The same ethical advice for doctors also makes sense for Congress as it considers several pending global warming bills – first do no harm. Given serious questions about global warming science as well as the efficacy of costly proposals to address it, the best choice for Washington is none of the above.
With economy-wide cap and trade stalled in the Senate, a number of slightly scaled back variants have been proposed, including measures targeting selected industries or a carbon tax. All threaten to do more harm than good.
Before considering these measures, Congress should first get to the bottom of Climategate, Glaciergate, Hurricanegate, Amazongate, and other scandals that raise troubling questions about scientific credibility. Virtually every scary claim used to justify precipitous action—unprecedented temperatures, rapidly melting glaciers, increasing hurricanes, plummeting crop yields, disappearing rainforests—is under genuine suspicion. The fact that temperatures have been statistically flat since 1995 is another reason not to treat global warming as a dire crisis.
Haste in light of these scientific doubts is all the more troublesome given the cost of cracking down on fossil fuels, no matter how imposed. All of the legislative proposals have one thing in common—they reduce carbon dioxide emissions by driving up the cost of energy so that individuals and businesses are forced to use less. Inflicting significant economic pain (likely trillions of dollars and millions of jobs for cap and trade, somewhat less for watered down measures) is how this all works.
These measures have another thing in common—their uselessness. Even if one still believes the worst case scenarios of global warming, unilateral action against the American people and American economy would hardly dent the upward trajectory of emissions. China alone out emits the U.S. and its emissions growth is projected to be nine times higher than ours. And it is hard to ignore Chinese government officials’ frequent and unambiguous statements that they will never impose similar restrictions on themselves, though some global warming activists still try.
Washington cracking down on fossil fuels in the name of addressing global warming would result in much economic pain for little if any environmental gain. First do no harm.
The stock market reacted favorably this morning when it was announced that the number of people on payrolls fell by 36,000 in February, better than the 50,000 loss expected by economists. The unemployment rate held steady at 9.7%, also slightly better than expected.
Another indicator that may have received less attention is the 15-Week unemployment rate—the percent of the labor force that has been unemployed for 15 weeks or longer and is still looking for employment. In December, 2007 this statistic stood at only 1.6%. In February, 2010, it was 363% higher at 5.8%. This, after three “stimulus” bills during the time frame is proof that the idea that we can “spend our way out of recession” is for the birds. In fact, after rising the astronomical 363%, the rolls of those unemployed 15 weeks or more has only declined by 147,000 since it peaked in November of 2009 at 8 million 976 thousand people looking for work.
The longer-term 15-week unemployment rate is most often used to detect the level of economic pain being felt in the economy. Equally important though, this statistic reveals the percent of the workforce whose skills are eroding by not being put to use. People unemployed for 15 weeks or longer are becoming less employable as time goes by. Skills deteriorate when not put to use. Therefore the chart below is alarming.
“Stimulus Bill” spending crowds out the private sector. There are more government jobs competing with private market jobs and it is not a level playing field. The government jobs are paid by the taxpayers regardless of whether their employers run them prudently because it can operate at a loss indefinitely until the government goes bankrupt and the federal spigot must be turned off. Jane Businesswoman in the private sector though has to remain profitable and compete.
Another problem with “Stimulus Bill” spending is that many workers hired by the government are paid Davis Bacon wages, which are artificially high. Therefore fewer workers can be hired, contributing to longer-term unemployment.
The solution to fighting longer-term unemployment is to put more money in the pockets of small business owners. This can be done through tax cuts such as by:
- Permanently repealing the Death Tax which keeps business from expanding and growing.
- The government should provide assurance that small business owners aren’t going to be hit with a per-worker health insurance tax.
- The tax on dividends should be abolished so that larger companies can hire with the money they now use to pay higher dividends to shareholders.
- The corporate tax rate of 15 to 38 percent should be lowered to 15 percent across the board so jobs are no longer lost overseas to other countries that have lower corporate tax rates.
Until policies such as these see the light of day, it will be nighttime in America—the unemployed will suffer and their skills deteriorate.