Guest OpEd: Obama Regulations are Killing U.S. Jobs by John E. Peterson

President Obama’s hostile attack on oil production and refining is accomplishing its defined goal of making oil more expensive so his green energy allies can compete.  And while it is a cold, hard fact that wind and solar energy will not replace a single barrel of oil in our transportation system, Obama’s policies are leading to skyrocketing prices at the pump and unaffordable heating costs for millions of Americans.  Nowhere is this more evident than here in the Northeast, where nearly eight million Americans still heat their homes with oil.

And by the time we’re ready to put the dark days of winter behind us and move into spring, thousands of workers in Eastern Pennsylvania will be heading into their own dark days as they face an uncertain economic future. Since the end of 2010, three oil refineries in the Philadelphia area have closed or face closure. Union officials have predicted the loss of more than 2,000 direct jobs and up to 20,000 indirect jobs that were supported by these refineries.

Those same union officials have been very active over the past few months lobbying federal officials in Washington to keep the refineries open. I commend them on their attempts – although late – to save the individuals and communities that stand to lose everything.

In addition to union activity, several liberal Members of Congress have expressed concern over the potential for refinery closures. Recently, my former colleagues Representatives Markey (D-MA), Waxman (D-CA) and Brady (D-PA) all derided refining companies for putting “profits over people.” This statement came in response to an Energy Information Administration analysis indicating the recent refinery closures could lead to price spikes and home heating oil shortages in the northeast, some in Congress are starting to get concerned about energy costs to American consumers.

If union members and some liberal Democrats are as concerned about energy supplies as their recent statements indicate, why did they support all-cost, no-benefit EPA regulations that have contributed to the closures in the first place?  Additionally, why did they oppose legislation that would have helped keep refineries open and support bills that make the plight of American refining worse?

According to a Department of Energy report issued in 2011, the compounded burden of federal regulations was a significant factor in the closure of 66 petroleum refineries in the U.S. over the past 20 years. Since 2008, the recession and refinery closures have led to 3,000 lost jobs at American refineries prior to the announcement of the northeast refinery closures. Now the employees of those refineries will be added to those devastating numbers.

Congress has considered legislation this year that would have at least taken a step to stop the bleeding. Unfortunately, neither the unions nor my previously mentioned former colleagues supported these initiatives.  Specifically, these bills include:

The Energy Tax Prevention Act, which would have stopped EPA’s greenhouse gas regulations that the Agency itself has admitted will do absolutely nothing to reduce global GHG concentrations, and that Congressional hearings revealed are already costing refining and manufacturing jobs. Waxman, Markey and Brady all opposed this measure.

The McConnell Amendment, the Senate companion to the Energy Tax Prevention Act, would have taken similar steps toward saving refinery jobs.  For the record here in Pennsylvania, Senator Toomey supported the amendment and Senator Casey opposed it.

The TRAIN Act and the Kinzinger-Gonzalez Tier III Amendment were measures that would have simply required a realistic economic and jobs analysis of the blizzard of regulations facing refineries and other American industrial businesses. The amendment would have applied such analysis on a new EPA gasoline regulation that will have almost no environmental benefit, but which studies indicate could lead to an additional 4 to 7 refinery closures. Once again, Waxman, Markey, and Brady all opposed these measures.

Sadly, the trend of overregulation and congressional hostility to traditional energy sources will inevitably result in more jobs moving overseas to foreign competitors not strangled by our country’s regime of burdensome environmental and business regulations.  And that’s on top of the basic energy cost increase that will continue to hit American consumers who must endure the consequences of refinery closures like those in Pennsylvania.  In fact, the three recent closures account for nearly half of the Northeast’s total refining capacity.

Anyone interested in the best interests of American consumers, the survival of U.S. manufacturers, and the preservation of refinery jobs should oppose today’s overregulation. This would be the most effective action to keep down home heating oil and fuel costs, prevent refinery closures, and to stop our jobs from going overseas.

Related posts:

1. NFIB Requesting Sensible Regulations
2. Prevailing Wage Reform Possible in 2012

Concerned Pennsylvanians are well aware that PennDOT is facing a multibillion dollar shortfall. Whether it is the state’s several thousand structurally deficient bridges or the more than occasional potholes, state rankings continually cite the Commonwealth amongst those having the worst roads in the nation. Democrats proclaim that PennDOT’s dilemma stems from a lack of revenues are therefore advocating for increased fees and gasoline taxes. However, the facts reveal that the Keystone state is amongst the highest in the nation when studying spending per road miles and gasoline taxes. There are solutions to the transportation crisis that will more efficiently allocate transportation dollars. One such proposal is prevailing wage law reform.

CF President Matt Brouillette explains that the origin of prevailing wage laws dates back to the 1930s. It was an effective measure designed to keep construction wages high in order to protect white workers from competitively cheap black labor. While many states have repealed their prevailing wage laws, Pennsylvania continues this practice which is responsible for increased labor costs of more than 30 percent. The annual price tag for prevailing wage is approximately $1 billion. The increased costs associated with prevailing wage negatively impact state transportation funding, local government and school board budgets.

Towards the end of 2011, Rep. John Bear and his colleagues on the Labor and Industry committee introduced several bills to reform Pennsylvania’s costly and antiquated prevailing wage. The GOP lawmakers believe that the new legislation will free up funding for additional public projects and more efficiently use taxpayer money. To date, the package of reforms has yet to reach the governor’s desk. As legislative attention is becoming increasingly focused on transportation issues, it is quite possible that after 50 years, the prevailing wage may finally be amended in 2012.

PA Independent’s recent story on the resurgence of the prevailing wage debate was met with opposition from PA AFL-CIO President Rick Bloomingdale. He claims that the proposed changes in prevailing wages will negatively impact union construction laborers by reducing wages and ultimately will affect the communities in which they live. While Bloomingdale’s claims have merit, he does not address the consequences or burden that the increased taxes required to fund the salaries of construction workers will have on the majority of Pennsylvanians. While many citizens are losing jobs or being forced to accept pay cuts, the prevailing wage law guarantees construction worker’s salaries of 20% to 30% above that of comparable jobs in the private sector.

Reforming or eliminating Pennsylvania’s costly prevailing wage laws are an important start in addressing PennDOT’s funding gap and spending problem. Prevailing wage laws are proving to be too costly and are adversely affecting the ability to repair the state’s infrastructure. The laws are out of touch with the majority of Pennsylvanians who have experienced large pay cuts and loss of employment. At a time when families are struggling to make ends meet, taxpayers can simply not afford to support artificially high wages associated with the public sector labor union. Moving in the direction of competitive private wages will free up the resources needed for more projects and additional hires in construction throughout Pennsylvania.

Jonathan Humma of Lancaster County is an American University economics student and blogs at http://keystoneliberty.org

Related posts:

1. Sen. Toomey responds to State of the Union address 2012
2. Democrats Condemn 2011 as “GOP Failure”
3. PennDOT Must Reform Spending Before Revenues

As a follow up to a year-end press release which summarized 2011 as a “GOP Failure”, House Democrats continue to criticize Gov. Corbett and the GOP for failed leadership. This time, Democrats announced their initiative to take the lead in Pennsylvania’s transportation and infrastructure crisis. The Governor’s transportation advisory committee reported back with their findings in August 2011. As Republicans have put Pennsylvania’s infrastructure needs on the back burner of the legislative agenda, the Democrats are rightfully placing increased emphasis on transportation. However, their leadership fails to appropriately address the Keystone state’s growing infrastructure demands.

Both Democrats and the transportation advisory committee conclude that the Pennsylvania Department of Transportation is faced with a multibillion dollar budget gap. They claim that the correlation between increased fuel efficiency standards which result in decreased fuel tax revenues to be at the forefront of a revenue problem. Another facet of blame for a widening budget gap is inflation and increasing Pennsylvania State Police costs. According to the advisory commitee’s projections, PennDOT will face more than a $7 billion funding gap by 2020. This will further deprive the state of sorely needed construction and reparation projects.

While Democrats and the advisory committee should be commended for reviewing tens of millions of dollars in savings through modernization and efficiency, the overwhelming majority of their proposals include raising billions of dollars in increased fees and higher gasoline taxes. Another controversial move by Democrats is to utilize turnpike revenue to fund mass transit. This move is in opposition to a user-fee policy. Turnpike motorists will be paying for a form of transportation they choose to avoid. The Democratic plan for PennDOT is business as usual in Harrisburg as politicians choose to raise revenues and leave important reforms off the table.

In order to truly confront the infrastructure crisis in Pennsylvania, lawmakers must recognize the core of the problem is overspending;  not lack of revenues. The Commonwealth’s spending per road mile is ranked higher than nearly all other states. Additionally, gasoline taxes are amongst the highest in the nation. Pennsylvanians deserve more for the current funding. This can only be achieved through fundamental reforms. There are a plethora of policy options from which to choose that will give Pennsylvanians more for their tax dollars. These policies include the end of pork barrel transportation projects, reforming or eliminating prevailing wage laws, and enabling public-private partnerships for the Pennsylvania Turnpike and mass transit. Implementing such reforms will free up the necessary resources to rebuild Pennsylvania’s deteriorating infrastructure.

Pennsylvania’s widening transportation funding gap merits the attention of all lawmakers. For a proper solution it must be recognized that the dismal state of affairs is the result of a spending problem, not revenues. The status-quo is no longer acceptable as there are several ways to make real positive changes that will create more jobs through more construction projects with the same level of funding. Pennsylvania must invest wisely and be an efficient steward of taxpayer money as a practice of good governance while paving the roadways towards the future.

Jonathan Humma is an economics student at American University and a blogger at http://keystoneliberty.org

Related posts:

1. Democrats Condemn 2011 as “GOP Failure”
2. Prevailing Wage Reform Possible in 2012

Despite a very heated race for US Senate in 2012 in Pennsylvania, and despite what appeared to be an imminent open primary, Steve Welch (WelchForPA.com) has taken the PA State Republican Committee endorsement. In a vote that appeared to be much closer from the outside, Welch won on the first ballot cast by simple majority. No small feat when you consider that there were 5 candidates vying for the endorsement. The Welch campaign had been gaining momentum with many endorsements from countywide officials over the last few weeks/months. However, an endorsement by Gov. Tom Corbett Friday launched Welch to the top.

However, at a time when we should be united towards one agenda, defeating Bob Casey- Barack Obama lite, 4 candidates had already made clear their intentions of running despite the State Committee endorsement. This will continue to be a race to watch very closely.

For now, the Welch campaign can and should celebrate their huge victory today!

For Steve Welch’s full remarks to the State Committee after the endorsement: Click Here.

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1. David Freed Steps Up, Will He Get Knocked Down?

Before adjourning for Christmas recess, Democratic leaders issued a press release lambasting Gov. Corbett and the Republican legislature for their “extreme ideological crusade” and “no leadership on jobs.” The scathing critique included overtones of commonplace class warfare rhetoric accusing Republicans of attacking workers’ rights and the middle-class. Representative Dermody, D-Allegheny, went as far as saying that Republicans made Pennsylvania’s job climate worse coupled with failures in transportation and Marcellus Shale tax policy.

Despite Democratic claims, Republicans accomplished several achievements for Pennsylvania’s job climate. The Corbett budget reduced spending and did not raise taxes. The Corbett administration no longer had federal stimulus funds and made substantial cuts. An end to the state’s runaway government spending brought tax stability for job creators and Pennsylvanians. In order to successfully curb Pennsylvania’s onerous tax burden, Republicans passed legislation to reduce loopholes in school district property tax hikes without voter referendum. Republicans refrained from imposing large Marcellus Shale taxes which will keep the industry booming. According to Democratic philosophy, taking action on jobs equates to more government spending. In stark contrast, Republicans are trying to keep spending and taxes low so that the private sector can prosper.

Senator Hughes, D-Philadelphia, asserts that budget cuts are “reverse investments at a time when we should be investing more in our roads, bridges, mass transit, and our workers.” Governor Corbett’s transportation report in August agreed that the state of Pennsylvania’s infrastructure is deteriorating. Third party state rankings report that Pennsylvania’s roadways and bridges are amongst the worst in the nation despite being at the top of the leader board in roadway spending per mile. Additionally, fuel taxes, which fund the roadways, are amongst the highest in the nation. Instead of raising fuel taxes which increase the burden for Pennsylvanians at the pump, there must be reforms dedicated toward getting more value for the current funding. Senate Republicans passed SB 344 which established more public-private partnerships in transportation. More efficient infrastructure spending means more projects, more jobs, and better roadways.

Lastly, state Democrats protested against the Republican’s impact fee on Marcellus Shale natural gas drilling. Democratic leaders contend that the tax on drilling companies is not high enough for companies to “pay their fair share.” Democratic legislators criticize Pennsylvania for having the lowest tax on natural gas drillers in the nation. For many Democrats, the economic boom associated with the natural gas industry equates to more revenue for government spending. Republicans must proactively highlight the billions of dollars in capital investments, royalties given to local landowners, and taxes generated from the industry. The industry is successfully providing jobs and cheap energy to Pennsylvanians. Taxing the industry will ultimately reduce its investment and growth potential, and impose higher energy costs on already struggling consumers.

Democrats continue to lash out at GOP leadership in an effort to score political points and defer blame of the stagnant, faltering economy. Republicans must keep focused and press forward to reduce the growth of government, provide tax relief, and create a business friendly climate for job creation.

Jonathan Humma blogs at http://keystoneliberty.org

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2. David Freed Steps Up, Will He Get Knocked Down?
3. PennDOT Must Reform Spending Before Revenues