Despite absolutely no evidence to support it, conservatives base their entire economic message on the empirically disproven notion that businesses aren’t hiring because of regulatory burdens placed on them by the federal government.
Never mind that businesses themselves report that what they are mainly concerned about is weak sales, not government regulation. Never mind that all of the economic evidence points to a lack of demand for goods and services as the primary culprit behind high unemployment. Never mind that the principal cause of the housing and financial crises was the systematic deregulation of Wall Street. Never mind that ample research proves carefully considered and implemented regulations can actually create jobs and bolster businesses. Never mind all that. Conservatives need a counter-narrative to explain the poor economy, and it has to be one that doesn’t lead directly to passing the American Jobs Act.
The American Jobs Act is designed to help address the underlying economic problem—the significant gap between what our economy is able and willing to produce and what the American people are able and willing to consume. Independent economists estimate that passage of the legislation would result in up to 1.9 million new jobs. The American people, in poll after poll, have endorsed the bill as well. Yet Senate Republicans recently blocked its passage, and the House Republican leadership refuses to even allow a vote on the bill.
So what is the conservative alternative to the American Jobs Act? The same deregulatory agenda they’ve pushed for decades. But even a brief look at some of the actual rules and regulations that conservatives say are “destroying jobs” reveals how bankrupt this argument really is. Five of their favorite targets include:
- Rules governing mercury emissions from power plants
- Rules governing toxic emissions from cement manufacturing
- Safety precautions when working with lead paint
- A ban on the import of illegally harvested, endangered timber
- Restrictions on the importation and transport across state lines of certain species of alien snakes
Yes, conservatives in Congress insist that sensible rules on snakes, endangered trees, lead paint, and dangerously noxious emissions are holding back the U.S. economy and job creation.
In each case, these rules and regulations either impose little or no burden on businesses, or actually help create jobs. And in all cases, the benefits of the rules clearly outweigh any low costs that may exist. So let’s run through the details one by one.
Rules governing the airborne emission of mercury and other toxic chemicals from power plants
In 1990 the bipartisan legislation that amended the Clean Air Act ordered the Environmental Protection Agency to set standards for the emission of mercury, arsenic, and other toxic air pollution from power plants. The health risks of mercury and arsenic are enormously well-documented. In the 21 years since the EPA was ordered to issue these rules, 17 states have independently acted to limit mercury emissions from power plants. Coal-fired power plants alone produce 772 million pounds of airborne toxins every year—2.5 pounds’ worth for every American.
It’s taken 20 years but finally in March the EPA issued a proposed set of rules governing these toxic emissions. The rules are all in preliminary stages and aren’t expected to be finalized for quite some time. Even once the rules are finalized, power plants will have up to four years to comply. The rules are expected to create 31,000 construction jobs installing pollution controls and 9,000 long-term utility jobs.
The EPA also released a report on the costs and benefits of the rules enacted because of the Clean Air Act amendments. The report was congressionally mandated, and the study was subjected to rigorous peer review. The EPA found that the costs of the Clean Air Act amendments totaled $53 billion (in 2006 dollars) in 2010. That’s a significant sum. Yet the estimated value of the benefits of the amendments was much higher, totaling $1.3 trillion in 2010—25 times the cost. And in 2010 alone an estimated 160,000 lives were saved by the rules and regulations mandated by the amendments.
There is a long and storied history of hysteria among conservatives and business groups about “burdensome,” “job-destroying” rules designed to keep our common air free of poisons. As a bipartisan group of legislators joined President George H.W. Bush in authoring the Clean Air Act amendments, the Business Roundtable claimed that the changes would immediately eliminate at least 200,000 jobs—and perhaps as many as 2 million. Responding to industry concerns, lawmakers appropriated $50 million for a retraining fund for workers displaced by the amendments. But by 1994 all of 2,300 displaced workers, all from the coal industry, had applied for aid from the program.
And a 2000 EPA study of coal-mining employment found that only 4,000 jobs lost in the previous decade could be attributed to the Clean Air Act amendments. Moreover, the agency determined that 98 percent of job losses in the coal-mining industry between 1978 and 2010 were related to productivity gains and technological improvements, with just 2 percent resulting from environmental regulation.
A rule limiting toxic emissions from the manufacture of a variety of cement
If you still aren’t convinced that “regulatory uncertainty” is just a conservative canard, consider the sheer amount of time it takes to enact a new rule. The so-called Cement MACT (MACT stands for Maximum Achievable Control Technology) has been in beta for 13 years and is designed to limit emissions from the manufacture of Portland cement, a popular type of cement.
The Cement MACT is aimed at drastically reducing mercury emissions and other particulate matter from cement kilns. Portland cement manufacturing is one of the largest sources of airborne mercury emissions in the United States. The Cement MACT consists of two sets of rules:
- Air toxics standards, which will reduce emissions from both new and existing cement kilns
- New source-performance standards, which will reduce nitrogen oxides, sulfur dioxide, and particulate matter emitted from new cement kilns
These chemical compounds contribute to smog, among other common forms of pollution.
In 2013 there will be about 181 Portland cement kilns operating in about 100 locations around the United States. The air toxics standard will apply to 158 kilns, the new source-performance standards to about seven. The EPA estimates that every $1 spent in compliance with these rules will yield between $7 and $19 in public-health benefits.
Conservatives point to this rule as a job killer at the same time that they block passage of a bill that would spend billions of dollars on highway construction. It isn’t a pending regulation that is causing one-third of cement plants in the country to be shut off every other month—it’s the fact that demand for cement is down 40 percent from where it was before the recession.
A rule to prevent the import of illegally harvested endangered wood
Centenarians don’t often get painted as rabble-rousers but the 100-year-old Lacey Act is now the target of considerable conservative vitriol. That’s because federal marshals raided several Gibson Guitar Corp. facilities in Tennessee in late August—a move that brings back memories of a similar 2009 seizure of allegedly contraband Madagascan ebony from the same guitar maker. The Lacey Act requires that the entire supply chain for endangered wood be legal in all countries involved in its production and sale. The law protects the environment and the rights of other countries to regulate their resources.
Apparently, conservatives think that these restrictions are holding back a tidal wave of new jobs in guitar making. The Lacey Act may now be public enemy number one in conservative circles but it has its own legion of supporters—and they aren’t just tree-hugging hippies. In addition to environmental groups of all stripes, timber industry associations are also on the record in support of the Lacey Act’s wood-sourcing requirements, including the American Forest and Paper Association, the International Wood Products Association, the Hardwood Federation, and the Society of American Foresters. That’s because, before the Lacey Act was amended in 2008 to cover timber as well as animals, research estimated that illegally harvested foreign wood cost the U.S. wood products sector more than $1 billion annually.
Even other guitar makers are on board with the wood-sourcing requirements. Chris Martin, CEO of the C.F. Martin Guitar Company, says of the Lacey Act, “I think it’s a wonderful thing. I think illegal logging is appalling. It should stop. And if this is what it takes unfortunately to stop unscrupulous operators, I’m all for it.”
It’s unclear what conservatives think stopping the enforcement of the Lacey Act will accomplish. A court order on the 2009 raid was just filed this June, and the Justice Department is mum on the developing 2011 case. Meanwhile, Gibson and other guitar makers have continued turning out instruments.
A rule requiring safety precautions when working with lead paint
While the Lacey Act may prompt jokes about tree huggers, surely we can all agree that exposure to lead paint should be monitored, right? Apparently not. Like mercury and arsenic, the toxic qualities of lead are well known, and children under age 6 are most at risk for developing adverse health effects from exposure to lead. Unfortunately, for centuries, lead was used in house paint and plumbing materials. Ingestion of or long-term inhalation exposure to lead can cause behavioral problems, learning disabilities, seizures, and even death.
In 2008, before Barack Obama was elected president, the EPA issued the Renovation, Repair and Painting rule, which requires that contractors working on projects that disturb lead-based paint in pre-1978 homes, child care facilities, and schools complete an eight-hour training course and follow lead-safe work practices. These practices number exactly three:
- Containing the work area
- Minimizing dust
- Cleaning up thoroughly after the project is complete
This isn’t asking a lot of construction contractors.
Yet House Republicans are taking issue with a 2010 revision to the rule that removed the so-called “opt-out” provision, which previously exempted firms from the training and work practice requirements if homeowners signed a waiver. We’ve known that lead is poisonous for a long time, and lead paint has been illegal for indoor use since 1978. So why is the rule just being promulgated now? Because knowledge alone isn’t sufficient to protect children from lead poisoning.
Twenty years ago, nearly one in three children in Baltimore was affected by lead poisoning. In response, the state of Maryland passed a law in 1994 requiring landlords whose property was constructed before 1950 to eliminate damaged lead paint. But 531 children in Maryland last year were still found to have harmful levels of lead in their blood, and 60 percent of those kids lived in newer rental homes or owner-occupied homes not covered by the state law.
Supposedly, the removal of the “opt-out” provision drives the cost of remodeling work up so much that more homeowners are doing the work themselves. Bear in mind that there is no empirical evidence for this position. The only “proof” critics have are comments submitted to the “AmericanJobCreators.com” website, which redirects to a page hosted by House Majority Leader Eric Cantor (R-VA).
A rule governing the interstate transportation of invasive foreign snakes
Scientists estimate that there are more than 100,000 non-native Burmese pythons living in the Florida Everglades. First spotted in the Everglades in 1979, the pythons are believed to be pets that either escaped or were released by their owners. The longest python captured in the Everglades had grown to a gargantuan 17 feet in length. And other invasive foreign snakes, including anacondas and African rock pythons, have joined the pythons in their Floridian paradise, where even alligators must now fear to tread.
The Lacey Act—the same 100-year-old law at issue in the Gibson guitar case—allows for the regulation of non-native species. As anyone who has ever heard of kudzu or the Asian carp can tell you, non-native plants and animals can be enormously harmful to American species. The three-foot-tall wood stork didn’t evolve alongside leviathan carnivorous snakes, which is why the Burmese pythons in the Everglades have been eating them, along with many other native birds.
In 2010 the Fish and Wildlife Service proposed a rule limiting the interstate transport of nine foreign snake species, including the Burmese python. Millions of dollars have already been spent by state and federal agencies to address the pythons in the Everglades, and, according to the Fish and Wildlife Service, “If the spread of these species is not controlled, we anticipate that … agencies would need to spend even more money to address the threats posed in other areas of the United States.”
But according to House Republicans these snakes are among America’s great job creators. As evidence for this position, a report from the House Oversight and Government Reform committee cites the experience of a small business owner who breeds snakes in Utah, who has laid off four of his seven employees since 2008.
Of course 2008 was the height of the Great Recession, and rampant layoffs and diminishing home equity values do have a way of making people cut back on unnecessary spending—like buying exotic snakes. And the rule wasn’t even proposed until 2010, making it difficult to imagine that the Utah businessman started cutting payroll two years early. But why let a timeline get in the way of a good talking point?
Talking-point economics
Conservatives in Congress are in a bind. If they admit that all the evidence points to a serious demand gap in the economy, then they’ll be forced to accept that proposals such as the American Jobs Act are much-needed medicine for what ails us. But if they do that, they’ll have to support legislation that their political opponents have introduced. So to get out of this dilemma, conservatives have to come up with an alternative (reality) explanation for the flagging economy.
With no proof, no numbers, and no research to back them up, they’ve called out several proposed and existing regulations as monstrous “job destroyers.” But the facts just aren’t on their side. The regulations they claim are hurting the economy are doing no such thing. Instead, they are all intended to protect the public from very real dangers, and the costs associated with them.
Now, just because conservatives picked a bunch of examples that clearly do not fit their narrative doesn’t mean that all regulations necessarily meet the cost-benefit test. That’s precisely why the Obama administration has undertaken a thorough review of federal regulations, and has already identified hundreds to be reformed or thrown out altogether. That’s important progress that should be continued. But no matter how many regulations are streamlined or updated, reformed or scrapped, it won’t solve the real economic problems facing the country.
That’s an unfortunate fact for conservatives in Congress who are looking for ways to blame the Obama administration for high unemployment. But it has the virtue of being true.
Michael Linden is Director of Tax and Budget Policy at the Center for American Progress. Kristina Costa is a Special Assistant with the Doing What Works project run by the Economic Policy team at the Center.