When Conservatives say regulation kills jobs, they are ignoring a pile of research that says otherwise

The Spring 2018 issue of Jewish Currents had my latest “Left is right” article that uses the latest research to show that the left position on environmental issues is the correct one: that the government has a role in addressing climate change and that the best way to do so is with regulation and not market solutions.

There are no current plans to post the article on the Jewish Currents website so I thought I would give you a taste of it in hopes that you will buy the issue to read the whole piece, and maybe even start a subscription. Jewish Currents is a leading left-wing journal of politics and the arts.

Here’s the excerpt:

It is too early to say with 100% ironclad confidence that government intervention can work to address the damage of climate change. But once we accept the premise that it does — as do virtually all governmental and economic experts around the globe except conservatives in the United States —  it is easy to demonstrate that government solution such as regulations and mandates can effectively address a changing climate, while market-based solutions are bound to fail.

The case against government regulation to control and reduce the emissions of greenhouse gases or promote the development and use of alternative energy is built on the myth that every additional government regulation leads to a reduction in jobs and hurts the economy. An overwhelming amount of evidence shows that regulation has little, if any, impact on the number of jobs in the economy in either direction. The best start for reviewing the research on the impact of regulation is Does Regulation Kill Jobs, a collection of 14 articles by a total of 23 leading economic and governmental researchers. In the introductory chapter, the editors conclude that the number of jobs lost through enhanced regulation virtually always will equal the number of jobs gained because of the regulation. They also compare the impact of regulation on jobs in cleaner, less regulated parts of the country with that in dirtier, more regulated areas; these studies indicate relatively few job losses without even taking intoaccount job creation that the regulation produces elsewhere..

As Wayne Gray (Clark University) and Ronald J. Shadbegian (Georgetown University, now at the Environmental Protection Administration) detail in another chapter, the overall effect of pollution abatement on employment is very small: a 10 percent increase in overall abatement costs typically leads to a loss of roughly thirty jobs in industries averaging 40,000 employees. Moreover, they report, the cost to buy, install and maintain pollution-abatement equipment is quite small, measuring about 0.4 percent of all manufacturing shipments (which is far from the entire economy). Coglianese and Carrigan conclude: “The empirical evidence actually provides little reason to expect that U.S. economic woes can be solved by reforming the regulatory process.”

Having failed to prove that regulations remove jobs from the economy — and in fact fully demonstrating that the number of jobs gained through regulation equals the number lost —many economists are now busy trying to quantify the loss in lifetime earnings, self-esteem and other factors that negatively affect those who do lose their jobs.

There can be no doubt that those who lose their jobs because a dirty plant closes down or a toxic material is no longer permitted will suffer, and that there are political costs to that suffering (see: Wisconsin’s, Pennsylvania’s, and Ohio’s swing for Trump in the 2016 election). For every worker who suffers, however, another gains a job in inspection, compliance, or the development and manufacturing of non-polluting technologies. It comes out about even, unless the new jobs pay less, or the newly unemployed receive a lower level of unemployment compensation and other government aid. That’s not a problem with regulation, but reflects critical flaw in America’s advanced free-market economy: a low minimum wage, great inequality in income and wealth, a diminished labor union movement, and the decades-long shredding of the social safety net.

These analyses of jobs lost and gained exclude many substantial benefits of governmental action to address climate change. For that, we can turn to the White House Office of Management and Budget reports to Congress on the benefits and costs of federal regulations.

The agency’s 2016 report, for example, provides a stunning justification for environmental regulation: In the previous ten-year period, thirty-seven EPA regulations produced between $176 billion and $678 billion of benefits (in 2014 dollars) while costing between $43billion and $51billion. That means for every dollar spent on conforming to EPA regulations, the country benefited anywhere from $3.45 to $15.70. Conservatives are ignoring the evidence when they repeat time and time again that environmental regulation hurts the economy and reduces jobs.

opedge

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