
technology that presently exists and even the technology that 
is coming on now.
    Dr. Burgess. Thank you for your answer. I yield back my 
time. Thank you, Chairman.
    Mr. Whitfield. Mr. Waxman is recognized for 5 minutes.
    Mr. Waxman. Thank you, Mr. Chairman. We have heard quite a 
bit of criticism of EPA at today's hearing. We have heard that 
EPA is out of control and that simple commonsense measures like 
requiring newly built facilities to be energy efficient will be 
burdensome to the economy. But there are other voices who are 
not fairly represented here today. Many in industry believe 
that EPA is acting reasonably and taking modest first steps to 
combat a serious problem.
    On Friday, EPA held the first of a series of five listening 
sessions on New Source Performance Standards that it plans to 
propose later this year for power plants and refineries. I 
think it is worth pointing out that EPA is beginning the 
process of crafting these new standards by hearing from 
industry. At Friday's session, Eric Svenson of PSEG, a major 
utility company, said this about climate change: ``We obviously 
would prefer to have seen legislative action but absent 
legislative action, we support regulatory action,'' which by 
the way is my view.
    Mr. Rowlan, were you aware that this major utility supports 
EPA's regulation?
    Mr. Rowlan. Was I aware that they support regulation?
    Mr. Waxman. Yes.
    Mr. Rowlan. Yes, I would be aware of that.
    Mr. Waxman. Don Neal of Calpine, another utility, said 
this: ``Calpine has been a long supporter of EPA regulating 
greenhouse gases under the Clean Air Act and certainly the NSPS 
is an extension of doing that so we applaud EPA in doing 
this.''
    Mr. Carter, were you aware that at least one major utility 
is applauding EPA's program?
    Mr. Carter. Yes, sir.
    Mr. Waxman. OK. Well, the public wouldn't have known about 
these statements either, because these witnesses weren't 
invited to testify. In fact, we wanted these companies to come 
and testify but we were told by the Majority that they would 
not allow our request to hear from a coalition of businesses 
who develop energy-efficiency projects at major manufacturing 
facilities like, for example, steel plants. One member of this 
coalition recently helped a northern Indiana steel plant 
install technology to capture and harness the manufacturer's 
waste heat to generate 220 megawatts of power. That is more 
clean electricity than all of the solar panels connected to the 
U.S. electric grid, and that recycled energy saves the plant 
$100 million every year. Since we can't hear this testimony for 
ourselves, Mr. Chairman, I would ask that the written statement 
of the Alliance of Industrial Efficiency be placed in the 
record.
    Mr. Whitfield. Without objection.
    [The information appears at the conclusion of the hearing.]
    Mr. Waxman. Thank you.
    Ms. Blaisdell, in your testimony you say that EPA 
regulations would help protect the economy. By the way, I heard 
earlier in this hearing you were accused by one of my 
colleagues on the Republican side of the aisle, that you would 
be at a competitive advantage if these EPA regulations go 
through. Do you have any comment on that? Would you be at a 
competitive advantage if we regulate as EPA is proposing to do 
here in the United States?
    Ms. Blaisdell. I am not familiar with how we would be----
    Mr. Waxman. Press your mic.
    Ms. Blaisdell. It is on. I am sorry. I don't know how we 
would be at a competitive advantage.
    My other concern about his remarks is, he implied that 
energy costs drove our jobs overseas, and that is not the case 
in our industry, so I want that to be clear for the record as 
well.
    Mr. Waxman. Well, your company has been abiding by a self-
imposed limit on its carbon pollution, and I would like you to 
tell the committee about your company's experience. Have your 
investments in efficiency produced cost savings, and if so, do 
you think other companies are likely to experience similar 
savings?
    Ms. Blaisdell. Our initiatives which have involved 
investing in renewable energy and in energy efficiency have 
saved our company money, over a million dollars a year, which 
is significant. We are a $1.4 billion company, so especially 
during a tough economy, that has been significant for us. And I 
do believe that other companies can benefit by taking a more 
critical look. I am sad to say that without leadership from 
Congress that many companies just aren't looking hard enough, 
and this could help.
    Mr. Waxman. And when somebody comes forward to suggest that 
maybe we can look harder to save money by doing what is right 
in efficiency which would make the company even more 
competitive, you are bullied by saying that you are part of 
some international conspiracy because you also have activities 
offshore. I don't think that is right.
    EPA has acted reasonably so far. We have heard from 
Administrator Jackson that the Agency plans to continue working 
with business to develop commonsense standards. Let us allow 
the Clean Air Act to do what it has always done: improve the 
air we breathe and make our families healthier while the 
economy grows. Thank you, Mr. Chairman.
    Mr. Whitfield. Yes, sir.
    Mr. Sullivan, you are recognized for 5 minutes.
    Mr. Sullivan. Well, I thought it was interesting, Ms. 
Blaisdell, that you said that your company did these things 
voluntarily, and I think that is great, and you have 
efficiencies and everything. That is what these business people 
do voluntarily. They do a lot of things like that too. You 
weren't mandated to do things, and I think that is the big 
difference, and that is what we are talking about here today.
    I appreciate all of you coming. I am sure you like the 
people in my district in Oklahoma are scared to death about 
what could happen to your businesses and the people that you 
work for, that you know their families and you know them very 
well, and it is frightening.
    I would like to ask you, Mr. Cousins, a question. You 
mentioned that while you were having trouble expanding your 
refinery, in India a refinery was built 15 times larger than 
your refinery and it took about 3 years. Could we build such a 
refinery in the United States today, in today's regulatory 
climate? And how long would the permitting for such a facility 
take? You mentioned the Indian refinery took 3 years to build. 
Would it take you longer?
    Mr. Cousins. Oh, I am not an expert on obtaining permits 
but I don't believe it would be possible to permit that 
refinery in the United States if you had all the time in the 
world, and I would--they have been trying to build a refinery 
at least at one time outside of Phoenix. I know that project 
has been going on for 10 years. I don't believe they have 
permits.
    Mr. Sullivan. And we haven't built a refinery in this 
country in, what, 30 years?
    Mr. Cousins. Over 30 years.
    Mr. Sullivan. And we probably need some, don't we?
    Mr. Cousins. Well, you would think. Actually we either need 
them here or they are just going to keep building them 
overseas.
    Mr. Sullivan. Have we ever domestically produced oil that 
we had to actually send somewhere else to be refined in this 
country?
    Mr. Cousins. I am not sure if any--we don't drill any oil. 
We just buy oil on the market. It could be that some Alaskan 
crude was sold. I don't know, but I am not aware of any 
significant oil exports.
    Mr. Sullivan. Your company has delayed a major project due 
to EPA's greenhouse gas regulations. Can you please explain how 
this business decision was made? How were the costs of these 
regulations calculated?
    Mr. Cousins. It is business uncertainty. We went about 
halfway through an expansion project of several hundred million 
dollars. In the climate of Waxman-Markey at the time and the 
fact that even if it was defeated as it was--well, Waxman-
Markey wasn't, but if climate change was defeated, we didn't 
perceive the demand or the margins to justify the expansion we 
were in, not sure enough to bet our entire company's survival 
on it, and the debt load we would have carried would have put 
us in that situation. We actually had to terminate the project 
at the cost of 14,000 man-weeks of construction that was not 
completed in our town, so that is a couple of thousand jobs for 
weeks and weeks.
    Mr. Sullivan. I will start this with all the witnesses. 
What potential EPA regulations coming down the pike are you 
most concerned about from a business perspective? General 
Abbott?
    Mr. Abbott. From a business perspective, what regulations?
    Mr. Sullivan. Yes.
    Mr. Abbott. Well, the greenhouse gas regulations are the 
ones that are posing a huge problem.
    Mr. Sullivan. And in Texas, you are hearing that from 
everybody, huh?
    Mr. Abbott. Well, as I visit with people across the State, 
frankly, it is the overall uncertainty that seems to be 
emanating from the EPA, not knowing what the standards are 
going to be and how to plan for the future.
    Mr. Sullivan. Mr. Alford?
    Mr. Alford. Congressman, I am also a member of the board of 
directors of the U.S. Chamber of Commerce, and I chair the 
regulatory affairs committee for them, and this greenhouse gas 
business is about 70 percent of the discussion, and I believe 
the Chamber has filed a series of lawsuits against EPA 
concerning that.
    Mr. Sullivan. Mr. Rowlan?
    Mr. Rowlan. While I agree that greenhouse gas is a big 
issue and has a lot of impact, I would not discount or put 
anything below that with respect to the new one-hour criteria 
pollutant standards that we are getting along with several MACT 
standards. We are getting hammered from every which direction. 
So I think they are all right there. If one doesn't catch you, 
the other one does, and it is almost like a game of gotcha.
    Mr. Sullivan. And the economy is bad enough, with all this. 
Mr. Pearce?
    Mr. Pearce. I would say the greenhouse gas.
    Mr. Sullivan. Mr. Cousins?
    Mr. Cousins. With my written testimony, I included a slide 
that showed a blizzard of EPA regulatory initiatives. We are 
concerned about all of them, but the PSD and the NSPS portions 
of the greenhouse gas regulations are the most immediate 
concern.
    Mr. Sullivan. Mr. Carter?
    Mr. Carter. I would say the greenhouse gas regulations but 
we should not ignore the other items that are coming out of EPA 
today because some of them may actually have a faster impact on 
utilities in the immediate term. And the reason is, is that we 
do not have commercially available technology to look at our 
plant, and what we have created is a system where there is a 
great deal of uncertainty because even if Ms. Jackson, who I 
have a lot of respect for, even if she goes forward, she does 
not prevent the legal challenges much like we saw on the CARE 
rule. If you are familiar with the CARE rule, it was in place 
for years and then it got vacated and now it is being 
completely rewritten. That is pretty scary if you are in my 
business.
    Mr. Sullivan. That is a very good point.
    Ms. Blaisdell, are there any regulations that concern you 
and your company?
    Ms. Blaisdell. They don't. Actually the EPA has been quite 
helpful to our company, not hurtful.
    Mr. Sullivan. There are no regulations that concern you at 
all about EPA?
    Ms. Blaisdell. The greenhouse gas regulations do not 
concern our company. They don't apply. We don't emit over 
100,000 tons.
    Mr. Sullivan. Thank you, sir.
    Mr. Whitfield. Mr. Scalise, you are recognized--no, I am 
sorry. Mr. Terry, you are recognized for 5 minutes.
    Mr. Terry. Thank you, Mr. Chairman.
    Ms. Blaisdell, thank you for being here, and I don't know 
what, somebody on our side of the aisle evidently insulted you, 
but that is not the way it is supposed to work here. I 
appreciate that Timberland is voluntarily undertaken, and I 
know several businesses in the Omaha metropolitan area that I 
represent that have voluntarily undertaken a variety of energy 
efficiencies in their business too, and we like that. I love 
it. What I don't like is the EPA just assuming that they have 
legislative powers, and that that is what this is about.
    But I do want to make it clear, Betsey, that unlike the 
gentleman that was asking you questions, I am not going to call 
your boss and ask that you be fired for coming here and 
speaking your mind nor like somebody else on the Minority side, 
I am not going to write a letter to a regulatory agency asking 
that they investigate Timberland because you are here. I 
actually think it adds, and I want to state that for the record 
because that is exactly what happened to one of our Minority 
witnesses at a cap-and-trade global warming hearing, and it was 
a constituent of mine so I am always going to stick up for that 
person.
    Getting to Nucor, Mr. Rowlan, thank you. Nucor facility, 
not in my district, but an hour-and-a-half drive and I have 
been up there, I have seen the operation, and would join with 
Mr. Inslee in saying thank you for the efficiencies. I think it 
is a well-run business. Like Timberland, I appreciate that you 
have undergone voluntary measures to reduce your energy costs 
and emissions. Likewise, let me ask you this question under the 
clean air law. Even with all of the efficiencies that you have 
adopted, will one of your recycling plants like the one in 
Norfolk emit more than 250 tons of CO2 in a calendar 
year?
    Mr. Rowlan. Most definitely. We are caught up, all of our 
steel mills like the one in Nucor are caught up.
    Mr. Terry. Is there any way of getting your plants 
considering the smelting, melting processes, to be under 250 
tons of CO2 in a given calendar year?
    Mr. Rowlan. There is no physical law I am aware of that 
could ever cause that to happen.
    Mr. Terry. And you are aware that that is what your 
company, Nucor, would be under the exempted area where it would 
be not 100 tons in a year but 250 tons would be what is 
currently written in the Clean Air Act?
    Mr. Rowlan. We are already a major stationary source.
    Mr. Terry. You understand that rule very well.
    Mr. Rowlan. I understand and live that rule.
    Mr. Terry. And probably, since you understand the rule, 
know that EPA directors just can't willy-nilly change that part 
of the statute. Is that your understanding?
    Mr. Rowlan. I would believe that that was the case, and I 
hope Congress----
    Mr. Terry. If an EPA director can just start willy-nilly 
throwing out, okay, the statute says very clearly and your 
history has been that under the major emitter rule that you 
would qualify under the exemption of 250 tons and then she 
comes around and says something different and enforces that. 
Does that give you more or less certainty in the industry?
    Mr. Rowlan. If we use the 250 tons?
    Mr. Terry. No, if someone, the EPA, this EPA director says 
it is 100,000, the next one starts saying it is 50,000 or 10, 
if that is the power that they have, does that provide you 
certainty?
    Mr. Rowlan. It gives me no certainty at all. I defer to 
what the Attorney General from Texas said. We are a Nation of 
laws and I don't see that it is consistent with the law at that 
point.
    Mr. Terry. I appreciate that.
    And then Mr. Alford, I have some charts regarding the study 
that you have done or your organization that shows the job 
losses, and I am just wondering what the criteria were 
generally to determine that in 2015 you would have a million 
and a half jobs lost and by 2030 it would be pushing 2,500,000 
jobs lost just due to this rule. Because we heard from 
Administrator Jackson that it is going to be actually a job 
creator, but you are showing job losses. How do we jibe those 
two?
    Mr. Alford. Well, we spent some good money on that study 
from Charles River Associates. That is a very reputable firm 
based here in Washington, D.C., and that was done early 2009. 
We have shown it to the world, and we have not had one person 
or entity challenge those studies that are in that study, the 
charts.
    Mr. Terry. So you are standing behind your study?
    Mr. Alford. Absolutely.
    Mr. Terry. All right. Thank you very much.
    Mr. Whitfield. Thank you, Mr. Terry.
    At this time I recognize Mr. Scalise for 5 minutes.
    Mr. Scalise. Thank you, Mr. Chairman.
    Mr. Rowlan, I first want to thank you for the commitment 
you made to create jobs in America but specifically in 
southeast Louisiana, and we really appreciate the presence of 
Nucor. I think you were here when I had a conversation with Ms. 
Jackson about her report, that she stated that these 
regulations will create jobs, and I think she tried to use 
Nucor as a poster child for how these new regulations will 
actually grow the economy and yet I know in your testimony, you 
talked about the opposite, and believe me, yours is not an 
isolated example. I hear this day in, day out of companies that 
talk about the burdens of EPA and how it runs more jobs out of 
the country, and I know in your testimony you talked about the 
larger presence of American jobs that would have been created 
here if not for the threat of EPA. So I wanted to first thank 
you, of course, but also give you an opportunity to talk about 
that specifically in her comments of using you all as the 
poster child for how this is working so well yet it seems to 
contradict what is actually happening in reality.
    Mr. Rowlan. Well, are you speaking of our Nucor Louisiana 
project, and yes, we had originally planned to build, I think 
it was the first two blast furnace operation permitted under 
the Clean Air Act along with coke ovens and cinder plants and 
produce 6 million tons of pig iron. We now have reduced that 
project and that is moved off to phase 2 if we do get the final 
permit on that.
    Mr. Scalise. So you are still waiting on a permit from EPA?
    Mr. Rowlan. That permit has been issued but it is stayed 
until the litigation over it is completed. There are a couple 
of lawsuits going on right now against Louisiana Department of 
Environmental Quality. The replacement project was a direct 
reduced iron project, and so that people can understand, if you 
say we were going to build pickups at the original facility, 
what we ended up making are, I don't know, bicycles or 
something like that. This is a different product. It is still 
iron but it is a different product, and it is significantly 
different in the overall employment impact. I think we had----
    Mr. Scalise. Can you touch on that? What would the jobs 
have been versus what they will be here in America?
    Mr. Rowlan. I believe the original was around 1,000 jobs 
when the full project was in, and we are around 150 jobs right 
now. I think that is right. And then there was about 2,000 
construction jobs originally and we are at about 500 
construction jobs right now, around 2.1 billion and we are 
around 750 million right now.
    Mr. Scalise. So you are talking about well over a billion 
and a half dollars roughly that was lost in investment, 1.25 
billion maybe that was lost in investment----
    Mr. Rowlan [continuing]. Not moving forward with it at this 
point. It is still in phase 2. We would hope to be able to do 
that at some point.
    Mr. Scalise. What is the average pay for those jobs, the 
thousand you were originally anticipating versus the 150 now? 
What is the average pay of those jobs?
    Mr. Rowlan. Our publicized average pay at a Nucor facility 
is $70,000 a year.
    Mr. Scalise. Gee, whiz. Well, these are great jobs, and 
unfortunately, a lot less of them right now because of the 
regulations. Again, I have heard the story time and time again 
and EPA will come out and say the regulations are creating 
jobs. Maybe what they are not realizing is, it is jobs in China 
and India that they are creating, not here in America. So I 
appreciate what you are doing. I share your frustration, and we 
are going to continue to work through and get real clarity so 
that businesses can go forward.
    Mr. Cousins, there was some comment earlier by another 
member talking about how the Energy Tax Prevention Act would 
somehow lead to increased dependence on Middle Eastern oil. Of 
course, this Administration's policies have led to an increased 
dependence on Middle Eastern oil and higher gas prices. The 
bill, in my opinion, would actually at least give some 
sustainability and hopefully we can then get to a point where 
we reduce our dependence, but do you see anything in the 
legislation that would increase this country's dependence on 
Middle Eastern oil?
    Mr. Cousins. No, not at all. I think acts already carried 
on by Congress and by the EPA, CAFE standards increase have cut 
fuel use quite a bit. Renewable fuel standard is putting 36 
billion gallons of non-gasoline into the gasoline and diesel 
supply through the next few decades. I think everything is 
tending toward a reduction.
    Mr. Scalise. And in fact, when Administrator Jackson agreed 
with that comment, I thought it undermined the credibility to 
say that a bill that prevents EPA from shutting jobs out of 
America, running more refineries to India and other places, for 
her to suggest that that increase our dependence on foreign oil 
when actually it is EPA's actions that increase the dependence.
    And the final question, can you talk in terms of the jobs 
that you haven't been able to create, the expansion that you 
haven't been able to do because of EPA's regulations?
    Mr. Cousins. Well, as I said earlier, we were partway 
through a multi-hundred million dollar expansion in a small 
town. There were about 14,000 man-weeks, which would be one 
person working for 14,000 weeks on the job to complete the 
construction, or 2,000 people working for 2 months. We just had 
to stop, and those people were terminated, and that is a big 
hit in a county where we lost 2,000 jobs out of 40,000 workers 
in a poultry operation that shut down.
    Mr. Scalise. Well, hopefully we can pass this legislation 
and save those jobs. I appreciate your testimony. I yield back.
    Mr. Whitfield. Thank you.
    Mr. Olson of Texas for 5 minutes.
    Mr. Olson. Thank you, Mr. Chairman, and I can assure the 
witnesses and all the people here watching this hearing that I 
am the last Texan that is going to speak today, and we are 
Texans, we are very proud and please bear with us.
    But I would like to speak to General Abbott, and first of 
all, sir, I would like to thank you for what you have done for 
our State to create an environment that we do have some 
stability, some predictability, some certainty, and I greatly 
appreciate that.
    One of the things all of us when we go back home, one of 
the biggest concerns our constituents have is jobs, jobs, jobs, 
and as my colleague Gene Green said, our State has had the good 
fortune of creating half the private sector jobs since our 
economy went into a recession, half the ones here in America. 
My colleagues Joe Barton and Mike Burgess have told us about 
the success of the flexible permitting system. Our air is 
demonstrably cleaner. There is no doubt about that. We have the 
facts. And I know personally because I moved to Houston in 
1972, and our general grew up in Houston as well and it wasn't 
such a clean town. I mean, you could not see downtown from 20 
miles out when I came out of Clear Lake and headed towards 
downtown. Now that is the exception maybe one or two days 
during the summer that that exists. Most every day you can see 
downtown, so that is just demonstrably cleaner from my own 
personal experience. Our process has worked. You would think we 
would be a role model for the country, here is how we can get 
through this, here is how we can have a cleaner environment and 
a good environment for business and be clean. But it concerns 
me that what is doing with this excessive regulation, how that 
is coming into our economy in Texas.
    Attorney General Abbott, do you see a tipping point here? I 
mean, if they keep going forward down this line with all this, 
the flexible permitting, some of the hydraulic fracturing 
issues, some of the other issues, the ozone standards, do you 
see a turning point here where the environment that the Federal 
Government creates starts killing jobs in our State?
    Mr. Abbott. Well, a couple things. If I could pick up on 
one of your earlier comments, first of all, to help people 
understand, people see Texas challenging the EPA both 
regulatorily and with lawsuits, but I want to emphasize a point 
that you made, and that is that Texas takes pride in trying to 
achieve the best. That includes achieving the best possible 
environment and health environment for our citizens, and as a 
result, that is one reason why we have worked so hard and 
achieved so much in improving air quality in your district and 
across the State of Texas, and we stand committed to continuing 
to achieve improvements in air quality and the environment, but 
that doesn't meant that we are going to stand aside or roll 
over if we believe that the EPA is imposing its will in a way 
that is contrary to the law.
    You mentioned a tipping point, and there is another phrase 
you could also use in tandem, and that is a slippery slope. We 
are very concerned about the slippery slope. I think it was 
Representative Terry who brought up earlier in the context of 
the tailoring rule, and we are very concerned about what the 
tailoring rule could turn into once it starts moving on a 
slippery slope where it gives latitude to the EPA to decide 
what the standards may be. It could shift from today to 5 years 
from now to 10 years from now and it could very well bring in 
Nucor and some other industries within the gambit of what they 
are able to emit.
    But I think we are at a tipping point also because if these 
greenhouse gas regulations by the EPA go into place or upheld, 
we are a tipping point in two ways. One, it means that the EPA 
does have carte blanche to make up its own rules as they go 
along and that they are saying they are not confined by the 
terms of the Clean Air Act that was passed by the United States 
Congress. But also we are at a tipping point in the sense of 
what it is going to mean for our jobs, our economy and the 
future of this country when we have out-of-control regulations 
that are crushing the attempt to expand our economy at a time 
that we most desperately need it to grow.
    Mr. Olson. Thank you for that answer, Mr. Attorney General. 
You are a great public servant.
    I have about run out of time. Thank you to all the 
witnesses. I appreciate your views and perspectives.
    Mr. Whitfield. Mr. McKinley, you are recognized for 5 
minutes.
    Mr. McKinley. Thank you. I am coming from the perspective 
of the coal fields of West Virginia and what the EPA has done 
in the coal fields, the uncertainty that is coming to them from 
water, fly ash, dust, revoking retroactively permits. Then I 
see the next fight looming on the horizon is not going over 
into another segment with the EPA and the uncertainties that 
they bring with their regulatory extremism. We have all heard 
in West Virginia job killers, the extreme, irrational lack of 
common sense. It is bad enough for us in the coal fields. What 
happens when it sweeps across America controlling the 
greenhouse gases? So you all have--understand, there are still 
15 million people unemployed and until the uncertainty is 
removed, I have got to think you are reluctant to take on more 
responsibility. So we are going to continue having 15 million 
people unemployed in America. That is not where I want us to be 
as a country.
    So now, having framed that, you have all been listening for 
hours here of testimony today. I am just curious, are any of 
you more confident in what you have heard from either the other 
side or here that things are going to be okay, allow the EPA to 
continue down this path of regulating the greenhouse gases? Can 
each of you just, are you more comfortable now after you have 
heard 2 hours?
    Mr. Abbott. Let me say that I grew more comfortable when I 
saw this bill, this Act being proposed by this subcommittee. 
The concern that we had in Texas was the imposition of the 
greenhouse gas regulations. We perceive that the most 
meaningful way, the most meaningful pathway in order to protect 
the future was not by our litigation fights in the courthouse 
against the EPA but by action by this body. The promise of the 
future rests with regard to this potential legislation, and we 
hope that it passes because we believe it will provide 
certainty and clarity for the environment regulation side of 
the world.
    Mr. McKinley. Thank you. Mr. Alford?
    Mr. Alford. I have optimism in that Carol Brown has left 
the Administration, which I believe was pulling or pushing Ms. 
Jackson, who is a fine lady and a fine American, but the cap-
and-trade bill died. The American people rejected it. It is 
gone. You can't have it. So you can't go around through 
chicanery or deception or end around or making the EPA a 
runaway freight train to make it happen, and we have got to 
stand tall and be resolved to fight it again.
    Mr. Rowlan. I can't say that I have more certainty. I think 
I will watch for the votes. I think my issues always go back to 
this, and it is whether--I am a technical person and an 
engineer by training, and when I look at it, I always look at 
what is the end result that you are trying to achieve, and 
everything that I have seen with respect to the regulation of 
greenhouse gases, nothing ever accomplishes the end goal of 
lowering the global concentration, and so the question I ask 
is, why do we do it if it not going to accomplish what we state 
is the end goal? And I have gone on record as saying if we are 
doing it and we are just doing it to hurt ourselves and we 
don't accomplish a lowering of the global concentrations, we 
are on a fool's errand.
    Mr. McKinley. Thank you.
    Mr. Pearce. I am encouraged by what this legislation and I 
am encouraged by the support that we have heard for it today, 
but I am concerned that if we don't pass this, if it is not 
legislative, what kind of ticket that does that write for the 
EPA and other areas? It sets a precedent.
    Mr. Cousins. The Energy Tax Prevention Act gives us a 
fighting chance. Without it, the future is quite grim.
    Mr. Carter. I am encouraged because we are considering this 
piece of legislation. That is why I am here today. I would 
point out that there are things that we can do that could be 
done if we want to adopt policy that will allow electric 
utilities to move forward fewer emissions like the things that 
we are doing--new nuclear plants, which still have a great deal 
of hurdles in front of them, not from a technology perspective 
but from a regulatory perspective. I can speak directly to that 
as being part of that restart.
    Also, industry or entities like us, we need to make sure we 
have the comparable incentives so that we can move into what I 
would call other green types of resources and clear some of the 
regulatory hurdles associated with those also.
    Ms. Blaisdell. I think this legislation encourages 
inaction, and I don't believe that that creates more certainty, 
and in fact, it could lead to more patchwork of State 
regulations, which I can't speak to greenhouse gas patchwork of 
State regulations because that hasn't applied to our company 
yet other than to say I know from experience with other 
patchwork of regulations that that is not good for our company. 
I imagine that wouldn't be good for the companies that are 
represented here as well.
    Mr. Whitfield. Mr. Gardner, you are recognized for 5 
minutes.
    Mr. Gardner. Thank you, Mr. Chairman, and thank you to the 
witnesses for being here today, taking time away from work and 
for participating in this hearing. I really appreciate it.
    Mr. Cousins, I have a question for you from your testimony 
earlier today. During Administrator Jackson's testimony, she 
said that the economy was doing great, and when I pushed back a 
little bit on that question, she said just the rural economy is 
doing great, and you had mentioned that in your county you are 
facing some significant unemployment. Could you describe that 
again?
    Mr. Cousins. Well, our county has about 43,000 people in 
it, and we lost almost 2,000 jobs in one blow when a poultry 
operation shut down in our area. Our unemployment is double 
digit, and that is hardly thriving to our way of thinking.
    Mr. Gardner. And is it your view, Mr. Cousins, that 
regulations like this will hurt rather than help the employment 
situation in your county?
    Mr. Cousins. Absolutely.
    Mr. Gardner. And a question for Mr. Rowlan or Mr. Pearce. 
There was some discussion during the Administrator's testimony 
that these regulations are actually creating jobs, that the 
more we have regulations, the more jobs are created, and she 
also mentioned, and I think it was $2 trillion in money that is 
sitting out waiting to be invested and she believe that because 
of this regulation that that money would start moving back into 
the economy and being invested. Are any of you planning on 
investing because of this regulation? Ms. Blaisdell?
    Ms. Blaisdell. The cost of inaction for us means that our 
supply chain will suffer and our ability to deliver products to 
our consumers will suffer as well.
    Mr. Gardner. Mr. Carter or Mr. Alford, anybody else want to 
comment on that?
    Mr. Alford. Some of my stronger members are going to Ghana, 
Kenya, China. I have got a board member going to Mongolia next 
month. They are looking elsewhere, and I think that is sad.
    Mr. Gardner. And a question, do you believe that 
regulations create jobs?
    Mr. Alford. Regulations, I believe, are intended to prevent 
crime and fraud and adherence to good corporate responsibility. 
That is it.
    Mr. Gardner. I thank you. And I wanted to ask a few more 
questions based on some statements that were made here in the 
committee, following up on that last question. The EPA analysis 
mentioned by some on this committee had said that just one of 
EPA's Clean Air Act standards has kept about 200,000 people 
occupied, 200,000 person-years of labor over the past 7 years, 
and in your opinion, doesn't this mean that this means the EPA 
is keeping people employed? I mean, what would you say to 
somebody who actually is trying to bring capital investment 
into this country, given the regulatory structure that we are 
facing today? Mr. Abbott or Mr. Alford?
    Mr. Abbott. Along that line, it is good for jobs in the 
legal sector. We will need more lawyers to handle more legal 
work. But other than that, of course, with the way that 
greenhouse gases work and if we have regulations here in the 
United States and there are not similar regulations around the 
world, logically it seems like it is going to force industry, 
jobs, employers across the border into Mexico or Canada or to 
China and India and other parts of the world.
    Mr. Gardner. Thank you, Mr. Chairman. I yield back my time.
    Ms. Blaisdell. Can I respond as well?
    Mr. Whitfield. Sure.
    Ms. Blaisdell. I think without a lack of certainty, what 
ends up happening is what we are seeing right now in China 
where they are actually producing renewable energy systems 
because we didn't create any certainty here, a long-term demand 
for those alternative energy sources. We haven't talked about 
those jobs today. That could have been U.S. jobs.
    Mr. Whitfield. Mr. Griffith, you are recognized for 5 
minutes.
    Mr. Griffith. I think Mr. Rowlan wanted to add something to 
that comment, I will ask you to say whatever it is you were 
thinking.
    Mr. Rowlan. As you know in my testimony I said that 
affordable energy is the lifeblood of industry, and renewable 
energy has to be affordable. If it isn't affordable, then all 
it does is displace a job because the price of your energy goes 
up as we talked about, and I was privy to some research that 
should be coming out shortly that in the last couple of years 
there has been 333 projects, energy generation projects that 
have been stalled, shut down, or otherwise abandoned in this 
country, 111 coal-fired power plants, 22 nuclear plants, 21 
transmission projects, 38 gas and platform projects and 140 
renewable projects that haven't even gotten through. Eighty-
nine of those were wind, four were wave, 10 were solar, seven 
were hydro and 29 were biomass. Now, if you sit and we said we 
got all that energy and let us just take the affordable part of 
it and not the renewable unaffordable part of it, if we got 
that energy, look at the jobs that would begin to create 
because that energy goes out and that creates industry which 
builds things, which makes jobs and that just continues to roll 
forward.
    But the sad part of this is, 45 percent of those 333 
projects are renewable projects and we can't even get them 
permitted without the greenhouse gas rules. Now, let us add 
another brick onto that burden and let us see if that mule can 
walk.
    Mr. Griffith. Thank you.
    General Abbott, I am a lawyer or a recovering lawyer. Now 
that I am doing this, I can't practice anymore. But I have read 
the Massachusetts v. EPA decision, and you obviously have too, 
and I looked at that next-to-last sentence where it says ``We 
hold only that the EPA must ground its reasons for action or 
inaction in the statute.'' Now, earlier today when I was 
speaking with Ms. Jackson, she indicated that the reason that 
they had changed instead of it being 100 of 250 to 100,000 in 
their tailoring was because if they had enforced the law as 
written, it would be absurd, and I agreed with her on that. But 
I guess my question to you is, is that she said that they felt 
that because it was going to be an absurd result, that they had 
the authority to change the rule, so to speak, and I went to 
law school, I never got that class, and I am just wondering if 
I missed something over the years or maybe you knew, is there 
authority for a bureaucracy to change the law because they end 
result would be absurd or is that the duty of the legislative 
branch of government?
    Mr. Abbott. As I understand it, their legal argument is 
based upon what would be called the absurdity doctrine. As 
understand it, the absurdity doctrine is not a valid legal 
doctrine for them to base their decision on and it is more like 
a hope and a prayer that they can get away with changing the 
clear language established by Congress in the Clean Air Act. 
This is a way in which there is an evasion of the law and a 
creation of new law by the EPA.
    Mr. Griffith. And in that vein, am I not correct that once 
she made the determination that there was an endangerment, she 
needed to apply the rules to all 6 million businesses that 
would come under the 100 or 250 regulation and that by not 
doing so if someone were to sue, all 6 million in that universe 
would come under the law and that that would create chaos, I 
mean, not just damage the economy but create sheer chaos in the 
economy, and isn't it then better that we pass this legislation 
so that we can then have that argument in the halls of Congress 
instead of having the fear that at some point in the future a 
court is going to rule that you have to apply it to all--
whatever rules they come up with apply to all 6 million in the 
universe and that 6 million is of course her number.
    Mr. Abbott. Right. You are absolutely correct. Our great 
concern is that the tailoring rule is going to be challenged, 
not just from our side but also from those who really want to 
decrease those thresholds, thereby making schools, farms, 
hospitals, small businesses, literally thousands upon thousands 
of job creators and employers across the country suddenly 
subject to these limitations, almost stifling overnight our 
economy.
    Mr. Griffith. And the solution would be passage of this 
bill?
    Mr. Abbott. The solution has to be the passage of this 
bill.
    Mr. Griffith. I thank the gentleman and yield back whatever 
time I have left.
    Mr. Whitfield. Mr. Griffith, thank you very much, and I 
want to thank the panel. We genuinely appreciate your taking 
time to come and talk to us about practical issues as we try to 
balance environment protections, health care and economic 
development, and your testimony on job creation was very 
important and we appreciate it, and so I will dismiss this 
panel. Ms. Blaisdell, I asked them to get these newspaper 
articles that Mr. Shimkus referred to, if you all would like to 
see them.
    We will call up the fourth panel, and on the fourth panel 
we have Peter Glaser, a partner with Troutman Sanders; Dr. 
Margo Thorning, Senior VP and Chief Economist, American Council 
for Capital Formation; Mr. Philip Nelson, President of the 
Illinois Farm Bureau; Mr. Fred Harnack, General Manager, U.S. 
Steel Corporation; Mr. James Goldstene, Executive Officer, 
California Air Resources Board; and Dr. Lynn Goldman, American 
Public Health Association. I want to thank you all very much 
for being with us. We appreciate your patience. We are going to 
declare you honorary members of the Energy and Commerce 
Committee because you have been here so long. And then at this 
time Mr. Glaser, I will call upon your for your 5-minute 
opening statement, and then we will get to questions after 
that. Mr. Glaser, thank you for being here.

STATEMENTS OF PETER S. GLASER, PRESIDENT, TROUTMAN SANDERS LLP; 
DR. MARGO THORNING, SENIOR VICE PRESIDENT AND CHIEF ECONOMIST, 
    AMERICAN COUNCIL FOR CAPITAL INVESTMENT; PHILIP NELSON, 
   PRESIDENT, ILLINOIS FARM BUREAU; FRED T. HARNACK, GENERAL 
 MANAGER, ENVIRONMENTAL AFFAIRS, U.S. STEEL CORPORATION; JAMES 
   N. GOLDSTENE, EXECUTIVE OFFICER, CALIFORNIA AIR RESOURCES 
    BOARD; AND DR. LYNN R. GOLDMAN, AMERICAN PUBLIC HEALTH 
                          ASSOCIATION

                  STATEMENT OF PETER S. GLASER

    Mr. Glaser. Thank you very much, Mr. Chairman. Members of 
the committee, I appreciate the opportunity to testify here 
today. My written testimony, which is very detailed, provides 
an analysis from a legal standpoint of why the Clean Air Act is 
such a poor vehicle for addressing greenhouse gas emissions, 
and I will just summarize some of my points there.
    I want to emphasize at the outset that I am not 
representing any of my clients here today. I am not being 
compensated for this testimony, and the views I express here 
are my own and do not necessarily reflect the views of my 
clients.
    I also want to say at the beginning that my testimony has 
nothing to do with the science. Whatever you feel about the 
science either way, if you believe in the science one direction 
or another, my testimony still works.
    The main problem with regulating greenhouse gas emissions 
under the Clean Air Act, even if you think that greenhouse 
gases is something that the country needs to regulate, is that 
the statute was not designed for that purpose, and as a result, 
EPA's regulatory aims do not comfortably fit within the 
programs that are in the Clean Air Act. We know this because 
EPA itself has said that regulating greenhouse gases under the 
literal language of the statute, as we have heard many times 
today, creates an absurd result. If you use the statute, you 
get an absurd result, and the only way to avoid this is for EPA 
to tailor the statute itself. You have to change the statute.
    Just putting aside legal arguments about whether or not EPA 
could do that, the problem is that EPA has been forced to 
engage in this kind of creative legal interpretation in this 
area and in several other areas that are set forth in my 
testimony, and all of this shows is that EPA is trying to make 
the statute do something that it was not designed to do. And so 
what you get from this are lawsuits and you get regulatory 
uncertainty, and in the end what might happen if EPA is wrong 
is that you end up unleashing regulation on a very, very large 
number and variety of small emitters.
    Indeed, we may be facing more absurd consequences of trying 
to regulate under this statute. As EPA confronts a petition to 
regulate greenhouse gases under the National Ambient Air 
Quality Standards. I actually thought the single most 
disturbing thing that I heard today having sat here all day was 
the Administrator's statement that in fact they may get forced 
into establishing a greenhouse gas National Ambient Air Quality 
Standard. Unfortunately, the only legal precedent on the books 
on this would seem to be point to a necessity that they do 
that. This is set forth in more detail in my testimony. That 
would create truly severe economic consequences under a program 
that could never be complied with. That is very concerning.
    Now, importantly, and there has been some discussion of 
this today, EPA has not done an overall comprehensive 
assessment of the cumulative costs and benefits of all of the 
greenhouse gas regulation that it has in mind nor has EPA set 
forth its overall plan of regulation where it lists out in 
advance for everybody to see what the requirements will be, 
what categories of sources that they intend to regulate, what 
programs they intend to regulate under and what the full 
regulatory timetable is. We heard the Administrator say today 
that they are taking this on a rule-by-rule basis but that they 
can't anticipate what all the rules will be because they don't 
know what all the rules will be. We heard her say that they got 
petitions, multiple petitions to regulate different sources. 
They don't know how they are going to act on that. We heard her 
say that they are going to be doing cost-benefit analysis but 
only in the context when they get to actual rules.
    Now, all this is despite the fact that they have a 5-year 
plan. EPA has a 5-year strategic plan, and goal number one of 
the 5-year strategic plan is taking action on climate change 
and air quality. So presumably they have a plan but they have 
not told us in advance what the specific elements of the plan 
are. As a result of all of this, we are in the process, we have 
started down this path of one regulation after another, but 
before we decided to do that in the first place, we never 
assessed what the overall cost and consequences and benefits 
were going to be, and this to be should be very concerning 
because it contributes to the large uncertainty of where 
exactly the Nation is going.
    You know, one flaw with proceeding on a rule-by-rule basis 
and trying to determine what the costs and benefits of 
regulation are can be seen in their first foray into greenhouse 
gas regulation. Their first foray, of course, was the motor 
vehicle, the tailpipe rule. In the tailpipe rule, they assessed 
the costs of the tailpipe rule on the motor vehicle industry. 
They also said that the tailpipe rule automatically and as a 
matter of law triggers greenhouse gas regulation of large, 
stationary sources. But there was no study as to what those 
regulations were going to be and what the cost was going to be. 
So as we have started out as of January 2nd in regulation 
greenhouse gases under these programs, we still have no overall 
assessment of whether the benefit will exceed the cost.
    Mr. Whitfield. If you would summarize, Mr. Glaser?
    Mr. Glaser. Sure. I think the overall question for this 
committee is what part of government should make the critical 
policy choices that are inherent in determining how the Nation 
uses energy. To me, this is the main issue before this 
committee. Should it be EPA under a statute that they are 
relying on that was enacted in 1970 or should it be Congress? 
Thank you.
    [The prepared statement of Mr. Glaser follows:]

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    Mr. Whitfield. Thank you very much.
    Dr. Thorning, we look forward to your testimony.

                  STATEMENT OF MARGO THORNING

    Ms. Thorning. Thank you, Mr. Chairman, and thank you, 
Ranking Member Rush, and I apologize for misidentifying in you 
my written testimony. I would like to correct that for the 
record.
    Thank you very much for the chance to appear before you. I 
just want to talk about five points in my testimony. First, the 
U.S. economy is recovering sluggishly. GDP grew only at 2.9 
percent last year. The unemployment rate remains stubbornly 
high at 9 percent. And investigation right now is about $354 
billion less than it was in the fourth quarter of 2007. 
Investment spending is responsible for most of the drop in 
gross domestic product over the last 2\1/2\ years or so. So 
clearly that is a key issue.
    Looking at the historical data, each $1 billion drop in 
investment spending is associated with a job loss of 15,500 
jobs, and vice versa. Each $1 billion increase is responsible 
for over 15,000 new jobs.
    The second point, regulating greenhouse gases under the 
Clean Air Act is likely to have a negative impact on overall 
business spending. When a business is contemplating a new 
investment, they look at the risk of that new investment. They 
may add a risk premium to their cost of capital, anywhere from 
zero to as much as 50 percent or more, assuming that the risk 
premium associated with investments that are in industries 
regulated by EPA might be 30 to 40 percent. We looked at the 
impact of that on business investment in the quarter or so of 
investment that is accounted for by these regulated entities 
that are regulated by EPA. We conclude that there could be a 
fall in investment spending annually of between $25 and $75 
billion. When you feed those numbers into IMPLAN, input-output 
model, you get--it is an input-output model that accounts for 
all the dollar flows across all sectors in the United States. 
When you feel those drops in investment which we assumed either 
$25 billion annually or $75 billion, you get a decrease in jobs 
of approximately 476,000 to, on the high side, 1.4 million 
fewer jobs annually and you get a loss of GDP of between 47 
billion and 141 billion annually. Interestingly, the job 
numbers that we obtained by looking at the historical data were 
about 15,5000 jobs tabulate very nicely with the IMPLAN results 
which suggest that for each $1 billion drop in investment, we 
lost about 17,000 jobs. So using two completely different 
approaches, we get the same impact for this drop in investment 
spending that we expect will occur as a result of these 
regulations.
    Fourth, mandating energy efficiency, as EPA seems to want 
to do under the BACT guidelines is unlikely to lead to job 
growth. First, as many companies testified in the panel just 
before us, they have already made energy efficiency 
investments. They do it when it makes economic sense, and when 
it is time to replace their capital stock if they can a more 
energy-efficient investment that makes sense, they do it. They 
don't need a government mandate to make them increase energy 
efficiency. And second, the argument that market failures and 
inefficiencies or technical barriers are responsible for 
companies not taking up energy-efficient investment is, I 
think, unfounded. Companies do make those investments. Overall, 
the results suggest that mandating energy efficiency is not 
going to be a net job generator.
    And fifth, the BACT guidelines issued in November are not 
likely to reduce uncertainty and they will not reduce the risk 
premium in the cost of capital that companies contemplating 
investment or expansion face because, for example, the specific 
standards for BACT are not established by the new guidelines. 
That means industries don't really know what will be required. 
And another example, the permitting agencies are required to 
retain discretion to determine BACT on a case-by-case basis 
subject to EPA or court review. Thus, regulated entities will 
encounter different requirements depending on the individual 
State regulator's approach.
    So in conclusion, I think using economic analysis, it 
suggests that regulating GHGs under the Clean Air Act is likely 
to slow investment, slow job growth and not have any impact on 
global greenhouse gas concentrations. Consequently, it makes 
little sense for EPA to proceed down this path. Thank you.
    [The prepared statement of Ms. Thorning follows:]

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    Mr. Whitfield. Thank you, Dr. Thorning.
    Mr. Nelson, you are recognized for 5 minutes.

                   STATEMENT OF PHILIP NELSON

    Mr. Nelson. Mr. Chairman, members of the subcommittee, good 
afternoon. I am Philip Nelson. I am a fourth-generation grain 
and livestock farmer from Seneca Illinois. I am also President 
of the Illinois Farm Bureau and a member of the Board of 
Directors of the American Farm Bureau Federation. I am 
appearing today on behalf of the American Farm Bureau 
Federation.
    I am pleased to testify in support of the Energy Tax 
Prevention Act of 2011. It is one of several bills from both 
sides of the aisle in both the House and the Senate that are 
designed to allow our elected representatives in Congress to 
decide how and to what extent our Nation will address 
regulation of greenhouse gases. Farm Bureau opposes the 
regulation of greenhouse gases by the Environmental Protection 
Agency under the Clean Air Act and we commend the chairman for 
giving this matter a high priority.
    Farmers and ranchers receive a double economic jolt from 
the regulation of greenhouse gases from stationary sources. 
First, any costs incurred by utilities, refiners, 
manufacturers, and other large emitters to comply with the 
greenhouse gas regulatory requirements will be passed on to 
consumers of those products, including farmers and ranchers. To 
a large degree, farmers and ranchers cannot pass along these 
increased costs of production. Farmers and ranchers will also 
incur direct results as a result of the regulation of 
greenhouse gases by EPA. For the first time, many farm and 
ranch operations will likely be subject to direct new source 
review/prevention of significant deterioration construction 
permits and Title V permit requirements under the Clean Air 
Act. For example, Title V of the Clean Air Act requires that 
any stationary source including farms and ranches that emits or 
has the potential to emit more than 100 tons of a regulated 
pollutant per year must obtain an operating permit. To meet 
this requirement, thousands of farms and ranches will be 
required to obtain the Title V operating permits. EPA itself 
estimates that just at the expense of obtaining Title V 
operating permits, it will cost production agriculture $866 
million. That does not include other associated permit costs.
    Livestock producers would be especially impacted by these 
permit requirements. The USDA has stated that approximately 90 
percent of the livestock produced in this country are above the 
permitting thresholds and will be required to obtain operating 
permits. Under the EPA tailoring scheme, farmers and ranchers 
would still incur costs passed down from utilities and larger 
emitters upon which they depend for energy and fuel. Farmers 
and ranchers that meet the low Clean Air Act thresholds will 
also eventually be required to obtain permits.
    On the other hand, this costly and burdensome regulatory 
scheme will produce very little, if any, environmental benefit. 
Greenhouse gases are distributed evenly around the globe so 
that a ton of greenhouse gases emitted in Illinois is no 
different than a ton of greenhouse gases emitted in China. 
Regulation of greenhouse gases emitted in Illinois means little 
if emissions in China are not similarly regulated. Unless and 
until the countries of this world agree on an international 
treaty on greenhouse gas emissions, unilateral regulation of 
greenhouse gases by EPA will have little environment effect, a 
fact publicly acknowledged by the EPA Administrator. Both the 
President and the Administrator of EPA have stated that the 
regulation of greenhouse gases by EPA under the Clean Air Act 
is not an effective way to address the issue. Most state that 
they prefer that the issue be addressed by Congress.
    The Energy Tax Prevention Act recognizes this fact and 
applies the brakes to this process, thus restoring the 
jurisdiction of Congress to develop climate policy. Thank you.
    [The prepared statement of Mr. Nelson follows:]

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    Mr. Whitfield. Thank you, Mr. Nelson.
    Mr. Harnack, you are recognized for 5 minutes.

                  STATEMENT OF FRED T. HARNACK

    Mr. Harnack. OK. Good afternoon. Mr. Chairman and members 
of the committee, thank you for this opportunity to testify. I 
will briefly summarize my remarks, and I am pleased to have 
supplied a detailed written statement for the record.
    My name is Fred Harnack and I am General Manager of 
Environmental Affairs for United States Steel Corporation. My 
career spans over 30 years in steel technology and 
manufacturing facilities, some of which are located in Mr. 
Dingell's and Mr. Doyle's districts. I have witnessed 
environmental management practices developed in tandem with 
implementation of the Clean Air Act. On balance, the Clean Air 
Act has been a force for positive change across industrial 
America.
    Today, I am especially proud to represent our company and 
over 21,000 domestic and 42,000 total employees at U.S. Steel. 
My company provides employees and their families good-paying 
jobs and benefits that make the American dream attainable. We 
also support pension and health benefits for more than 100,000 
retirees and their dependants. Ours is an industry worth 
fighting to keep.
    I assure you every one of us wants to work, live and raise 
our families in a clean and safe environment. We are committed 
to making steel with that in mind and install environmental 
stewardship through all our business processes. That said, we 
believe the time has come to reassess the complex framework of 
rules and regulations that hamstring responsible manufacturers 
and inhibit economic growth and job creation.
    U.S. Steel is an integrated steel producer. Our process 
begins with iron ore, carbon in the form of coke, and 
limestone. We transform these materials through a highly 
efficient, high-temperature blast furnace to create iron which, 
with the addition of recycled steel scrap metal, is converted 
to cast steel. We produce flat roll sheet and tin products and 
seamless and welded pipe that is used in automotive, 
construction, container and energy industry applications.
    As Congress looks for ways to reduce unemployment and 
attempt to recover more than 8 million manufacturing jobs lost 
since the year 2000, the regulatory burden will be a target-
rich environment. The recent spate of new rules to regulate 
greenhouse gas emissions under the Clean Air Act is a good 
place to start because these rules have not yet had the chance 
to inflict their harm on jobs and the economy.
    Greenhouse gas emissions are not like the pollutants 
targeted under the Clean Air Act. Regulating these emissions 
from stationary sources under the existing Clean Air Act will 
not yield the past successes achieved for other pollutants. In 
fact, the Clean Air Act makes no provision to address the 
anticompetitive regulatory costs imposed on domestic 
manufacturers of globally traded goods. This will likely lead 
to a perverse outcome that puts the most efficient American 
manufacturers at a disadvantage to unburden foreign producers 
while actually contributing to a net increase in global 
greenhouse gas emissions. I am convinced that jeopardizing 
American jobs for a worse environment is not in our best 
interest.
    Our substantial experience complying with the Clean Air Act 
tells us that Title I and Title V programs were probably never 
intended to regulate global greenhouse gas emissions. In our 
world, this is the proverbial attempt to stick a square peg in 
a round hole. The committee's discussion draft dated February 
2, 2011, would prevent substantial economic harm by removing 
greenhouse gas emission regulations under the Clean Air Act.
    Over the coming months, we urge Congress to hold hearings 
on other aspects of the Clean Air Act. In this regard, we would 
suggest five areas worthy of your further study and 
investigation. These include first of all the cumulative impact 
of Clean Air Act regulations, and I just wanted to note that my 
written statement provides a detailed list of the many new and 
emerging air pollution rules applicable to and affecting the 
steel industry, and you have heard them many times referred to 
also today; secondly, the role and expectations including costs 
of technology in controlling various pollutants; third, the 
efficiency and effectiveness of U.S. EPA's guidance and testing 
methods; fourth, the best strategies for addressing multimedia 
and multipollutant impacts; and finally, staffing levels and 
competencies in the responsible State and federal regulatory 
agencies to ensure permitting can move with the pace of 
commerce.
    As Americans, we all understand that government regulation 
is designed to impose certain responsibilities on targeted 
entities. Our collective challenge, however, is to achieve an 
optimal balance of cost and benefit. When companies like mine 
are required to spend the lion's share of our capital budgets 
on infrastructure and satisfying compliance obligations, it is 
no wonder that job creation and America's global 
competitiveness are handicapped. We believe, as President Obama 
recently stated in his State of the Union address, that we have 
to make America the best place on earth to do business, and we 
at U.S. Steel are eager to help you achieve this worthy and 
rewarding goal.
    [The prepared statement of Mr. Harnack follows:]

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    Mr. Whitfield. Thank you very much.
    Mr. Goldstene, you are recognized for 5 minutes.

                STATEMENT OF JAMES N. GOLDSTENE

    Mr. Goldstene. Thank you. Good afternoon, Chairman 
Whitfield, Ranking Member Rush, members of the committee. I 
appreciate the invitation to speak today on the proposed Energy 
Tax Prevention Act of 2011.
    My name is James Goldstene. I am the Executive Officer of 
the California Air Resources Board, the primary body charged 
with protecting the air quality and air-related public health 
in California, and charged with speaking for the State on air 
quality and climate change issues. I am also a member of the 
Board of Directors of the National Association of Clean Air 
Agencies, or NACA, an associate of State and local clean air 
agencies across the country.
    Today I would like to share with my perspective as a State 
agency administrator and as an air quality regulator.
    The issue before us today concerns the preemption of the 
Clean Air Act, one of the most successful environmental laws in 
the history of the United States. For 40 years, the sensible 
pollution limits established under the Clean Air Act have 
dramatically improved air quality and public health, saving 
hundreds of thousands of lives and generating over $2 trillion 
in economic benefits for the American people. Let me start with 
vehicles. Passenger vehicles are not only responsible for 20 
percent of carbon pollution but the majority of our oil 
dependence. Preempting the authority for EPA to regulate the 
greenhouse gas emissions of vehicles would rob this country of 
one of its most powerful tools, not just to reduce carbon 
pollution but also to reduce our dependence on foreign oil, and 
to save consumers money.
    Simply maintaining the U.S. Department of Transportation's 
authority to regulate fuel efficiency is not adequate. While 
the fuel economy standards can complement long-term mobile 
source greenhouse gas reduction strategies, they are in no way 
a substitute for them. The combined fuel economy and vehicle 
greenhouse gas emission standards promulgated by EPA and DOT 
last year represent an important and unprecedented partnership. 
This approach leverages the strengths of both agencies and 
combines the related but different aspects of fuel economy and 
greenhouse gas emission standards. As a result, the combined 
standards achieve 35 percent less pollution and 25 percent less 
fuel consumption, compared to relying on CAFE standards alone.
    California embraced these joint standards and the national 
program wholeheartedly, accepting the federal program as 
equivalent to our own program for model years 2009 to 2016. We 
have continued to carry on this unprecedented spirit of 
cooperation and collaboration following the historic May 2009 
Rose Garden agreements, working with both federal agencies and 
automobile manufacturers to develop the next round of 
standards. California remains committed to the process of 
working closely with our partners to do everything we can to 
repeat that success for the 2017 to 2025 standards.
    We are building on a firmly established precedent and 
foundation of national environmental policy. Since the early 
1960s, California has established pollution standards for new 
vehicles sold in the State predating even the Federal 
Government's effort in this arena, and the pattern has 
continued. Since the 1980s, each successive California standard 
has gone on to become the national standard. In that time cars 
have become 99.7 percent cleaner, all while the auto industry 
has innovated to continue providing consumers with the amazing 
diversity and quality of affordable vehicles that we enjoy 
today. And of course, in this we are joined by our other 
States, the so-called section 177 States who have acted like 
California to address their own quality and public health 
concerns with our cost-effective standards. Preempting 
California's ability to set carbon pollution standards for 
vehicles would also increase costs to California consumers. 
These vehicle standards are one of the most cost-effective 
measures in California's clean energy plan, saving consumers an 
average of $2,000 over the life of a vehicle.
    With regard to pollution from electricity generators and 
factories, EPA is utilizing the tried-and-true framework for 
reducing pollution. Far from overreaching, EPA is responding to 
the clear mandate of the Clean Air Act, the dictates of the 
Supreme Court and fulfilling the clear intent of Congress that 
newly identified public health risks from air pollutants not 
listed in the Act be addressed. The obligation is clear and 
unambiguous.
    Contrary to claims of a rush to regulation, EPA has been 
proceeding methodically. Clearly, EPA has moved forward in the 
past 2 years with a tailored, measured approach. This 
permitting process is business as usual for State and local air 
quality agencies across the country who are using a well-known 
process that has been used for decades. EPA has provided 
flexibility for State and local agencies in how to run the 
permitting program so that the local regulators can work with 
the permit applicants. The claim that permitting would grind to 
a halt is simply false. All we want is to provide certainty for 
industry to invest and create jobs.
    This legislation, however, would forestall needed and 
available investment in the energy sector now and threaten the 
competitiveness of the American economy in the long run. We 
know that when government provides clear signals and a 
predictable regulatory environment, industry is quick to adapt, 
seize investment opportunity and create good jobs along with 
profits. For example, in the face of the current recession, 
clean technology has been the fastest-growing sector in 
California. Thank you, sir.
    [The prepared statement Mr. Goldstene follows:]

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    Mr. Whitfield. Thank you, Mr. Goldstene.
    Dr. Goldman, you are recognized for 5 minutes.

                  STATEMENT OF LYNN R. GOLDMAN

    Dr. Goldman. Mr. Chairman, thank you so much for the 
opportunity to testify about this Act. My name is Lynn Goldman. 
I am Dean of the George Washington University School of Public 
Health and Health Services, a pediatrician and a professor of 
environmental and occupational health. Today I represent the 
American Public Health Association, or APHA. APHA is the 
Nation's oldest and most diverse organization of public health 
professionals in the world dedicated to protecting all 
Americans and their communities from preventable serious health 
threats and assuring community-based health promotion and 
disease prevention activities that are universally accessible 
across the United States. With your consent, I will place my 
written statement in the record.
    For 40 years, the Clean Air Act has safeguarded the health 
of all Americans including the most vulnerable. By EPA's 
estimate, the first 20 years of the Clean Air Act has prevented 
more than 200,000 premature deaths, 672,000 cases of chronic 
bronchitis, 843,000 asthma attacks and 189,000 cardiovascular 
hospitalizations, making it one of the most successful public 
health laws of our time.
    As you know, in 2007 the U.S. Supreme Court directed EPA to 
assess the science in order to decide whether or not to move 
forward with efforts to protect the public's health from the 
impacts of greenhouse gases. They did so, and they developed an 
endangerment assessment. It is because of this endangerment 
assessment and our knowledge about the public health effects of 
climate change that APHA opposes this legislation, and we are 
not alone in this position. In a December 6, 2010, letter to 
all Members of Congress, APHA was joined by the American Lung 
Association, the American Academy of Pediatrics, the American 
College of Preventive Medicine and other leading national and 
State public health, medical and clean air advocates in urging 
Congress to support moving forward with protective clean air 
standards and to oppose any measure that would delay or block 
progress toward a healthier tomorrow for all Americans.
    Climate change is a public health issue, and over time it 
is one of the greatest threats to human health. Scientists from 
across the globe have stated in the strongest possible terms 
that the climate is changing and that human activity is to 
blame. Scientists have unequivocally concluded that greenhouse 
gas is causing global warming and the United States is the 
leading contributor to these gases. The average increase in 
earth's temperature is causing extreme weather events and 
increases and decrease in temperature and rainfall. These 
regional weather changes may create environmental conditions 
like floods, heat waves, droughts and poor air quality that are 
not healthy. Some of the health effects we may be concerned 
about are strokes, injury, malnutrition, respiratory disease 
and asthma, and infections such as vector- and rodent-borne 
diseases. Huge costs and human suffering are associated with 
these outcomes. We are already beginning to see the health 
impacts worldwide. Impacts will only worsen if we continue to 
ignore this problem.
    I can recite more statistics, but let us take childhood 
asthma as an example. Already in the United States, asthma is 
the largest cause of hospitalizations and lost days of school 
for children but as a pediatrician, I also know the impacts of 
this disease on an individual child: a child who grows up 
unable to breathe without medication, unable to play outdoors 
like other children. Climate change is creating conditions that 
not only cause more asthma attacks but also can cause rates of 
asthma to rise in children. Moreover, the same activities that 
emit carbon dioxide also emit a wide variety of other 
pollutants that are harmful to health, pollutants like nitrogen 
oxides, air toxics and fine particulate matter. These 
pollutants also contribute to various diseases. Along with 
global warming, they contribute to formation of ground-level 
ozone. That is also unhealthy.
    So we do need regulations that control greenhouse gas 
emissions but these need to be written and implemented 
intelligently in a manner that also reduces exposure to other 
pollutants that might come from coal-fired power plants, that 
might come from automobiles. Control of pollution from power 
plants also increases the healthfulness of air in communities 
that are near those plants. These facilities are often closer 
to low-income communities that suffer disproportionately from 
air pollution.
    Measures to control air pollutants under the Clean Air Act 
need to work together as a whole to protect health. Cherry 
picking among these ignores the fact that health effects are 
associated with multiple classes and sources of pollution and 
is not consistent with science. Another way we can improve is 
by increasing energy efficiency. When we reduce our use of 
energy, we reduce emissions of the pollutants associated with 
energy and other harmful substances.
    In closing, I should say that this bill would do nothing to 
reduce uncertainty. There is a problem, a clear and present 
public health threat from climate change. There are no answers 
to this problem in this legislation. Until Congress is putting 
forward solutions, there will be a to of uncertainty in this 
country about where we are heading with this problem. Thank you 
very much.
    [The prepared statement of Dr. Goldman follows:]

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    Mr. Whitfield. Thank you very much for your testimony. We 
appreciate once again your taking the time to be with us today.
    I would say, Dr. Goldman, that all the testimony I heard 
today made it very emphatically clear that there would be great 
uncertainty by EPA continuing to try to regulate greenhouse 
gases, and I would also say that on the light-duty motor 
vehicle standards which EPA has promulgated, this legislation 
would not change and affects model years 2012 through 2016. 
Now, the testimony has shown that that regulation is going to 
cost $52 billion to consumers in America and it is going to 
lower the temperature 90 years from now by maybe one one-
hundredths of a degree. So what we are trying to do here is 
balance. We want to protect health, we want to protect 
environment, we want to protect jobs. We want to provide 
incentives for investment and we want to be competitive in the 
global marketplace.
    And Mr. Nelson, when Administrator Jackson was sitting 
right there, she said that the greenhouse gas regulations would 
really not impact the farming community, but from your 
testimony, I think you made it pretty clear that you would not 
agree with her statement. Is that correct?
    Mr. Nelson. That is correct. She made a couple comments 
that at this point in time it didn't impact it but our 
understanding, there are over 100 farm entities that do report 
to EPA at the present time, and----
    Mr. Whitfield. Well, as you said, it will certainly affect 
our electricity costs. There is no question about that. It will 
affect your fertilizer costs. There is no question about that.
    Now, the tailoring rule certainly would exempt many of you, 
but Mr. Glaser, that tailoring rule, Mr. Glaser, the tailoring 
rule is an explicit violation of the specific language of the 
Clean Air Act, isn't it?
    Mr. Glaser. I don't see how you could be any more clear in 
the statute than by using a number.
    Mr. Whitfield. Yes, and the number says 100 or 250 tons per 
year.
    Mr. Glaser. One hundred or 250. It doesn't say 100,000.
    Mr. Whitfield. And she says 100,000. Now, have lawsuits 
been filed against the tailoring rule?
    Mr. Glaser. Yes, they have.
    Mr. Whitfield. And have lawsuits been filed against EPA's 
allegation that the fact that they were required by the Supreme 
Court to look at this issue on mobile sources because they 
found an endangerment finding there that they are automatically 
required to regulate stationary sources. Has there been a 
lawsuit filed on that?
    Mr. Nelson. Yes. I mean, I have to say that what has gone 
on is again, as one of the witnesses said, when you try to jam 
a square peg into a round hole, you end up with a great deal of 
legal uncertainty and you end up with a great number of 
lawsuits including EPA's contention that by finding that 
automobile emissions endanger public health and welfare and 
therefore regulating automobiles, you then automatically have 
to regulate stationary sources. That is also uncertain and 
doesn't seem to be a logical reading.
    Mr. Whitfield. And I might say, we are certainly not trying 
to gut the Clean Air Act in any way. We are trying to break the 
logjam which was written by a former legal counsel for the 
National Resources Defense Council, and he says in this book 
that the Clean Air Act was never meant to regulate greenhouse 
gases and it does not work in doing so.
    Now, Ms. Jackson also admitted today that there is no 
technology available to deal with greenhouse gases and that her 
rules would not in any way meaningfully reduce greenhouse 
gases. But she did say we are going to require efficiencies to 
be adopted by stationary sources, and then some people have 
said well, there is nothing wrong with that, that is 
reasonable, and that is reasonable. I am assuming, Mr. Harnack, 
that most businesses want to be as efficient as they can be and 
they don't need government bureaucrats telling them to do that. 
Is that correct or not?
    Mr. Harnack. I mean, in our case, that is correct. We have 
done a lot of energy efficiency projects. We have a corporate 
energy efficiency initiative that has been in place for many 
years now, and we think that we have captured a lot of the low-
hanging fruit. Some of the challenges now is that some of the 
projects that we have just do not have suitable return for us 
to invest very limited capital in based on our situation and 
the business climate right now.
    Mr. Whitfield. But they seem to be working on the premise 
that in order to be efficient, the government regulators have 
to tell you to be efficient and how to do it, and if the State 
regulators make a ruling that you should do it this way to meet 
these standards, EPA is not precluded from coming back later 
and disagreeing with that and making you even change that. Is 
that right, Mr. Glaser?
    Mr. Glaser. Yes, I completely agree with that. Yes, sir.
    Mr. Whitfield. Well, my time has already expired, so Mr. 
Rush, I recognize you for 5 minutes.
    Mr. Rush. Mr. Nelson, as a fellow Illinoisan and as a 
supporter of Illinois farms, I certainly want to welcome you 
here to this subcommittee, and I understand your concerns about 
potential impacts on small agricultural operators if EPA had 
not adopted the tailoring rule. Requiring permits for these 
sources makes no sense. That is why I was pleased to hear 
Administrator Jackson assure us earlier today that the 
tailoring rule avoids any energy and greenhouse gas 
requirements on small sources including farms. Did you hear her 
say that?
    Mr. Nelson. She did allude to that, but I think the one 
thing to keep in mind when she was talking about agriculture, 
we are big consumers of energy and we rely on energy so if 
indeed you were to put undue regulations on some of the inputs 
that we utilize in agriculture, it has a tremendous impact on 
production agriculture.
    Mr. Rush. Well, and being consistent with her testimony, 
does any farm have to report under the greenhouse gases 
reporting rule?
    Mr. Nelson. Well, it would depend on a number of things. If 
you were not reclassified, and we looked at stationary sources, 
livestock would fall under that category as it stands right 
now. We have asked that of the EPA of whether they are going to 
reclassify stationary sources as it relates to agriculture. 
They have not done it as of now. Being a livestock producer, it 
creates a huge burden when you look at the dollars that we are 
talking of assessing livestock operations just to stay in 
business.
    Mr. Rush. But as of today, there is no farm that you are 
aware that has to report under the greenhouse gas reporting 
rule as of today, as it stands right now?
    Mr. Nelson. As it stands right now, some of those that fall 
into a certain category, there are approximately 100 based on 
what we know that do report to the EPA.
    Mr. Rush. The regs went into effect on January 2nd of this 
year. You said there are at least 100 farms who are now subject 
to these rules. Is that what you are saying?
    Mr. Nelson. Yes, and if you require a manure management 
system, they do report as of now.
    Mr. Rush. I want to switch my questioning to Dr. Goldman. 
Dr. Goldman, do you believe that it is appropriate for Congress 
to pass legislation that substitutes Congress's views that 
carbon pollution does not endanger public health for your and 
other scientists' interpretation that carbon pollution does 
endanger public health?
    Dr. Goldman. No, I don't believe that would be appropriate.
    Mr. Rush. Can you be more concise and tell the subcommittee 
why you support the Clean Air Act and the steps that the EPA is 
taking to put limits on carbon pollution?
    Dr. Goldman. I support it because at this point in time it 
is the only method that the EPA has for being able to deal with 
this very clear and present threat, and that is the Clean Air 
Act and the emissions that cause global warming are air 
emissions and they can be regulated under the Clean Air Act, 
and EPA has been able to make clear public health findings that 
indeed they are threatening the Nation's health.
    Mr. Rush. Thank you. Mr. Chairman, I yield back.
    Mr. Whitfield. Yes, sir. Mr. Shimkus, you are recognized 
for 5 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman, and I am just going 
to go quick, but in response to Dr. Goldman's response to the 
question, the elected representatives have never passed any 
piece of legislation that has been signed into law to regulate 
greenhouse gas. I am not asking for a response, I am just 
telling you, the elected representatives, the people who send 
us here from our districts, we have never, we have never passed 
legislation that has gone into law to regulate greenhouse gas 
emissions.
    If you would put up the picture on the slide there, this is 
for my colleague from Illinois, my friend, Mr. Nelson. This is 
kind of going off script on greenhouse gases. But Phil, tell me 
what is going on there.
    Mr. Nelson. That is a harvest operation, I believe 
combining soybeans.
    Mr. Shimkus. And that smoke in the back, what is that? Is 
that dirty petroleum product?
    Mr. Nelson. No, that is dust.
    Mr. Shimkus. Dust made up of?
    Mr. Nelson. Basically material coming off the plant after 
it is----
    Mr. Shimkus. Dried leaves, stems. They keep the beans and 
spread out the chaff, what we would call it.
    Mr. Nelson. That is correct.
    Mr. Shimkus. Is there not a fear from the agricultural 
community that the EPA is moving to regulate that activity?
    Mr. Nelson. Yes, there is, and as a matter of fact, I made 
the comments many times if you look even at the Kyoto Protocol, 
we would have to equip our harvest machines with dust 
collectors if you were going to take it to the nth degree.
    Mr. Shimkus. Which would be additional capital expense or 
maybe a water trailer and water it down to collect chaff, 
chaff. This is dust from leaves and stems in agriculture. That 
is pretty close to my home, and I took that as I was driving 
back from taking my kids. He was in the field. I pulled off on 
the side, took about five photos. I took that around in 
October, the election year, to the Farm Bureau meetings and 
held it up on my phone and said this is what--this is what we 
have in an EPA gone awry when they are going to spend time, 
effort, energy regulating chaff, and of course, in my 
congressional district, the people are just unbelievably 
astounded that we would do such a thing. So thank you for that.
    Let me just ask, does uncertainty raise the cost of 
capital? This is just a traditional, just a business question. 
Dr. Goldman, does uncertainty raise--you may not know. Does 
uncertainty raise the cost of borrowing money?
    Dr. Goldman. Not in my area.
    Mr. Shimkus. The answer is, it definitely does. It raises 
the interest, the rate on raising capital. So the reason why I 
ask this question is because certainty is what everybody is 
talking about. Mr. Goldstene says this produces more certainty. 
This greenhouse gas regulation is good for business. We have 
more certainty. That is correct, right? That is your testimony?
    Mr. Harnack, do you want to respond? Do you have more 
certainty today in U.S. steel production or less?
    Mr. Harnack. Definitely less, and the one thing----
    Mr. Shimkus. So the cost of capital increases for 
expansion?
    Mr. Harnack. The cost of capital is something that we know 
that there is not an alternative to the integral steel process 
presently, and the fact that we require carbon to create new 
steel, and the integrated process is slightly different than 
the electric furnace process because the electric furnace 
process----
    Mr. Shimkus. Go quickly.
    Mr. Harnack [continuing]. Requires recycled scrap. We mine 
ore that is required to make new steel, and there is not enough 
recycled scrap in the world to provide steel for all the 
applications.
    Mr. Shimkus. So this creates more uncertainty for your 
business?
    Mr. Harnack. Yes.
    Mr. Shimkus. And is there more uncertainty for the Chinese 
steel mill or less?
    Mr. Harnack. It doesn't apply to them.
    Mr. Shimkus. So there is less uncertainty, lower cost of 
capital for Chinese steel which would make Chinese steel more 
competitive in this country, another aspect.
    Mr. Nelson, in the agriculture community, more uncertainty 
or less?
    Mr. Nelson. Absolutely more, and you look at our 
competitors in South America and Europe that we compete 
against, and you just--the fear of the unknown about how many 
more undue regulations are going to make us more uncompetitive 
in the environment that we are a part of.
    Mr. Shimkus. Let me go to our economist. More uncertainty, 
less, Dr. Thorning, this premise on how we create jobs, how do 
we raise capital?
    Ms. Thorning. Well, I think definitely more uncertainty, 
and the BACT rules released in November really don't help, so I 
think it is pretty clear that this regulation will have a 
negative impact on jobs and economic growth.
    Mr. Shimkus. Thank you very much.
    Mr. Whitfield. Thank you, Mr. Shimkus.
    I recognize the gentleman from Michigan, Mr. Dingell, for 5 
minutes.
    Mr. Dingell. Mr. Chairman, I thank you for your courtesy.
    This question is to Mr. Goldstene. Does CARB plan on 
finalizing California GHG emissions standards before the 
federal standards are finalized? Yes or no.
    Mr. Goldstene. Yes.
    Mr. Dingell. Thank you. Now, would you tell me and explain 
for the record how you and your staff have already stated fuel 
economy goals of 50 to 62 miles per gallon before the 
information and analysis that is available to complete that 
process has been made available to the commission?
    Mr. Goldstene. Congressman, we have made a public 
commitment just recently that we are going to wait to propose 
our rule until the beginning of September, which is the same 
time that DOT and EPA will propose their rules. We have not 
made any public announcements that we have chosen or predecided 
what the standard should be. We have been discussing a range of 
standards in public workshops, and I think that is maybe where 
you are hearing that.
    Mr. Dingell. So what you are telling me is, you have stated 
the fuel economy goals are going to be 50 to 62 miles per 
gallon before you have gotten the information and the analysis 
necessary to complete the process. Is that right?
    Mr. Goldstene. No, sir, that is not what I am saying. I am 
saying that----
    Mr. Dingell. Well, what are you telling me then, please?
    Mr. Goldstene. What I am saying that is that we are working 
with DOT and EPA on a series of studies. We are waiting to 
complete those studies, which are going through peer review, 
and we will use all the information----
    Mr. Dingell. I only have 34 seconds here.
    Mr. Goldstene. Sorry.
    Mr. Dingell. Have you gotten the information and the 
scientific work done to support those numbers? Yes or no.
    Mr. Goldstene. We have a lot of information that is being 
peer reviewed.
    Mr. Dingell. Do you have the information that would support 
that statement in proper form to stand a judicial review?
    Mr. Goldstene. We may. It depends on what the final peer-
reviewed studies say and what we----
    Mr. Dingell. Thank you very much.
    Mr. Goldstene [continuing]. Propose as a regulation with 
DOT and EPA.
    Mr. Dingell. We had a little trouble getting the answer but 
I do thank you for your kindness. Now, does CARB conduct 
analysis on job impact and economic consequences of the 
standards that it is considering?
    Mr. Goldstene. Yes.
    Mr. Dingell. Would you please submit that analysis on the 
fuel efficiency standards that you are suggesting for purposes 
of the record, please?
    Mr. Goldstene. We would be happy to. We haven't completed 
them for the new set of standards. We have them for the prior 
standards.
    Mr. Dingell. Now, would you tell us about the extent of 
CARB's safety expertise? What safety expertise do you have? Do 
you have any responsibility under the California statutes to 
deal with the question of safety or not?
    Mr. Goldstene. No, but that is why we are working with DOT.
    Mr. Dingell. Thank you.
    Mr. Goldstene. And we have jointly funded a study on this 
issue.
    Mr. Dingell. Thank you very much. Now, 2 days ago, CARB 
sent letters to the CEOs of all the automobile alliance asking 
them to distance themselves from the alliance's complaint in a 
letter to Chairman Darrell Issa that the CARB was moving 
unilaterally forward in regulatory process. CARB disputes that 
claim by saying, ``We recently issued a joint statement with 
EPA and NHTSA promising that we would release proposals for the 
next set of GHG standards and NHTSA's on the same date 
September 1, 2011.'' Now, yes or no, isn't it true that CARB 
made a joint statement on timing with EPA and NHTSA only after 
the alliance sent the aforementioned letter to Chairman Issa 
and only after CARB received a letter and only after the Obama 
Administration in response to the letter asked CARB to stop 
getting out in front of the federal process? Yes or no.
    Mr. Goldstene. There are a lot of questions there. We have 
been working with EPA, DOT and the White House on the next 
round of standards, and all along we have been making public 
statements and commitments that we would not get out ahead of 
our partners at EPA and NHTSA.
    Mr. Dingell. Let me read this again. Two days ago, CARB 
sent letters to CEO members of the auto alliance asking them to 
distance themselves from the alliance's complaint in a letter 
to Chairman Darrell Issa that the CARB was moving unilaterally 
forward in the regulatory process. Is that true or false?
    Mr. Goldstene. We sent a letter to the CEOs----
    Mr. Dingell. Good.
    Mr. Goldstene [continuing]. Saying--being critical of the 
alliance letter to Congressman Issa. Yes.
    Mr. Dingell. The answer to that is yes. Please, I have 
limited time. Now, CARB disputes that claim by saying, ``We 
recently issued a joint statement with EPA and NHTSA promising 
that we would release proposals for the next set of GHG 
standards and NHTSA's on the same date September 1, 2011.'' Is 
that true?
    Mr. Goldstene. That is true.
    Mr. Dingell. OK. Now----
    Mr. Goldstene. But that is not new. That was just putting 
in writing what we have been saying all along.
    Mr. Dingell. Please. May I continue?
    Mr. Goldstene. Yes, sir.
    Mr. Dingell. Isn't it true that CARB made the joint 
statement on timing with EPA and NHTSA only after the alliance 
sent the aforementioned letter to Chairman Issa and only after 
CARB received the letter and only after the Obama 
Administration in response to the letter asked CARB to stop 
getting in front of the federal process?
    Mr. Goldstene. It is true that we sent the letter after the 
alliance sent their letter.
    Mr. Dingell. Thank you. Now, would you tell us if it is 
your view that global warming problems should be dealt with 
under the Clean Air Act or is there a better way of dealing 
with it?
    Mr. Goldstene. The Clean Air Act is the tool we have, the 
tool that EPA has.
    Mr. Dingell. But is it going to be simple and easy to do? 
Is it going to be relatively free from litigation and questions 
or is it going to be a very complex grind where you will have a 
number of different options and might wind up with quite 
different standards for different things in different States?
    Mr. Goldstene. I think that the EPA is hoping to avoid that 
by using their power under the Clean Air Act.
    Mr. Dingell. I know, but are they going to be able to, in 
your opinion?
    Thank you, Mr. Chairman.
    Mr. Goldstene. I think there is a way to make sure that you 
make the rules as easy to understand nationally as possible, 
and we have proven that over and over again through the 
adoption of our clean car standards in California that get 
adopted then by other states and ultimately the Federal 
Government.
    Mr. Whitfield. I recognize the gentleman from Michigan for 
5 minutes.
    Mr. Dingell. You have been very kind, Mr. Chairman. Thank 
you.
    Mr. Upton. Thank you, Mr. Chairman. I will confess that 
several years ago I voted against cloning, and days like today, 
I wonder why as I have been in a number of different events and 
I was sad to miss the testimony by all of you during this 
panel, but I have a couple of questions.
    Dr. Thorning, you indicated--and I talked to the earlier 
panels, in Michigan these regulations have been predicted to 
reduce our GDP by $18 billion, destroy 96,000 jobs, reduce 
household incomes by nearly $1,600. In your testimony, I 
believe, or in response to a question, you talked about a model 
that showed by 2014 that $25 to $75 billion decrease in capital 
investment would in fact result in an economy-wide job loss of 
somewhere between 476,000 and 1.4 million when direct and 
indirect and induced effects are included, and as a result, GDP 
would be $47 billion to $141 billion less in 2014. Can you 
expound a little bit about how you came up with those numbers?
    Ms. Thorning. Yes. Looking at the regulated industries that 
are initially going to come under EPA's regulations, we 
concluded that those represented about--that the investment in 
those industries normally represents about 25 percent of all 
U.S. investment on an annual basis, and then we did some 
research on how the risk premium for investment in those 
industries might be impacted by the uncertainty surrounding EPA 
regulations, the tailoring rule, whether it will stand, so 
forth, and we concluded that the risk premium probably would 
increase between 30 and 40 percent for those industries. 
Therefore, if those industries represent approximately 25 
percent of all investment, we concluded that that would 
represent looking at historical data a decrease in investment 
of between $25 billion a year and $75 billion a year.
    Now, remember that overall gross private domestic 
investment is like $1.7 trillion, so we thought that was a 
pretty conservative estimate and we used a conservative 
estimate of the elasticity of response to investment to changes 
in the cost of capital, and we ran through that the IMPLAN 
model, which is a near-term model good for short-term 
predictions, not good for long-term predictions, it produced 
results with the direct, the induced and the ancillary impacts 
of nationwide job reduction compared to the baseline forecast 
of between 476,000 fewer jobs to as many as 1.4 million fewer 
jobs in the year 2014, and of course, some industries are more 
impacted than others, and GDP of approximately $47 billion 
smaller to $141 billion smaller, and this is just targeting 
these industries right now that are impacted and the large ones 
that are included in EPA's current regulatory regime.
    Mr. Upton. Thank you.
    Mr. Goldstene, in announcing his new Executive Order on 
regulations, President Obama cited one national program as a 
good example of eliminating a tangle of regulations. The tangle 
was the result of three different agencies--NHTSA, EPA and 
CARB--trying to regulate basically the same thing. One national 
program eliminated the tangle for 2012 through 2016 by getting 
EPA and NHTSA to coordinate with each other and by California 
agreeing to defer to the federal regulations. It now appears 
that for 2017 and beyond, we are in the process of re-creating 
the tangle that the one national program eliminated since 
California is planning to promulgate a new set of GHG regs. Why 
shouldn't it be that California agree that from now on there 
will be a national program consisting of NHTSA and EPA 
regulations only? Why does California need to duplicate or move 
forward with a different plan?
    Mr. Goldstene. Mr. Upton, as you know, California has a 
special mention in the Clean Air Act because our air quality 
problems have been so severe over the years and they are still 
severe in certain areas of the State like in Los Angeles and 
the central valley. So from the perspective of a State that 
still has significant air quality problems, we have to fight to 
keep our authority to promulgate the rules that are needed to 
protect the public health, and these vehicle standards are one 
of the ways that we do that. We are sometimes or often joined 
by other States under section 177 that can use our rules if 
they choose to and that sometimes creates what the auto 
industry had called a patchwork quilt, but the fact is, at most 
you would only have two standards, and over the past 40 years 
what we have seen over and over again is that if the two 
standards become one relatively quickly, and that is what just 
happened with the 2012-2016 standards, and this time unlike 
before, we are working very closely with EPA and DOT, using the 
same information, relying on the same peer-reviewed studies, 
and working hand in hand on developing and designing our rules. 
They may come out slightly differently. Our process is slightly 
shorter, so we may complete our process before EPA and NHTSA 
finish their processes but we are fully committed to 
harmonizing them as soon as they are done.
    Mr. Whitfield. Ms. Capps, you are recognized for 5 minutes.
    Ms. Capps. Thank you, Mr. Chairman, and I want to start 
out, I have questions for you, Mr. Goldstene, and also one for 
Dr. Goldman, and as someone who represents a district in 
California where we can look out to see whether the brown haze 
is coming up from the L.A. basin on certain days and have lived 
there long enough to notice the rise as a former school nurse 
of school-age asthma and being aware that there were certain 
days in the L.A. basin when frail adults were told to stay 
inside and kids couldn't go out on the playground. That is one 
of the special things about living in our State and why I am so 
appreciative of the work that you as Executive Officer of the 
California Air Resources Board, or CARB, and I want to tell 
you, I appreciate the regulation of the marine vessels, which 
have added a great deal to their air quality in my part of the 
State and all along the coastal areas.
    You have some--we have been hearing today about the fact 
that addressing climate change will destroy the economy. You 
have some practical experience because California is well 
underway in implementation of a State law to conduct carbon 
pollution. Can we cut carbon pollution, Mr. Goldstene, without 
harming the economy? In a few words.
    Mr. Goldstene. Yes, we can. We have also run economic 
analysis like the kind that Dr. Thorning described using 
macroeconomic models, and we have used a model called EDRAM and 
BEAR. I am sure Dr. Thorning knows those models. And what we 
have shown overall in the California economy is there is a very 
slight net positive with climate regulations under our plan 
economically.
    Ms. Capps. Thank you. And a very brief assessment of how 
workable EPA's approach is.
    Mr. Goldstene. I think it is very workable. I have been 
here all day, and I have seen the complaints, but the fact is, 
I think most of the claims and worry while the worry is real, I 
think when you look at the specific details, for instance, the 
cost of capital, the cost of capital is influenced by many, 
many factors, not just by the possibility of a regulation.
    Ms. Capps. And you are also a member of the board of 
directors for the National Association of Clean Air Agencies.
    Mr. Goldstene. Yes.
    Ms. Capps. Just a couple words on your understanding of 
whether other States are finding EPA's approach to be workable 
as you talk with people from other States.
    Mr. Goldstene. Yes. There are many States that are 
embracing EPA's process and effort. Of course, there are States 
that are also concerned about it but I think on the whole----
    Ms. Capps. Overall, are we moving in the right direction?
    Mr. Goldstene. Overall, it is moving in the right 
direction, but I do think people in other States, my colleagues 
and the governors in many other States see the potential for 
the great economic innovation that can come from this and job 
creation that can come from this kind of rulemaking.
    Ms. Capps. Thank you, Mr. Goldstene.
    Dr. Goldman, I recently heard a story about back when the 
Clean Air Act was first being debated on the House floor. One 
Congressman quoted a mayor, and this is the quote: ``If you 
want to make this town grow, it has got to stink.'' I think 
that has been proven wrong. Our economy has not shriveled over 
these past years of trying to improve the air quality. Instead, 
the GDP has grown 207 percent. My question to you representing, 
as you do, the American Public Health Association, can you 
please share with us the health benefits and really the 
economic benefits as a result of responsible limits to 
greenhouse gases, the approach the EPA is taking?
    Dr. Goldman. The benefits are potentially quite enormous, 
and what we are looking at in terms of threats from climate 
change have to do with health impacts from adverse weather 
events like flooding and drought, adverse health impacts from 
dirty air, and also adverse health impacts form changing the 
distribution of disease-bearing vectors like insects and 
rodents, and these are all enormous threats. I think the most 
immediate ones that we are seeing have to do with the 
increasing frequently of severe weather events which have a 
major impact on people's health.
    Ms. Capps. And with that, I am going to yield back the 
balance of my time.
    Mr. Whitfield. Thank you, Ms. Capps.
    Mr. Scalise, you are recognized for 5 minutes.
    Mr. Scalise. Thank you, Mr. Chairman. First a question for 
Mr. Nelson with Farm Bureau. I appreciate you being here to 
discuss the importance of the impact of greenhouse gas 
regulations and how they would impact specifically the 
agriculture industry. I know you know the essential role that 
the agriculture industry plays in America's way of life but 
also especially as it relates to our economy and the small 
businesses that are such the heart of the agriculture industry. 
I represent a part of southeast Louisiana. We have a larger 
presence of dairy farmers, in my district, and really concerned 
about the impact that EPA regulations would have on these small 
businesses, you know, especially as Administrator Jackson has 
talked about potentially down the road doing some things there. 
The dairy industry in Louisiana contributes about $115 million 
to Louisiana's economy, and those proposed EPA regulations 
would devastate many of these small businesses who literally 
are operating on the margins. I think you were here when the 
Administrator was giving her statements, but since the EPA 
Administrator has left the door open to regulation of the 
agriculture industry, can you speak specifically to how it 
would potentially affect especially those small dairy farms in 
districts like mine and yours in Illinois and throughout the 
country?
    Mr. Nelson. Well, really I would address it two different 
ways. You have to look at the livestock industry and what is 
being proposed or thrown out there in regards to a Title V 
permit if isn't reclassified. It will have a tremendous impact 
on the dairy industry. I think the numbers that we are looking 
at, you know, are $175 for a dairy cow, which you just cannot 
make any money----
    Mr. Scalise. But it would cost an additional $175 per dairy 
cow if those EPA restrictions were put in place?
    Mr. Nelson. That is correct.
    Mr. Scalise. Gee, whiz.
    Mr. Nelson. And not only that, then you look at the 
production side of things as Congressman Shimkus alluded to, 
the threats are out there as far as dust permits. We have got a 
couple States right now that can't even deal with the dust 
standards as it is proposed today, let alone try to make those 
twice as stringent as what we are hearing coming out of the 
Administration. So it really impacts a number of facets of 
agriculture if these regulations proceed forward and are put in 
place.
    Mr. Scalise. And that seems to actually go in sync with 
some of the statements that were made on the previous panel. 
Mr. Alford, who is the President and CEO of the National Black 
Chamber of Commerce, had given some testimony and he talked 
about a number of impacts, and they had done a study, and one 
thing he looked at, on the poorest 20 percent of our 
population, he said this kind of scheme by EPA would increase 
the cost of home energy by 45 percent, motor fuel by 25 
percent, and he said it would also increase groceries by 35 
percent on our Nation's poorest families. So can you talk 
about, especially from the agriculture industry, what would the 
impact of a 35 percent increase in food prices on our poorest 
families in this country have?
    Mr. Nelson. Right now, consumers have probably the best 
bargain in the entire world where we spend about 10 cents out 
of every disposable dollar for food. You look at Japan and some 
of the other developed countries that do have regulatory 
frameworks that could parallel some of the things that are 
being proposed by this Administration, so you could easily make 
the case of doubling what we pay for food.
    Under Waxman-Markey, we had a lot of sensitivity with that 
bill as it related to what it would do to food prices, what it 
would do to energy prices if you didn't sight the nuclear power 
plants, if you took almost 59 million acres out of production, 
row crop agriculture, what that would do to the consumer and 
the grocery store. So, you know, it is going to have a dramatic 
impact if indeed we don't use some common sense to try to look 
at a regulatory framework that is workable without really 
impacting our industry to the degree that----
    Mr. Scalise. Thank you. And I know we are trying to get EPA 
to look at the job loss impact of all of the things that they 
are doing in these regulations but I would be curious to see if 
EPA is going to do an impact on the lives that would be lost if 
you had a 35 percent increase in the food that our poorest 
families by where you literally would be taking food of the 
table of American families because of these regulations on the 
agriculture industry.
    Ms. Thorning, I know I am running low on time but Ms. 
Thorning, I am not sure if you had seen the study that we have 
seen on the Spain experiment with this kind of, you know, this 
cap-and-trade scheme where they regulate and they talked about 
all the green jobs that I would create, and of course it turned 
out in Spain after they looked at it, all of the promises of 
those new jobs turned out to be a mirage and they ended up 
losing two jobs for every job they created and in fact for each 
new job they created, only 10 percent were actually permanent 
jobs, so in essence, you lost 20 full-time jobs for every real 
job that you created in this industry. Have you looked at any 
of those studies?
    Ms. Thorning. Yes, I have seen that study. There is also 
one done by a German think tank that looks at the cost of solar 
energy and electricity prices in Germany. There is one in 
Denmark that shows the same thing. The issue is, when you 
substitute more expensive energy for cheaper energy, you might 
gain some jobs in that sector, you know, the green energy 
sector but you are going to lose them overall because you are 
making other products, other producers pay a lot more for 
energy, and that finding is mirrored in the work that groups 
like ours have done with the Department of Energy's own NIMS 
model analyzing Waxman-Markey, Kerry-Lieberman. We always get 
some more green jobs because, you know, we are forcing quicker 
uptake of energy efficiency but overall the macro models show 
job loss, and that is a similar conclusion that you have got--
--
    Mr. Scalise. Thank you, and I yield back, Mr. Chairman.
    Mr. Whitfield. Mr. Doyle, you are recognized for 5 minutes.
    Mr. Doyle. Thank you, Mr. Chairman. First, let me commend 
you and the ranking member for your stamina and the panel for 
your patience, and welcome to all of you. I want to especially 
welcome Fred Harnack from U.S. Steel. Just by way of full 
disclosure, Fred and I go back quite a bit. He started out at 
Edgar Thompson, where my father worked for 30 years. Then over 
to the Homestead Works plant, an urban plant in West Mifflin 
and Mon Valley Works, and Fred probably has an incredible 
knowledge of my congressional district and the steel industry, 
which are two things that I hold near and dear to my heart, and 
I suspect that we were both crying in our Iron City beers a 
little bit on Sunday after that game was over, but Fred, it is 
good to have you here.
    You know, I follow the steel industry's performance 
closely, and I am certainly aware of the current difficulties 
that integrated steel mills face. We know the cost of raw 
materials has gone up greatly and that continues to affect the 
performance of manufacturers, and also it is an industry that 
is uniquely affect by it has international trade pressures too. 
This is why as we were trying to develop a comprehensive energy 
bill, that we were particularly sensitive about those things 
and tried to put language in the bill that would address some 
of the pressures that industries like steel had that were 
carbon intensive but had trade pressures too.
    On the earlier panel, I talked to Administrator Jackson and 
I asked her how this new greenhouse gas permitting process 
would affect facilities like steel mills, and Fred, I wonder if 
you can tell me right now what capacity U.S. Steel is currently 
operating at?
    Mr. Harnack. Presently we are probably somewhere between 75 
and 80 percent. We do have one plant idled and a number of 
other facilities are not as full as we would like them to be.
    Mr. Doyle. So, you know, all of us are hoping that the 
industry reaches a point where you are able to ramp up to 100 
percent of our operating capacity but assuming you were able to 
ramp up to 100 percent of your operating capacity, would U.S. 
Steel be required to apply for a greenhouse gas permit to cover 
the increased activity?
    Mr. Harnack. Presently, we are doing the greenhouse gas 
report that is required. We only need to file for the permits 
that are above the threshold, and right now that exists only in 
our expansion plans in our Minnesota ore operations. The 
balance of the facilities are permitted for the capacity that 
we publish, and there would not be any additional needs to 
permit for that at this time.
    Mr. Doyle. Right. So in other words, any existing facility 
right up to your full capacity, you wouldn't be affected by 
this, only if you had an addition, if you put up a new plant or 
if you expanded a current facility and got over that limit that 
would require a permit?
    Mr. Harnack. That is right, based on the present regulatory 
requirements.
    Mr. Doyle. So your plants that are currently operating in 
the United States, are any of them going to have to apply for 
renewals under their Title V permits for non-greenhouse gas air 
pollutants under the Clean Air Act?
    Mr. Harnack. There is--yes, we do have periodic permit 
renewals. Actually we are working on two in Allegheny County 
right now as well as have just recently obtained them in our 
Alabama operation.
    Mr. Doyle. Now, when you apply for these renewals, will 
your new permit have to include any pollution controls for 
greenhouse gases?
    Mr. Harnack. We will be required to provide all the 
regulatory information and regulatory requirements as it 
develops, you know, by the EPA and the government.
    Mr. Doyle. So you have to report your emissions but you are 
not required to implement any new control technologies as long 
as you are not expanding your current capacity?
    Mr. Harnack. Only on the newly permitted facilities that 
are above the threshold.
    Mr. Doyle. So as we speak today, even though you are going 
through Title V permit renewals, this would not require you in 
your existing facilities other than to report to EPA wouldn't 
require you to implement any new control technologies?
    Mr. Harnack. That is right.
    Mr. Doyle. So it seems to me as we look at these rules and, 
you know, today we are focusing--I mean, this rule focuses 
primarily under the tailoring provision coal-fired and fossil-
fired utility plants and oil refineries. Right now this has no 
direct impact on the steel industry unless you would put up a 
new plant or expand an existing plan. Is that correct?
    Mr. Harnack. Based on the present language on the 
greenhouse gas requirements but there are other requirements 
coming out from EPA that are going to require substantial 
modifications.
    Mr. Doyle. Right, but we are focused today and this bill 
focuses on the GHG emissions, not other things. That is what 
this focus is.
    Mr. Harnack. Right.
    Mr. Doyle. OK. Thank you very much, Mr. Chairman. I see I 
have 8 seconds, and I will yield it back.
    Thanks, Fred.
    Mr. Whitfield. Thank you. Mr. Gardner, you are recognized 
for 5 minutes.
    Mr. Gardner. Thank you, Mr. Chairman, and again, thank you 
to the witnesses for being here today.
    And Mr. Nelson, I would like to direct this question to 
you. In my conversation with Administrator Jackson on 
agriculture and agriculture's exemption so what she phrased it 
as from this going until 2013, what happens after 2013?
    Mr. Nelson. Well, that is the good question that probably 
needs to be asked because the rules have not been put into 
place so there is a lot of speculation as to where we will be 
as it gets to that time frame.
    Mr. Gardner. And so as of 2013 and beyond, this very well 
may be a situation where EPA comes in and starts requiring more 
permits in agriculture.
    Mr. Nelson. We believe that that probably will be the case, 
I can tell you, and we are not talking about the Clean Water 
Act today but just as a for instance, the amount of regulations 
that are coming out with nutrient management plans, MPDES 
permits, numeric standards, there is a whole tidal wave of 
regulatory challenges staring us in the face, so I think we 
would expect more of that.
    Mr. Gardner. And particularly too the greenhouse gas 
emissions regulation, and it goes a little bit to the question 
directed to Mr. Harnack as well. Costs of direct regulations, 
the indirect costs versus direct costs. When we say that 
agriculture--when Administrator Jackson says that agriculture 
is exempt, your energy costs will increase as a result of GHG, 
correct?
    Mr. Nelson. Yes.
    Mr. Gardner. The cost of fertilizer will increase as a 
result of regulation, correct?
    Mr. Nelson. Yes.
    Mr. Gardner. The cost of farm equipment will increase as a 
result of the regulation?
    Mr. Nelson. Yes.
    Mr. Gardner. Mr. Harnack, will you see costs increase as a 
result of the GHG regulation?
    Mr. Harnack. Yes, we will.
    Mr. Gardner. And so there are costs that you are facing 
whether direct or indirect which goes directly to your ability 
to create new jobs in the steel industry or to expand farms to 
future generations. Is that correct?
    Mr. Nelson. That is right.
    Mr. Gardner. And to Dr. Thorning, I don't know how familiar 
you are with the economy of California, but based on your 
experience as an economist, what you have seen in the State of 
California, the fact that 650 CEOs have said that it is the 
least desirable place to do Business, some of the regulations 
that we have seen, is California the kind of business model job 
creation market that we would like to export to the rest of the 
country?
    Ms. Thorning. I think one would have to look very carefully 
at what the impact of AB32 may have had on companies' desires 
to stay and manufacture in California. I think you have to look 
at the size of their budget deficit, their very high 
unemployment rate, their, you know, low relatively difficulty 
in the housing market. I don't think California is a poster 
child for how we want to go forward.
    Mr. Gardner. Mr. Goldstene, do you think California is a 
jobs creation model for the rest of the United States?
    Mr. Goldstene. I think there are many aspects of what is 
going on in California that should be copied by other States. 
We are the technology leader in the country. We are seeing a 
huge spike in investment since the passage of AB-32. People are 
coming here looking to have us move forward on our rules, 
provide the certainty that businesses want and also provide the 
certainty that creative, inventive Americans have proven over 
and over again to come up with the great ideas that are adopted 
here and other places.
    Mr. Gardner. Dr. Thorning, will the investments that are 
required to comply with these kind of regulations, greenhouse 
gas regulations, to produce these kinds of jobs, will they 
produce enough jobs in the green industry to offset the jobs 
lost elsewhere?
    Ms. Thorning. Well, I think it is highly unlikely because 
you are making investments that don't really add anything to 
the bottom line. They are being made, you know, to reduce 
greenhouse gases. So that is money that can't go into 
productivity enhancement investments.
    Mr. Gardner. So the bottom line is, does this regulation 
that we have been dealing with, what this bill deals with, does 
it affect our ability to be competitive globally?
    Ms. Thorning. I think it does in a negative fashion.
    Mr. Whitfield. Mr. Griffith, you are recognized for 5 
minutes.
    Mr. Griffith. Mr. Chairman, I just want to thank all the 
folks here for going through the day with us. I was not up here 
the whole time. At 4 o'clock I finally decided that I had to 
break down and eat something, so I went out in the other room 
and I was listening to your testimony, and I appreciate you all 
being here. I think all the questions have been asked, Mr. 
Chairman, so I yield my time back to the Chair.
    Mr. Whitfield. Thank you, Mr. Griffith. I want to thank all 
of you once again for your valuable testimony and your time, 
and we all have a lot of challenges before us. We don't agree 
on everything but that is what America is all about, so 
hopefully from hearings like this we can craft the best 
policies to move forward. So thank you very much.
    Mr. Rush. Mr. Chairman, before we adjourn, first of all, I 
want to thank all the witnesses on this panel and all the 
witnesses that preceded this panel, and I certainly want to let 
them know that they have really enlightened us. I haven't 
agreed on most of the testimony but at least I feel as though I 
am better informed, so I really appreciate the investment of 
your time. Thank you so very much.
    And before we adjourn, I do have an unanimous consent 
request but I guess you can dismiss the panel first. They don't 
want to hear a unanimous consent request.
    Mr. Whitfield. Well, without objection, we will----
    Mr. Rush. I have----
    Mr. Whitfield. I hate for them to leave before we leave.
    Mr. Rush. Well, I just have an unanimous consent request 
that statements and letters from the following organizations be 
placed in the record: the American Sustainable Business 
Council, the Calpine Corporation, the National Council of 
Churches, 68 faith communities throughout this Nation, the 
Natural Resources Defense Council, the Northeast States for 
Coordinated Air Use Management, the Truman National Security 
Project, the Union of Concerned Scientists, who also sent a 
letter that was also signed by 2,505 scientists and economists, 
and lastly, yesterday's letter from Mr. Waxman to Mr. Upton.
    Mr. Whitfield. And then we would like to enter this record 
from the National Association of Realtors, so without any 
objection, so ordered.
    [The information appears at the conclusion of the hearing.]
    Mr. Whitfield. The members will have 10 days to submit any 
questions for the record, and the record will be open for 30 
days. Thank you.
    [Whereupon, at 5:26 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]

                Prepared Statement of Hon. John Sullivan

    Chairman Whitfield: thank you for holding this legislative 
hearing today on the Energy Tax Prevention Act of 2011. This 
important legislation will help protect American jobs and 
businesses of all kinds from the regulatory onslaught of EPA's 
job destroying greenhouse gas regulations (GHGs) by prohibiting 
EPA from regulating GHG's under the Clean Air Act (CAA) and 
repeal the steps the agency has already taken to do so.
    I have several companies in my district ranging from 
chemical, manufacturing and energy companies that are scared to 
death of EPA's pending rules on GHGs. The energy industry 
employs over 320,000 workers in my state, and I intend to see 
that number grow by vigorously supporting this legislation.
    Today, I want to make special mention of the concerns of 
the agriculture interests in Oklahoma, since it is the second 
largest industry in my state. The Oklahoma Farm Bureau is 
deeply concerned that the costs imposed by EPA's GHG rules on 
utilities, refiners and manufactures to comply with these new 
regulations will trickle down the farming and ranching 
community, resulting in higher costs of production and food 
costs for American families, exactly what we don't need in a 
struggling economy!
    Additionally, many farmers and ranchers will have to obtain 
Title V operating permits that will cost agriculture interests 
close to $900 million. All told, 17,000 farms nationwide are 
impacted by EPA's GHG regulations. The point here is that even 
with EPA's so-called ``tailoring rule,'' which unilaterally 
raised CAA statutory thresholds to require GHG permitting for 
only the largest industrial sources of GHG emissions, 
industries of all stripes and consumers from every economic 
back grounds will suffer under the weight of EPA's excessive 
regulatory scheme.
    The Energy Tax Prevention Act is about protecting American 
jobs by preventing the EPA from unilaterally imposing a costly 
cap and trade style regulatory tax on the American people. 
Simply put, what the EPA and the Obama Administration has been 
unable to legislate through a cap and trade system, they are 
seeking to do it through backdoor regulation. This has to stop 
and I believe this legislation is the right approach. It is 
narrowly written to focus only on greenhouse gases related to 
climate change, and EPA's authority to monitor and regulate 
pollutants remains intact.
    Mr. Chairman, the Energy Tax Prevention Act of 2011 is 
important legislation to protect jobs, keep our nation 
competitive in foreign markets and provide economic certainty 
to the millions of American workers employed by industries that 
will be impacted by this backdoor national energy tax. This 
hearing marks our opening salvo to show the American people we 
mean business when it comes to growing our economy and 
identifying and removing job destroying regulations.
    I look forward to the testimony of our witnesses and I 
yield back the balance of my time.
                              ----------                              


              Prepared Statement of Hon. David B. McKinley

    Good morning. Chairman Whitefield and Ranking Member Rush, 
thank you for holding this hearing today to discuss the draft 
discussion of the Energy Tax Prevention Act of 2011.
    I look forward to hearing from our witnesses today, 
particularly the testimony and discussion of Environmental 
Protection Agency Administrator Lisa Jackson. Representing West 
Virginia's First Congressional District, it is my duty to 
ensure the citizens of West Virginia are protected not only for 
their health and safety, but to ensure that the current 
Administration's Agencies do not eradicate the industries they 
work in, and that they will be able to put food on the table 
for their families.
    With that being said, many of the EPA's regulations, 
whether in effect or proposed, will be detrimental to not only 
the State of West Virginia but to our entire Nation. We 
continue to see an EPA which circumvents the Congressional 
process by allowing bureaucrats to make decisions that should 
be left up to federal and state lawmakers.
    On January 13th of this year, the EPA took an unprecedented 
step to retroactively revoke a lawfully issued, four-year old, 
Section 404 permit for the Spruce No. 1 surface mine in Logan 
County, West Virginia. The implications of this action prompted 
me to file legislation to combat this blatant overreach by a 
federal agency, which is detrimental to the local businesses 
and hundreds of workers.
    This was not a regulation issued by the EPA, but rather was 
a permit issued under the Clean Water Act and approved by the 
Army Corps of Engineers in January 2007. For nearly a decade 
prior to 2007, the Army Corps of Engineers worked with the EPA 
to rigorously review the Spruce Mine project before it was 
approved. The permit was issued after an extensive 10-year 
environmental review, including a 1600 page Environmental 
Impact Statement (EIS) in which the EPA full participated and 
agreed to all terms and conditions included in the authorized 
permit. The EPA had every opportunity to address any concerns 
prior to when the permit was issued. Because of the EPA's 
chilling actions in revoking the permit, they prohibited the 
creation of 253 mining jobs and 298 indirect jobs, in addition 
to an investment of $250 million into the local community.
    I firmly believe that our states need a consistent and 
predictable regulatory program that will protect the jobs we 
have and create the jobs we need in an environmentally 
responsible manner. It is impossible for companies to take the 
necessary steps to move forward and create jobs if they have to 
live with the threat of unilateral retroactive revocation of 
the very permits that allow them to do business. The EPA cannot 
continue to punish the coal, manufacturing and natural gas 
industries. These are the industries vital to the survival of 
West Virginia and families will continue to suffer and be 
impoverished under this Administration.
    Any decisions from any agency or government entity should 
stem from the congressional review process, extensive studies, 
public input, review by other federal agencies, and peer review 
by experts.
    I look forward to hearing from the today's witnesses, and 
look forward to working with Subcommittee Chairman Whitfield 
and Chairman Upton in the full committee to ensure that lives, 
jobs, industries, families and our economy are protected.
    Thank you and I yield back.
                              ----------                              


                Prepared Statement of Hon. Cory Gardner

    Just the other day, my staff asked a fairly large electric 
corporation in my district how exactly these greenhouse gas 
regulations would affect Colorado. Their response was something 
to the effect of, ``With all the regulations coming down on our 
heads from EPA, we stopped doing a full-blown analysis of what 
each regulation would do to our customers.'' It is simply 
impossible to gauge exactly the job losses, exactly the rate 
increases, and exactly the effect on service to cities in my 
district. However, they know with all these regulations put 
together, it will be large.
    They, along with so many other businesses all over the 
country, cannot keep track of all the regulations they are 
going to have to abide by - but they are bracing themselves 
nonetheless, especially with regard to GHG regulation. They are 
anticipating having to absorb higher costs which will lead to 
job losses and less innovation among many other things. What's 
worse, these rules have the potential to affect even more 
businesses in the future if we don't stop it now.
    The Energy Tax Prevention Act does a couple key things. It 
prevents the EPA from regulating GHGs under the Clean Air Act 
(CAA), which it does not have the authority to do anyway. It 
also repeals steps that EPA has taken over the last two years 
to achieve the goal of GHG regulation. The bill does not, 
however, prevent the EPA from continuing its other obligations 
to protect the environment.
    The CAA was never meant to be a means to regulate GHGs. In 
fact, EPA was forced to change the CAA in order to make it work 
for the GHG regulations. The CAA as it existed before the 
infamous ``tailoring rule'' allowed for regulation of various 
``conventional pollutants.'' This includes things like lead and 
nitrogen dioxide. However, the threshold laid out in the CAA 
was far too low for greenhouse gases. If the CAA was 
interpreted to regulate GHGs under its original thresholds, 
virtually no businesses that emitted any sort of GHG would be 
able to avoid serious federal regulation. This change has 
proven that the CAA was never meant for regulating GHGs.
    Despite these facts, here we are. The EPA has done no 
thorough analysis of how this will affect industry, jobs, and 
energy prices but that has not stopped them from moving right 
along with their agenda. And they are continuing this 
regulatory scheme despite failed attempts to pass a similar cap 
and tax bill in both houses of Congress. This is nothing but a 
runaround attempt at a national energy tax - forcing consumers 
to pick up the bill for an agenda that hurts jobs and 
businesses, and not allowing for a thorough vetting process. 
Further, states simply are not prepared for the new permitting 
requirements laid out in the regulation, which are likely to 
delay new energy projects from being built.
    Mr. Chairman, this is just the beginning of what EPA will 
do if we continue to let them. If we do not change our course 
now, businesses will do what they do best - they'll find 
another market, and it's likely that market will have little or 
no regulation on GHGs. This will cost us jobs and lead us down 
a path that does not end at energy independence. I support this 
bill as a solution to the future job losses and energy price 
increases that our nation will experience if we allow these 
regulations to move forward. I yield back my time.
                              ----------                              


                      Statement of Hon. Lois Capps

    Mr. Chairman, I'm troubled we're here this morning. 
Americans still are facing staggering unemployment rates, and 
our economy has not yet fully recovered.
    But instead of holding hearings on ways to generate more 
clean energy jobs and improve the health of American families, 
we're reviewing an extreme proposal that would block EPA from 
doing its job: protecting our health from air pollution.
    Mr. Chairman, not allowing the EPA to address carbon 
pollution under the Clean Air Act is flat-out dangerous.
    Climate change is a serious problem. The scientific 
evidence is clear. The debate is over. Climate change is real. 
It's happening. And, human beings are largely to blame.
    2010 was the hottest year on record. And in the last decade 
the Earth experienced 9 of the 10 hottest years since data has 
been recorded.
    We're also starting to see the irreversible damage to our 
economy and our environment.
    Sea levels are rising. The world is witnessing increased 
rainfall, floods, droughts, and wildfires. And, our fresh water 
supplies and capacity to grow enough food will be severely 
challenged in the years ahead.
    Mr. Chairman, the longer we delay taking action to address 
climate change, the more difficult and expensive the solutions 
will be.
    That's why the EPA is taking a cautious, flexible and 
balanced approach to addressing carbon pollution. And each of 
the steps they've taken so far has followed the letter of the 
law.
    For four decades, the Clean Air Act has protected the 
health of millions of Americans - including our children, our 
seniors and the most vulnerable among us - from all kinds of 
dangerous air pollutants.
    The law also has a tremendous track record in providing 
certainty to business and delivering economic benefits.
    For example, since the Clean Air Act was enacted overall 
air pollution has dropped while U.S. GDP has risen 207 percent. 
And we've also seen major health benefits, including asthma 
reduction, lower lung cancer rates, and much greater 
productivity.
    In fact, by 2020 the benefits of the Clean Air Act are 
expected to reach $2 trillion, exceeding any costs by more than 
30 to 1.
    All of these benefits, Mr. Chairman, are jeopardized by 
this proposed rollback to the Clean Air Act.
    And that's why groups ranging from the American Lung 
Association to the American Sustainable Business Council have 
decried the harm of this proposal to people's health and 
economy. And it's why I stand with them today in opposing this 
extreme proposal.
    Here's what this proposed bill would do.
    First, it would declare that carbon pollution is not an air 
pollutant and repeal the EPA's science based endangerment 
finding, throwing the findings of the National Academy of 
Sciences, federal government agencies and countless other 
scientific experts out the window.
    Second, it would also repeal every action the EPA has 
already taken and block every action EPA is developing to limit 
carbon pollution from power plants and oil refineries, giving 
the nation's biggest polluters a free pass for unlimited carbon 
pollution.
    Third, it would tear up the historic agreement reached by 
the Obama administration, the nation's automakers and states to 
cut carbon pollution and fuel consumption in new cars and 
trucks. This means more air pollution and higher fuel bills for 
all Americans in the future.
    Mr. Chairman, this is an unprecedented, extreme proposal 
and it should not go forward.
    Last month, President Obama stood on the House floor and 
talked about ``winning the future'' through innovation. And he 
used clean energy as his central example.
    We know that clean energy will help our economy grow. It 
will help America compete in the global marketplace. And it 
will help protect Americans' health and quality of life.
    Let's not obstruct the EPA from doing its job of protecting 
the public's health and environment.
    This is a crucial issue, Mr. Chairman, for the public and 
our planet.
    It's our duty here to ensure both are protected from 
harmful carbon pollution. And unfortunately, this extreme 
proposal just doesn't meet this crucial test.
                              ----------                              

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