US President Bill Clinton has jeopardized economic growth by signing an executive order that requires environmental reviews for trade agreements. The potential harm to energy demand means trouble for the oil and gas industry.
Timing makes clear the political motives behind Clinton's move. He signed the order Nov. 16 as word was spreading about environmental protests planned for this week's World Trade Organization meeting in Seattle. The order thus polishes his environmentalist record for critics who think he hasn't been aggressive enough. The criticism has been a problem for the presidential ambitions of Vice-Pres. Al Gore, who announced the order in Seattle.
In his announcement, Gore tried to deflect concern about economic consequences. "I...believe that a strong economy and a clean environment go hand in hand around the world," he declared in a characteristic usurpation of the obvious.
The vice-president's philosophical point is, of course, not the issue. The issue is the wisdom of granting environmentalists the equivalent of veto power in trade negotiations. Of course, Clinton's executive order doesn't explicitly extend such power. But it will have the same effect.
In the US, the requirement for formal environmental review has become a potent tool for obstructionism. It has, for example, curtailed oil and gas drilling on federal land in the US West. Where environmental impact statements warn of harm, leasing and drilling either don't occur or become subject to land-use stipulations that limit activity or discourage it altogether. Where environmental impact statements don't warn of significant harm, pressure groups delay activity by challenging sufficiency of the document itself and the review on which it is based.
The same will happen with trade. Environmental groups deciding they dislike a prospective agreement will be able to delay negotiations into oblivion by challenging nothing more than the adequacy of the environmental review. This amounts to veto power, granted to win political favor from environmentalists.
Clinton and Gore will have a ready response to that charge. They'll say it is only prudent to integrate environmental decision-making with trade negotiations. The executive order asserts that the US "is committed to a policy of careful assessment and consideration of the environmental impacts of trade agreements." That, to the inexperienced ear, sounds reasonable.
But what "impacts" are there to assess at the stage of trade negotiations? Trade agreements address markets, not projects whose environmental effects can be studied and measured. The main effects of a successful trade negotiation are expanded trade among the parties and accelerated economic growth by them all. The only possible environmental impact to review is an increase in economic activity. The rest, at that stage, is guesswork. Too often, however, guesswork is enough for environmentalists, for too many of whom economic activity alone is the problem.
A requirement for environmental review of trade negotiations thus represents a potential brake on nothing more definite than the phenomenon of growth itself. That is perverse.
Submitting to alarmism
Clinton's executive order submits too much economic fate to the caprice of environmental alarmism. It would enable pressure groups to steer human events by merely articulating what might happen, whether or not their warnings have any foundation in science and technology. For an illuminating parallel, see the out-of-control politics of global warming.
The oil and gas industry should not have to fight this arrogation of power alone. Clinton's move will trouble anyone concerned about global economic growth and the welfare of people. And it should trouble any official body-starting, it would seem, with the US Congress-offended by grants of effective authority to unofficial pressure groups.