The court battle over the Environmental Protection Agency’s “breathtaking expansion” of its powers with the Clean Power Plan also means a renewed spotlight on the Obama administration’s tax and environmental policies and the chilling effect they will have on American jobs and growth. The CPP, the administration’s “signature” climate change policy that regulates power plant carbon emissions, has been challenged by West Virginia and dozens of other states.
Although she subsequently disavowed her own statement, Secretary of State Hillary Clinton best articulated the aim of that policy when she said, “We’re going to put a lot of coal miners and coal companies out of business.”
Forced to comment on the Clinton assessment, EPA chief Gina McCarthy declined to repudiate it, asserting awkwardly, “It’s certainly not good for anybody to be out of work in an economy. … I do not agree that anyone in the United States of America should go without a job.”
It’s a statement marinated in irony, considering McCarthy and the Obama administration advocate continuously for tax and environmental policies that will crush American energy industry jobs, inflate the already swollen ranks of the unemployed, and raise energy costs for the entire nation.
One needs look no further than President Obama’s Fiscal Year 2017 budget to understand the president’s agenda. It’s a laundry list of new energy taxes and other restrictive measures designed to punish, constrain and further burden the oil and gas industry. For example, Obama’s budget includes the repeal of many business tax provisions — like the domestic manufacturing deduction — solely for oil and gas companies, even though they are used by virtually all manufacturers, in every sector.
The oil and gas sector lost “hundreds of thousands” of jobs all across the labor market and “cut about half a percentage point off economic growth” this past year, according to Moody’s Analytics. A weak economy means taxpayers will be shortchanged from much-needed revenue and more unemployed workers mean higher spending on government programs.
The net loss to the industry itself — 114,000 jobs — is just a small part of the story. Because the traditional energy sector in America is generally so vast and beneficial to communities all throughout the country, when it suffers, it does not do so alone.
Myriad industries are adversely affected, and exponentially. Moody’s estimates that for every lost oil and gas job there are an additional 3.43 jobs lost in other sectors. Today 37 percent of them are “directly affected by the energy industry,” like in steel production and railcars for oil transportation, while the remaining 63 percent are attributable to laid off employees’ reduced spending on “hotels, retail and health care.”
All of which means that the “114,000 job losses wiped out an additional 391,000 jobs in other sectors last year and sliced economic growth to about 2.1 percent from 2.6 percent.”
It is against this alarming backdrop that the Obama administration has pursued several tax and environmental policies that can only have one result: hindering growth in the energy sector.
The 2017 budget also proposed raising the federal oil tax by $10.25 per barrel, upping the price of gasoline by 25 cents a gallon, or approximately $5 more for every trip to the pump. This increased fuel price would directly affect working families, commuters, taxpayers and every single business (most) reliant on the steady flow of affordable fuel to run its operations. Margins will shrink or vanish, additional costs will be passed on to the consumer, and all Americans will suffer … the largest burden falling upon those who can least afford it.
On the heels of last year’s ozone rule — tagged as possibly one of the most expensive regulations in history — the administration is now pushing to implement methane emission regulations that would discourage the very shale revolution that lowered energy prices for all Americans and which helped reduce emissions in the first place. More recently, it was announced the administration would stop issuing Atlantic exploration leases, further hampering the industry’s ability to satisfy demand with affordable inventory.
It seems the Obama administration is alone in not recognizing that America’s economy is barely sputtering along while working families continue to struggle. America is in need of tax policies that are fair and universally applied, not rhetoric in disguise that picks winners and losers in the marketplace. Taxpayers should not be punished because of misguided policies by this, or any other president.