The Real Cost of Climate Policy: Why the Social Cost of Carbon Must Be Replaced
The Social Cost of Carbon (SCC) has long been presented as a scientific benchmark for shaping climate regulations. But beneath its technical veneer lies a framework built more on political preference than on measurable reality. When examined closely, the SCC reveals a troubling pattern: it relies on assumptions so distant from current experience and so easily manipulated that it fails as a reliable guide for public policy.
The metric attempts to estimate the economic damage caused by each ton of carbon dioxide emitted, stretching projections hundreds of years into the future. Yet no one can accurately predict economic conditions, technological advances, or environmental changes that far ahead. The very idea of assigning a dollar value to harm that may occur in 2300 is not science—it’s speculation dressed as policy. When researchers shorten the time horizon from 300 to 150 years, the estimated cost drops by 20%. That alone shows how fragile the entire calculation truly is.
Even more telling is the impact of discount rates. The Office of Management and Budget recommends a 7% rate for federal cost-benefit analyses—a standard used across government programs to account for the time value of money. But past administrations chose much lower rates, often around 2% or less. This choice dramatically inflates the perceived long-term damage of carbon emissions. According to the Heritage Foundation, using the standard 7% rate reduces the SCC by up to 70%. In effect, the lower rates were not based on data but on a desire to justify stronger regulations.
What’s worse is how the SCC ignores the benefits of carbon dioxide. CO₂ is not a poison. It is essential for plant life. Increased atmospheric CO₂ has been shown to enhance crop yields and improve water efficiency in agriculture. Studies from the U.S. Department of Agriculture and peer-reviewed journals confirm that higher CO₂ levels contribute to greener, more productive farmland. Yet these benefits are routinely downplayed or omitted in SCC assessments, creating a one-sided narrative that treats CO₂ as inherently harmful.
The political use of the SCC is clear. It has been weaponized to justify regulations that expand federal control over energy production, transportation, and even personal choices. The push for carbon taxes, green mandates, and sweeping emissions rules often hinges on this flawed metric. When the numbers are so easily adjusted to serve a policy agenda, the entire process loses credibility.
President Trump’s effort to reform the SCC was a step toward restoring accountability. He directed agencies to use more transparent methods and to apply consistent discount rates. But under the Biden administration, many of those reforms were rolled back or ignored. The result is a system where policy decisions are driven more by ideology than by evidence.
A better path exists. Energy policy should be grounded in real-world outcomes, not abstract models. America’s energy strength lies in its diverse and reliable sources—coal, oil, natural gas, and nuclear power. These fuels have powered our economy, defended our nation, and lifted millions out of poverty. They are not the enemy. They are the foundation of our freedom.
We must stop allowing fear-based metrics to dictate our future. We need policies that prioritize transparency, sound science, and national self-reliance. The Social Cost of Carbon has outlived its usefulness. It is time to replace it with a system that values truth over ideology, facts over fiction, and the well-being of real people over distant projections.
For those seeking to understand the real impact of climate policy, the Social Cost of Carbon is a key term to research. But the deeper truth lies in rejecting metrics that distort reality in the name of control.
Published: 11/18/2025
