Statement Prepared for EPA Public Hearing on Proposed Carbon Pollution 

Standards 

By 

James F. Casey 

Associate Professor of Economics 

Washington and Lee University 

May 24, 2012 

Washington D.C. 

Good Evening, my name is James F. Casey. I am a Professor of Economics at 

Washington and Lee University in Lexington, Virginia. My primary area of teaching 

and research is environmental economics and policy. Today, on behalf of the Union 

of Concerned Scientists, I would like to express my support for the standards to limit 

carbon emissions from new power plants. I hope the EPA will move quickly to 

finalize and implement limits on carbon emissions from new power plants. Then, 

take the next, critical, step and issue standards to reduce carbon emissions and all 

greenhouse gas emissions (GHGs) from all existing power plants. In the brief time I 

have this evening I will explain why I advocate this set of actions. 

A quick question -What do Paul Krugman (the Nobel Prize winning economics 

professor at Princeton University) and Greg Mankiw (Professor of Economics at 

Harvard who serves as an advisor to Mitt Romney and is the author of a best selling 

economics textbook) have in common? 

Aside from having Ph.Ds in economics-- not much. One might even argue that they 

currently represent the polemics of liberal and conservative economic thought, yet 

they both want to regulate and reduce greenhouse gas emissions-- and they are not 

alone. I certainly stand with both of them on this policy objective. 

101 fact, in Apri: of 1997, more than 2,000 economists signed the Economists' 

Statement on Climate Change. Again, in March of 2010, more than 2,000 scientists 

and economists (including myself and several of my colleagues at Washington and 

Lee) endorsed the Union of Concerned Scientists' call for "swift and deep cuts in 

greenhouse gas emissions." Why? Because adherents to standard economic theory 

recognize the negative side effects generated by greenhouse gases, which 

predisposes them to favor strong environmental protection. 

Economists generally believe free markets are the most efficient way to direct 

consumption and investment decisions in an economy as long as the prices are 

right. Unfortunately energy markets get their prices wrong. Producers and 
consumers do not pay for the damage of burning the fuels traded in these markets. 

Due to these massive external costs, prices are set inefficiently low and pollution 

levels, particularly GHG emissions, are inefficiently high - much too high. 

Internalizing the externalities associated with carbon emissions is an important step 

toward creating a more economic system. 

Additionally, according to a 2009 report from the World Coal Association, "climate 

change is a global challenge and requires a concerted global response. The world 

can be set on course to a sustainable energy future, provided we make the 

necessary investments and policy decisions." By choosing to set limits on the 

amount of carbon emitted from power plants the Environmental Protection Agency is 

beginning to set us on such a course. Not only will the limits reduce future 

emissions, but they provide an incentive for the private sector to make the necessary 

investments to reduce the negative environmental footprint that characterizes our 

current economic behavior. 

Climate change has already altered our environment, and with it the pattern of 

diseases. Let me be clear, this is a scientific fact, it is not in dispute. Those that 

claim climate change has had little it any substantive impact are ignoring the 

scientific evidence on this topic. -Unfortunately no one is more vulnerable to the 

adverse health consequences that accompany climate change generated by 

greenhouse gases than young children. In recent years, they have had to battle an 

increasing number of respiratory illnesses, allergies, infections, and 

immunosuppresive disorders, just to name a few, according to the Center for Health 

and Global Environment at Harvard University. 

We cannot continue to allow for the unregulated release of GHGs into our 

atmosphere. The United States must take the lead in the battle to reduce the costs 

and impacts associated with Climate Change- especially the costs being placed on 

our children. The new EPA carbon standards are a critical step toward reducing the 

effects of climate change and protecting public health. Thus, the time has come to 

support EPA in its important work to protect and ensure the health and safety of our 

nation.