Obama Claims Cap & Trade “a jobs bill”

The president said the bill will spark a “clean energy transformation” of the U.S. economy and “make possible the creation of millions of new jobs.”

“Make no mistake,” he emphasized. “This is a jobs bill.”

So claimed President Obama in an appearance today in the Rose Garden. Technically, the claim is true. If the government funds so-called “clean energy” then yes, lots of clean energy jobs will be created. But where the claim is misleading is that it doesn’t take into account how many jobs will be lost as a result of this bill, nor who will end up paying for all those clean energy jobs (short answer: you and me).

Of course the term “clean energy” means wind and solar. Hydro-electric and nuclear power, although they do not emit any carbon, are still blacklisted because dams kill fish and nuclear power…well, it could have killed some people 30 years ago, but it didn’t, but it was sure scary, plus it would solve a lot of problems, and politicians need problems to justify their power grabs, so we can’t go nuclear and that’s that.

What is beyond dispute is that wind and solar are more expensive than the energy we use today. If it were less expensive, or could even be easily made to be less expensive, then there would be no need for the government to get involved because the market would take care of it. If $50 billion dollars could be invested that would create energy that was clean and cheaper than coal you wouldn’t be able to stop companies from jumping into that business. It would be a gold mine for them. But when nobody is jumping in except when subsidized by the government, what does that tell you?

If clean energy is more expensive than our current energy, how does this produce a net gain in jobs? The answer is that it doesn’t. If something that is provided to the economy suddenly becomes more expensive, that is a drain on the economy, and the result will be a net loss of jobs (all other things being equal), although we would certainly see job growth in the clean energy sector. But where would that money come from for these jobs? Some of it would be diverted from current energy sources. That is, instead of paying an energy company that generates electricity from coal, you would be paying an energy company that gets its energy from wind. The other money would come from federal subsidies, or in other words, from your taxes. In other words, it’s a double-whammy. You would not only see your energy costs go up, but your taxes are going to have to go up (or you’ll have to see services cut) to pay the subsidies to make it feasible to produce that more expensive clean energy.

But it doesn’t stop there. You know that house or apartment you live in? Not only will your power bill be higher, but it took electricity to build that house or apartment. If the cost of building a structure goes up, guess what? That structure becomes more expensive. You know that food you eat? There’s electricity involved in getting that to your dinner table, so you can count on the price of food going up. Electricity is so ingrained in every part of our lives that just about everything will become more expensive as a result of cap and trade legislation.

When things become more expensive, that means we get less for each dollar we earn. Basic economics stipulates that as the cost of an item goes up, the demand for it falls. If the demand for every product and service goes down, then companies will produce less so as to not have excess capacity, and that means they won’t need as many employees, which means we’re going to lose jobs as an economy. It also means that companies will have an added incentive to ship jobs overseas to areas where cap and trade doesn’t exist. Bing–more jobs lost to the United States.

So when Obama says this is a jobs bill, he’s right in only one way–this bill, if passed, is going to cost a lot of people their jobs.