In the ‘Green’ Economy, the Poor Pay More

Kelly Miller
Acton Institute for the study of religion and liberty

Cap-and-trade legislation has died, with little hope of resurrection for a long time to come. What the representatives of the people cannot accomplish, however, the Environmental Protection Agency can.

The EPA’s Lisa Jackson has denied ten petitions filed by the U.S. Chamber of Commerce, Republican attorneys general from Texas and Virginia, and other conservative groups. The petitioners asked the EPA to reconsider its finding that greenhouse gases endanger public health and welfare, and therefore must be regulated under the Clean Air Act. The EPA has refused to reconsider, and plans to regulate emissions from new cars and trucks this year, and emissions from power plants next year. The state of Texas is now threatening not to conform to the new regulations…

…the EPA believes that regulating emissions will improve the American economy by creating “green” jobs.  The evidence, however, does not support this line of reasoning.  The government simply cannot create jobs in one industry without destroying jobs elsewhere.  For every “green” job Spain has created by subsidizing wind and solar energy, it has destroyed 2.2 jobs created by the private sector.  Green jobs have done nothing to improve Spain’s 19 percent unemployment rate.  Denmark actually spends more money on creating jobs in the wind energy industry than the jobs actually pay…

…Under the cap-and-trade bill considered by the House of Representatives, the average American family would likely face a 90 percent increase in electricity prices, according to research done by The Heritage Foundation.  Gasoline and natural gas prices would also rise by over 50 percent.  The economic impact of EPA regulation would be even worse than the impact of cap-and-trade legislation, because regulation would involve more compliance, administrative, and legal costs.

Skyrocketing energy prices would cause the prices of most other goods and services to rise as well, because energy is the lifeblood of the economy.  Almost nothing happens – no manufacturing, no transportation, and no sales – without energy.  For people who already have plenty of money – think John Kerry and Bill Gates – this is not much of a problem.  But economically vulnerable groups already spend much larger portions of their budgets on basic necessities than do those who are better off.  The poor have less discretionary income to spend on things they don’t absolutely need, and therefore less room to breathe when expenses rise.

This economic burden would come in addition to other financial woes caused by carbon regulation.  An economy struggling under dramatic decreases in employment, household income, and national GDP would make it even more difficult for low-income families to cover expenses, especially utilities.  Families who could not afford to heat or cool their homes, especially the elderly, would risk their health and could end up homeless.  After inability to pay rent, inability to pay utilities is the most common cause of homelessness…

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