Job-killing regulations? Opponents fail to support claims with evidence

Original Reporting | ByJames Lardner | Regulation

This time it will really be terrible

Rep. John Carter of Texas has introduced a resolution under the Congressional Review Act to bar the EPA from implementing rules, announced last August, that would compel the Portland cement industry to reduce its levels of mercury and particle pollution. That pollution has been linked to a range of serious health problems, including asthma, irregular heartbeat, heart attacks, and damage to fetal and child brain development.

In an interview with Remapping Debate last week, Carter stressed the jobs threat posed by these rules. He said that while he supports tougher standards, “as does the industry itself,” the EPA’s current proposals did not provide the industry with the flexibility for a “reasonable compliance process.”

Cement makers have advised Carter that it will cost as much as $3.8 billion to meet the new standards; the EPA puts the price tag at slightly under $1 billion. Either way, Carter told Remapping Debate, it’s big money for an industry with a net worth of $10 billion — enough that “you have to start really saying, can we really be in this country? Are our choices better in Mexico or in China or someplace else? Or are we going to spent $3.8 billion just to be able to make these products inside the continental United States.”

The new chairman of the Energy and Commerce Committee, Rep. Fred Upton (R-MI), has vowed to resist what he calls the EPA’s "unconstitutional power grab that will kill millions of jobs."

Carter acknowledged in the interview, however, that he could not point to any case of past job-destroying regulation. The only data he possessed, he said, involved the Portland cement industry, and in that case, he said frankly, he was relying on figures generated by the industry itself.

 

Evidence not forthcoming

In September, the EPA formally announced greenhouse gas emission limits for new and modified power plants, and said it would begin to draft rules for existing plants, to be announced by Nov. 2012 and put into effect gradually over succeeding years. Since that announcement, a number of Republican legislators have introduced bills designed to delay or block EPA action.

The new chairman of the Energy and Commerce Committee, Rep. Fred Upton (R-MI), has not endorsed any of these measures. In a recent statement, however, Upton portrayed the EPA as an agency with “its foot firmly on the throat of our economic recovery.” By one means or another, Upton has vowed to resist what he calls an “unconstitutional power grab that will kill millions of jobs.”

Remapping Debate asked Rep. Upton both for evidence of the threat posed by the current EPA proposal, and for past instances of environmental regulation that had been responsible for large-scale job losses. In the middle of last week, his office promised that responses would be forthcoming promptly. At press time, however, nothing had been produced.

Remapping Debate put the same questions to a series of other opponents of regulation, with similar results (see bottom box).

Rep. Mike Simpson of Idaho, who has characterized the EPA as “the scariest agency in the federal government, an agency run amok,” did respond to Remapping Debate’s questions by email. In that response, Simpson spoke generally of being told by “company after company, big and small…how they are sitting on capital rather than creating jobs or investing in the growth of their businesses because they don’t know how EPA’s regulations are going to affect them.” He did not, however, address the request for current or historical evidence of economic harm.

Don Norman, chief economist of the Machinery and Applied Products Institute, is a critic of the EPA’s efforts to regulate greenhouse gases who does acknowledge the historic success and cost-effectiveness of the Clean Air Act. “I think environmental regulation is a good thing,” he said. “As living standards rise, people tend to demand more of it. The question is, where do you draw the line?” Norman argues that in its current initiatives, the EPA is trying to move from an area with large potential for improvements at low cost, toward one where the costs will be high and the gains smaller.

Norman is the author of an Oct. 2010 study, funded in part by the American Petroleum Institute, that predicts a net loss of 7.3 million jobs by the year 2020 if the EPA is permitted to proceed with regulation of greenhouse gases. Since its publication, the study has been cited by several opponents of such regulation. “When the EPA first came along,” he said,

Show us the evidence

Remapping Debate invited several prominent opponents of regulation, in and out of government, to provide evidence of EPA regulations that “killed” jobs. Each of the following was apparently unable or unwilling to do so:

  • Margo Thorning, chief economist of the American Council for Capital Formation and the author of a 2010 study that predicted a loss of 2.4 million jobs if the Waxman-Markey cap and trade bill were enacted and implemented.
  • Rosario Palmieri, vice president for infrastructure, legal and regulatory policy at the National Association of Manufacturers, which commissioned the ACCF study and which, on its website, declares the EPA’s proposals a threat to "manufacturers, businesses and jobs throughout America."
  • Nicole V. Crain and William M. Crain, co-authors of a widely cited study — done for the Small Business Administration’s Office of Advocacy — putting the total annual cost of all regulation at $1.7 trillion — a figure far higher than most such assessments.
  • Rep. Darrell Issa (R-CA), the new chairman of the Oversight and Government Reform committee, who has announced an inquiry into the "impact of government hyperregulation on job creation."
  • Rep. Geoff Davis (R-KY), the prime House sponsor of the REINS Act, which, by requiring congressional approval of every major rule " before it could be enforced on the American people and businesses," aims to "rein in the costly overreach of federal agencies that stifles job creation and hinders economic growth."
  • Rep. Marsha Blackburn (R-TN), whose Free Industry Act would amend the Clean Air Act to declare that nothing in that law "shall be treated as authorizing or requiring the regulation of climate change or global warming."
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