‘This is going to cost us jobs at a time when jobs are more scarce than ever,’ says Short
Rep. Shelly Short, R-Addy, today announced her opposition to upcoming "cap and trade" legislation, which she says will hurt families, eliminate jobs and devastate our state’s economy.
"While I think we can all agree that our environment is important and certainly something to be protected, the fact is, Washington state accounts for only three-tenths of one percent of global greenhouse gas emissions," Short said. "Our state is very clean. We have clean, abundant hydropower and some of the most aggressive conservation policies in the nation. We shouldn’t be risking our state economy and jobs for an unproven cap and trade policy that burdens businesses and discourages out-of-state companies from bringing their jobs here.
"Furthermore, this is the wrong time to implement punitive and costly environmental policies on our employers," Short continued. "Last week, Boeing announced nearly 5,000 employees would lose their jobs. This week, it’s Microsoft announcing up to 5,000 people would be laid off. Our state’s unemployment rate continues to go up and is at its highest point since 2003. We should be doing everything we can to help employers create and retain jobs, not placing more obstacles in their way. This is going to cost us jobs at a time when jobs are more scarce than ever."
The so-called cap and trade legislation is a proposal put forth by the Western Climate Initiative, which includes seven Western states and four Canadian Provinces. The idea is to cap the amount of carbon that may be emitted by activities such as energy and oil production, manufacturing jobs, and, by 2015, auto emissions, in order to reach 1990 emission levels by 2020.
Businesses will have to purchase "allowances" from the government for the right to emit greenhouse gasses. The government will limit the number of allowances available and continue to reduce that number every three years until the 1990 emission levels are reached.
If companies don’t have enough allowances to cover their emissions, they will have to pay a fine up to $10,000 per day. And, if a company doesn’t use all of its emission allowances, it may sell those credits to other companies who need them.
While this might seem relatively harmless at first glance, Short said the extra costs to businesses that have very limited options to either pay penalties, buy credits from other entities, reduce production, or close their doors altogether will have a disastrous effect on the state’s economy.
"Companies are being told they’ll have to invest in new technologies that, frankly, don’t exist at this point," Short said. "What are the costs associated with developing and paying for new technologies to reduce emissions? What works for one sector, such as manufacturing, may not work for another sector, such as lumber and paper mills.
"Where is this money going to come from? Consumers – consumers in our state are going to see prices for goods and services go up," Short continued. "And what about competition with other states and nations? Washington’s economy relies heavily on exporting manufactured goods and agricultural commodities. Will our competitors be subject to similar regulations? Or, are we going to be priced right out of business at every turn?"
Short said the cap and trade proposal also creates a scenario where Washington companies would be competing for survival against Wall Street firms with huge resources.
"The ‘trade’ part of cap and trade relies upon one company, which might be able to implement policies or technology to reduce emissions, selling their extra emission credits to those companies that are unable to meet the stringent requirements," Short said. "As far as we can tell, there’s nothing to prevent an investment firm from buying up excess allowances from businesses in our state and then selling them to businesses in other states, like California or Oregon. Washington companies could be facing an insurmountable dilemma of needing more emission credits, but not being able to compete with the resources available to big-time players on Wall Street.
"We could lose even more jobs in our state because additional emissions credits would all be sold to out-of-state companies," Short said.
Short also expressed concern for the possibility of rampant greed and corruption throughout the secondary market that will buy and sell the excess emissions credits.
"Once a free market is set up to trade allowances, the market becomes interstate commerce and will be controlled by the federal government," Short said. "Washington cannot control the fraud, speculation and greed that will drive this market like we saw with Enron and the sub-prime lending market."
The governor is expected to propose her cap and trade legislation, dubbed the Climate Action Plan, soon.
Short is urging her constituents to call the Legislative hotline at 1-800-562-6000 to let the governor know that Washington families cannot afford her cap and trade program.
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