Jeff Swensen/Getty Images Alcoa lobbies for green government policies here that boost demand for itsÊlight metal, but fights them Down Under where it produces aluminum.
Democrats based much of their 2010 midterm congressional election campaign on the risible claim that Republican candidates wanted to "outsource jobs." Set aside the fact that this claim, repeated in literally hundreds of races, was as ineffective as it was ludicrous. More importantly, President Obama's new carbon control scheme, which begins next week, provides conclusive evidence that it was the Democrats who planned to do the outsourcing.
Carbon limitation laws will send American manufacturing jobs overseas. Carbon emissions, unlike pollutants regulated under the Clean Air Act, can only be reduced significantly through reductions in output, which necessarily means the loss of jobs, increases in prices, or both. As Obama's carbon limitation program begins next week, with new regulations coming into effect over the next two years, energy-intensive industries will begin weighing the costs and benefits of relocating manufacturing operations to countries -- think China and India -- whose governments do not significantly regulate carbon emissions. This is the last idea we should be raising in corporate boardrooms at a time of 9.8 percent unemployment, but it is apparently a higher priority for Obama than preserving American jobs.
Reuters reported last week that Obama has secured limited industry cooperation to propose his new regulations. He can be counted on to use whatever cooperation he gets as a public relations tool to blunt criticism, just as he did in the health care debate. For although industry resists to a point, it has ways of dealing with the increased costs -- sometimes even of profiting from them -- that are inaccessible to most Americans. For example, AES Corp., an energy company that lobbies for carbon regulation to protect its domestic investments in "green energy," simultaneously builds new coal- and diesel-fired power plants in Chile, Vietnam and India. Alcoa, the aluminum maker, lobbies for costly green policies here in America to boost the use of its light metal, but lobbies against them in Australia, where it actually makes aluminum.
Expect such corporate schemes, of which examples already abound, to become even more common once the Environmental Protection Agency caps carbon emissions. We fully expect that politically clever operators with sufficient resources -- the people with whom Obama is cutting unlegislated deals, as he did with the pharmaceutical industry -- will ultimately be compensated for increased regulation by collecting "green" subsidies at this end of the world while spewing more carbon at the other. And as with Obama's health care reform, American taxpayers and consumers will pay for the result through higher prices and the further weakening of American workers' competitiveness.
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