Today, the House Energy & Commerce Subcommittee on Energy & Power examined the impact just one of the thousands of excessive government regulations coming out of Democrat-run Washington will have on jobs, manufacturing and electricity prices.  Although required by Executive Order to conduct its own assessment of the costs and benefits of new regulations, the Obama Administration’s analysis was too narrow and unrealistic to provide an accurate picture of how new regulations on power plants – the so-called “Utility MACT” rule – will impact the economy.  Witnesses at today’s hearing provided a more comprehensive, and alarming, assessment:

  • Hundreds of Thousands of Jobs Lost Without Justification.  NERA Economic Consulting Senior Vice President Anne E. Smith, a specialist in environmental risk assessment and integrated assessment to support environmental policy decisions, found that the Utility MACT rule will cost the U.S. economy more than $10 billion annually by 2015, and “destroy hundreds of thousands” of jobs.  According to Smith, “the net impact to U.S. workers in 2015 will be a reduction in worker income that is equivalent to about 200,000 full-time jobs.” (Testimony, 2/8/12) Job losses will be particularly devastating to the Navajo Nation, which had an unemployment rate above 50 percent in 2007.  Harrison Tsosie, Attorney General of the Navajo Nation, says that plant closures on Navajo land forced by the Utility MACT rule will result in “devastation to the local Navajo economy” and “force migration of many Navajo workers from their native homeland in search of jobs.” (Testimony, 2/8/12)  The Obama Administration’s claim that the health benefits of Utility MACT justify these significant economic costs and job losses does not withstand scrutiny.  As Dr. Julie Goodman, a board-certified toxicologist, testified, the health benefits cited by the administration are “grossly inflated and not realistic” because “the methods used to derive these benefits are fraught with large uncertainties, which likely resulted in a large overestimation of benefits.” (Testimony, 2/8/12)
  • American Manufacturing Put in Jeopardy.  Despite recently declaring that American manufacturing was the keystone of an American economy “built to last,” President Obama’s support for the burdensome Utility MACT rule will actually undermine jobs and growth in the manufacturing sector, according to Gerdau Long Steel North America Energy Director Darren MacDonald.  At today’s hearing, MacDonald warned that, as a result of higher energy costs brought on by the rule, the “manufacturing sector will experience greater challenges in maintaining our business in the U.S. and sustaining related employment.”  MacDonald further noted that “from a manufacturing sector perspective, additional costs will have significant impacts on investments and jobs. Simply not knowing who is right about the price of electricity over the next five to ten years – EPA or other forecasters – creates too much uncertainty with respect to large capital investments.”  The increased cost of doing business in America will ensure that “any product that is displaced in the U.S. will be made in a country with less air regulations,” MacDonald added. (Testimony, 2/8/12)
  • Less American Energy.  Ralph E. Roberson, President of RMB Consulting & Research, Inc., says that the new rules are “so stringent that no technology is available that can meet them,” adding that “these standards therefore will prevent new coal -fired EGUs [Electric Generating Units] from being built.” (Testimony, 2/8/12)

These disastrous consequences could have been prevented if Senate Democrats had acted on the bipartisan Transparency in Regulatory Analysis of Impacts on the Nation (TRAIN) Act (H.R. 2401), House-passed legislation that would have stopped Utility MACT from taking effect without a cumulative analysis of its impact on jobs and the economy.  Despite warnings from 25 states and American manufacturers, Senate Democrats stood idle – just as they have with nearly 30 other Republican Plan for America’s Job Creators bills waiting for a Senate vote.  Even the president’s own jobs council recommends “a series of regulatory reforms” that includes “conducting regulatory impact analysis.”  There is no excuse for Democrats’ inaction.

While President Obama supports excessive government regulations that will cost jobs and lessen American energy, House Republicans are taking action on the American Energy & Infrastructure Jobs Act, legislation that – in stark contrast to the president’s actions – will help create jobs by removing government barriers to American energy production and instituting pro-growth infrastructure reforms.  Five House committees have already acted on the legislation, which is expected to be considered on the floor next week.  Learn more about the American Energy & Infrastructure Jobs Act at Speaker.gov/energy and follow the progress of the legislation on the American Energy Initiative Facebook page: Facebook.com/americanenergy.