Green Money: The Perpetual Motion Machine
The Washington Examiner is publishing a five-part special report in association with Pajamas Media on “Big Green”: the alliance of the Democratic Party, environmental groups, and activists in the progressive movement. It’s not just a band of flannel-shirted environmentalists any longer; it’s become a big-money, major player in Washington power politics and American elections.
In the third of five pieces, we examine how "Big Green" uses its political power to get taxpayer money, which is then used to enhance its political power. The result: a self-perpetuating environmental activism industry, funded by taxpayers.
In today's Examiner, the "Big Green" series looks at how the environmental activism industry is funded. With the dues and contributions of millions of environmentally concerned citizens, of course, the various environmental groups start out with millions of dollars in annual revenue, and literally billions of dollars in assets, all dedicated to protecting the environment; that must be the source of their funding.
Wouldn't it be pretty to think so?
Because of convenient peculiarities in the laws, and some special relationships with the federal government, a large part of the environmental groups' funding for legal aspects of their Good Works comes, not from their own assets, but directly from the federal government.
This can work in several ways. First, environmental groups receive federal grants that provide cash to the group; cash, being fungible, can be used to pay attorneys and staffers on many different projects. While federal grants are, in theory, targeted to a specific area of research, the acceptable "overhead" charges can pay for a fair bit of staffer time between grants. (This, by the way, isn't inherently illicit: any non-profit that operates on "soft money" needs to be able to bridge salaries from one grant to the next in order to retain their best people.)
Second, sometimes the EPA or Department of the Interior will file a suit on their own behalf, but then allow various environmental groups to join the action as co-plaintiffs. Some environmental groups, like the National Resources Defense Council and the Environmental Defense Fund, specialize in these sorts of legal actions. Often, if the EPA wins a judgment, the result will be that the loser pays not only their own legal fees, but also pays fees or otherwise compensates their co-plaintiffs. If not, these groups at the very least get to piggyback their own legal work on the EPA's vast hoard of government-paid lawyers, leveraging whatever money of their own they do invest.
The third approach is the strangest. As Mark Hemingway's piece today explains, in certain cases, the EPA actually pays environmental groups that are suing the EPA.
The legal rationale is simple enough, at least to a lawyer: in cases like Massachusetts v. Environmental Protection Agency, the EPA could hardly sue itself. There must be another party with standing; if it just happens that the EPA is also giving the same parties a little money -- in this case, a measly $7,656,829 minimum -- that's not important.
The fourth method is possibly the worst of the bunch. As Karen Budd-Falen described here in PJM last week ("Radical Environmental Groups Extorting Federal Money with Lawsuit Threats ", PJM 22 Sept 2010), one of the most effective ways in which environmental groups obtain funding is by simply using lawsuits, and the threat of lawsuits, to obtain "settlements."
This has become particularly popular in the Western U.S. Basically, imagine you have a new construction project. A pipeline, let's say. An environmental group then files suit to prevent the project from going forward. That environmental group may have lawyers working for them pro bono, and they often have the implied backing of the Department of the Interior. You look at the lawsuit, consider the legal costs, and consider the opportunity cost of spending years in court before you can proceed -- and you, quite sensibly, offer the environmental group money to go away. As Budd-Falen points out, this was exactly what happened with the Ruby Project, a pipeline intended to take natural gas (a relatively clean, carbon-sparing fuel) from Wyoming to super-green Oregon.
In the settlement, the Ruby Project made no changes to the project, altered no plans. It just paid the Oregon Natural Desert Association and the Western Watersheds Project $22 million to drop their suit.
You can buy a lot of legal filings with $22 million.
Which, one has to suspect, is the point. The executives, directors, and attorneys involved may sometimes work pro bono publico -- "for the public good" -- but often the salaries paid and expenses charged seem to involve quite a bit of more personal, private bono.
It becomes a perpetual motion money machine of the environmental activism industry: the lawsuit settlements pay rich salaries and fund further lawsuits, which lead to more settlements, and then to more lawsuits. Without producing anything of value, or even, as in the Ruby Project, without changing the environmental impact of the project in any way, environmental groups impose their own private "tax" on productive work all over the world -- and the money keeps rolling in.