WashACE Blog

Good Reasons Not to Raise the Hazardous Substance Tax

Don't miss this op-ed in the Herald of Everett by Don Sorensen on the Hazardous Substance Tax. We've written previously on it (see here and here). Sorensen writes:

First, increasing the tax will increase the price Washington consumers pay for gas and diesel at the pump. This will hit low-income families, already struggling with the recession, extra hard. These increases will also hit many other businesses, from truckers to farmers to retailers...

Second, increasing the tax puts good, family-wage jobs at risk. Proponents are touting the new jobs that could be created by the tax...But they conveniently fail to talk about the existing good jobs threatened by this major tax increase. The Tesoro Anacortes refinery that I manage is a prime example. These are tough times for the refining industry and our continued viability would be put at risk by this massive tax increase.

Read the op-ed. This potential tax increase has long-term negative consequences for families and businesses in the state.

Environmental and Labor Agendas Reported This Morning

Unsurprisingly, they both think higher taxes are necessary.

In The News Tribune, John Dodge writes of a modest environmental agenda that doesn't look all that modest to me.

Once again, the state environmental coalition of 25 nonprofit groups will push a bill to impose a fee on petroleum products that contribute to stormwater pollution, which is the number one urban pollution problem in Puget Sound, said Dave Peeler, director of programs for People for Puget Sound.

That's a huge cost passed on to consumers and diverting gas tax dollars - calling it a "fee on petroleum products" doesn't change it's character - from highway construction. A bad idea in good times, it's a terrible idea now.

And the Washington State Labor Council released its 2010 agenda, not bothering to pretend that the WSLC ambitions are at all modest. While claiming to be "focused on jobs, jobs, jobs," it's mostly old wine in old bottles.

Some snippets drawn from the agenda, which I urge you to read in full. (BTW, they also like the "petroleum fee.")

    •    Opposing the deregulation of public services, including state liquor stores.
    •    Extending collective bargaining rights to teachers, musicians, interpreters, and child care workers, allowing them a voice in decisions in the workplace.
    •    Codifying rest and meal breaks, protecting the health and safety of workers.
    •    Filling the Washington’s state budget gap by closing tax loopholes and raising revenue, thus protecting critical services and institutions as well as 23,000 state employee jobs and an additional 14,000 private sector jobs.
    •    Repealing I-960 to allow legislators the opportunity to do the jobs they were elected to do: making decisions on how we finance state services and employment.
    •    Paying prevailing wages on all public-private partnership projects and federally funded projects, ensuring our tax dollars create quality jobs that create quality results.
    •    Requiring all corporations that receive state tax breaks to pledge that they are committed to creating jobs and economic prosperity in Washington state.
    •    Capturing $98 million in federal Unemployment Insurance modernization funds by extending unemployment eligibility to part-time workers and to workers facing undue hardship; extending 2009 U.I. stimulus package through 2010 ($45 weekly benefits and higher minimum benefits).
    •    Protecting vulnerable injured workers against unfounded attacks on the workers’ compensation system. 


Labor's "jobs agenda," then, focuses on making it easier to increase taxes, expanding UI benefits, opposing contracting out, battling workers' compensation reforms, pushing for more collective bargaining and workplace regulation, preserving the status quo for state workers and boosting employer costs.

How would an agenda focused on job destruction differ?

Economy Over Climate Change, 85-12

That's the finding of a USA Today/Gallup poll reported in SeattlePI.com.

Which do you think should be a higher priority for the Obama administration right now?

85% Improving the economy
12% Reducing global warming

At Publicola, Josh Feit consider the implications of the survey for the legislative session.

So far, the left’s agenda in Olympia this year seems more blue than green. When a supergroup coalition of lefties (dubbing itself Rebuilding Our Economic Future) showed up in Olympia last week to protest the budget, no environmental groups took the stage with the union members, health care advocates, education leaders, and financial aid students.

<snip>.

[Coalition spokesman Sandeep] Kaushik tells me that was an accident and the environmental community is part of the coalition that’s working out a platform and message on the budget.

I’m sure they are. But I do wonder if the issue that seemed to be the zeitgeist during the last half of this decade has suddenly been displaced in our state.

It wouldn't be the first time that fiscal reality forced a change in strategy and priorities. The public gets it.

More on the CRU Climate Scandal

Here's my column on the scandal spreading from the Climate Research Unit at the University of East Anglia (England).

Events continue to unfold. On the Commentary blog, John Steele Gordon notes that Phil Jones, the CRU director, has stepped down pending an investigation, according to AP. And Michael Mann, he of the wobbly hockey stick, is under investigation at Penn State.

A geeky, but interesting, discussion on the software & IT issues at Dude, with Keyboard. (h/t Instapundit)

And, in Australia, as today's Wall Street Journal reports, proposed cap-and-trade legislation sparks a parliamentary revolt. 

Interesting times.

Change in Business Climate Needed

Don Brunell's Columbian column highlights an issue deserving much more attention: lawsuits filed over climate change.

Global warming is about to create an avalanche of lawsuits against the federal government and private industry.

He gives a number of frightening examples. Then this:

Congress is wading in as well. The 1,427-page energy bill passed by the House of Representatives gives enforcement powers over greenhouse gas emissions to "… citizens, states, Indian tribes and all levels of government."

Simply put, that means everybody can sue everybody.

His conclusion:

Ironically, all this litigation could end up harming the environment rather than helping it. Rather than face a future of endless litigation, companies that employ millions of Americans will simply move to countries with less stringent environmental regulations — and jobs will go with them.

If we are to have any chance of putting millions of Americans back to work, we need climate change all right. We need to change the business climate in this country to encourage, rather than discourage, employers to do business here.

Precisely right.

A Sampling of Writing on the Climate Change Scandal

I spent part of the holiday weekend working on a column on what some folks are calling Climategate, the release of thousands of emails and other documents revealing a pattern of bad behavior at the Climate Research Unit at the University of East Anglia, England. (Having taken a vow to resist the "gate" suffix for political mischief and misdeeds, I'll just call it the climate change scandal.) As the holiday weekend wore on, the commentary and analysis piled up, along with great links to the leaked information.

The coverage in local papers has been limited, so I thought I'd put some of the best of what I'd read up here.

In the Wall Street Journal, Kim Strassel writes that the scandal has sunk any remaining prospects for Senate passage of a cap-and-trade bill.

One of the best headlines appears over a good WSJ editorial: Rigging a 'Climate' Consensus

Megan McCardle's Atlantic article points up the real problem with the climate science emails. She cites a perceptive assessment by CBS news reporter Declan McCullagh, widely viewed as having done the best MSM reporting on the scandal. This is from McCardle's post:

The emails seem to describe a model which frequently breaks, and being constantly "tweaked" with manual interventions of dubious quality in order to make them fit the historical data.  These stories suggest that the model, and the past manual interventions, are so poorly documented that CRU cannot now replicate its own past findings.

That is a big problem.  The IPCC report, which is the most widely relied upon in policy circles, uses this model to estimate the costs of global warming.  If those costs are unreliable, then any cost-benefit analysis is totally worthless.

The IPCC report she refers to is the United Nations Intergovernmental Panel on Climate Change assessments. As McCullagh writes:

That report, in turn, is what the Environmental Protection Agency acknowledged it "relies on most heavily" when concluding that carbon dioxide emissions endanger public health and should be regulated.

Then we discover that the raw data has been dumped, making replication impossible.

What's it all mean? IChristopher Brooker, in an op-ed for the Daily Telegraph, calls it "the greatest scientific scandal of our age," with science taking a back seat to ideology.

What is tragically evident from the Harry Read Me file is the picture it gives of the CRU scientists hopelessly at sea with the complex computer programmes they had devised to contort their data in the approved direction, more than once expressing their own desperation at how difficult it was to get the desired results.

Michael Barone frames the question appropriately.

The more interesting question going forward is whether European and American governmental, academic and corporate elites, having embraced global warming alarmism with religious fervor, will be shaken by the scandalous CRU e-mails. They should be.

My column is scheduled to run Wednesday.

McDermott's Effort To Breach Snake River Dams Threatens Jobs, Economy

Once again, Rep. Jim McDermott, D- Seattle, has called on Congress to remove four Snake River dams. Here's how Les Blumenthal frames its prospects for McClatchy.

... for the fifth time, the Seattle lawmaker has introduced legislation that likely will go nowhere, put his Democratic colleagues from Washington in an awkward position and sharpen the focus on Snake River dam breaching just as the Obama administration prepares its salmon-recovery plan.

I like that "go nowhere" part. AWB president Don Brunell explains the consequences in his weekly column. 

Without the dams, thousands of jobs would evaporate and an important food producing region would dry up, along with state and local government revenues. Power bills would jump again with the loss of additional hydropower facilities, which supply 70 percent of our state's electricity.

Thankfully, Gov. Chris Gregoire opposes McDermott's effort to remove the dams. She realizes that without the Snake River reservoirs, the region would become an arid wasteland.

What a strange distraction as the region continues to struggle with job creation and investment.

This and That: I-1033, Hydro in I-937, Great Health Care Videos, and More

I spent most of the last two days at a meeting of the Western States Petroleum Association, a good WashACE supporter. Here's a bit of catching up on things we've posted on previously...and some new stuff.

New:

• In this Puget Sound Business Journal Column I take a look at Initiative 1033, a revenue cap that promises property tax relief. Read it and let me know what you think. 
• There's a lot of talk about taxing the rich to pay for new federal programs. That makes this new Tax Foundation report particularly timely. 

The top 1 percent of tax filers earned about 22.8 percent of the nation's income in 2007 (the latest IRS data available), and paid 40.4 percent of all federal income taxes - more than the bottom 95 percent of tax filers combined, according to a Tax Foundation analysis of just-released IRS data.

Ongoing:

• It looks like health care reform may be slowing down in Congress. That's a good thing. The News Tribune editorial board points out this morning that good health care law won't expire like milk. This post from The Heritage Foundation should erasie any lingering doubt about the importance of taking the time to get it right. 
• Worth a special health care bullet is this excellent video series from the Washington Policy Center. The WPC managed to break down the complexities, bring out important information, and do it in a compelling and concise manner. Great work.
• In an earlier post on the challenges facing renewable energy, I linked to a seattlepi.com story citing Speaker Frank Chopp's support of including hydro as a renewable under the definitions of I-937. In a sharp editorial today, "We're not Las Vegas - say it here, be heard there," the Tri-Cities Herald challenges the Speaker's attempt to distance himself from the remark.
• The Seattle-Charleston connection, something I wrote about here, gets a nice treatment in this Puget Sound Business Journal post. The two metros have more in common that you think.

So Little for Cap and Trade

With environmental benefits so negligible, "so much for cap and trade" just doesn't sound right. As the Heritage Foundation reports this morning, even the director of the Environmental Protection Agency acknowledges that the Waxman-Markey cap and trade legislation won't make much difference to global climate change.

[Sen. James] Inhofe produced an EPA chart generated last year during the Senate’s debate of the Lieberman-Warner cap-and-trade legislation. The chart showed that the carbon reductions under that bill would not materially effect global carbon concentrations in the atmosphere. Inhofe then asked Jackson if she agreed with the chart’s conclusions. [EPA Administrator Lisa ] Jackson replied: “I believe that essential parts of the chart are that the U.S. action alone will not impact CO2 levels.”

As Heritage continues, Energy Secretary Steven Chu said he did not agree with the chart. Still, most agree that a go-it-alone approach by the US won't work. It'll just accelerate the outsourcing of American jobs to those places not subject to similar regulatory constraints. Read the brief Heritage post.

Washington business groups have steadfastly championed market-based approaches to environmental protection - approaches that rely more on incentives than arbitrary regulatory caps. See, for example, this Olympia Business Watch post and this column by AWB president Don Brunell. In the column, Brunell notes that many businesses are quick to respond to new technology and try to incorporate it in their operations, capitalizing on efficiencies and reducing emissions. Yet, often, the very groups that promote renewable energy stand in the way of private sector innovation.

The latest example is just outside the Columbia River Gorge near Bingen. The SDS Lumber Co. wants to erect 50 wind turbines on a gusty ridge outside the Columbia River Gorge National Scenic Area. The company would convert its land to a wind farm and possibly add another 30 turbines on land leased from the state.

Even though there are no buffer zones around the Columbia River Gorge National Scenic Area, Forest Service Scenic Area General Manager Don Harkenrider wants any turbines visible from within the scenic area eliminated. There goes most of the project.

So, while we support renewable energy in theory, we block its development. Similarly, while we say we want cleaner fossil fuel technology, we make it impossible to develop.

Meanwhile, the rest of the world balks at new regulatory standards. We should, too.

Cap and Tax Squeaks Through House ... More Squeaks Expected

Yesterday the U.S. House narrowly passed the massive Waxman-Markey climate change (cap and tax) bill, 219-212. Forty-four Democrats voted against it; eight Republicans, including Rep. Dave Reichert, R-Auburn, voted for it. The Seattle Times has statements from members of Washington's Congressional delegation.)

The Washington Post, finding a silver lining in the GOP crossovers, writes,

...a small number but a better show of GOP support than Obama received on key items such as the $787 billion stimulus bill and a $106 billion war-funding bill.

The strongest display of bipartisanship appears to have been on the opposing side.
One House GOP staffer says the bill's dead in the Senate. (I'd have said it's toast, but that invokes an unpleasant global warming image.

Given the close margin and the likely tough-sledding in the Senate, it's timely to recall why this is bad legislation. ShopFloor, the blog of the National Association of Manufacturers, draws on Heritage Foundation research to demonstrate the job losses likely to ensue. 

Economists in The Heritage Foundation’s Center for Data Analysis estimate that manufacturing jobs will fall on average by 400,000. Peak year unemployment in the manufacturing sector alone rises by almost 1.4 million.

Investor's Business Daily calls the bill a man-made disaster, pointing out the sweeping negative effects on virtually every sector of the economy.

Consumers would pay through the nose as electricity rates would necessarily skyrocket, as President Obama once put it, by 90% adjusted for inflation. Inflation-adjusted gasoline prices would rise 74%, residential natural gas prices by 55% and the average family's annual energy bill by $1,500.

In the Wall Street Journal, Kimberley Strassel examines the weakeing case for climate change regulation, noting that the global warming tide has again shifted. 

The number of skeptics, far from shrinking, is swelling. Oklahoma Sen. Jim Inhofe now counts more than 700 scientists who disagree with the U.N. -- 13 times the number who authored the U.N.'s 2007 climate summary for policymakers. Joanne Simpson, the world's first woman to receive a Ph.D. in meteorology, expressed relief upon her retirement last year that she was finally free to speak "frankly" of her nonbelief. Dr. Kiminori Itoh, a Japanese environmental physical chemist who contributed to a U.N. climate report, dubs man-made warming "the worst scientific scandal in history." Norway's Ivar Giaever, Nobel Prize winner for physics, decries it as the "new religion." A group of 54 noted physicists, led by Princeton's Will Happer, is demanding the American Physical Society revise its position that the science is settled.

Today's Seattle Times carries an AP story quoting the president as urging swift passage in the Senate. 

There's no hurry. Senators should take their time. The economic consequences are substantial; the environmental benefits, minimal.