Like it or not we live in a global economy. If the Obama administration enacts policies that make it too expensive to manufacture products in the United States, those products will be made in other countries and shipped here.
Numerous studies have documented how the grossly misnamed Affordable Energy Act of 2009, also known as Cap and Trade or more accurately Cap and Tax, will raise the cost of energy for every American. If the cost of all energy rises dramatically, will industrial production stay in this country or will it move to China or India that is not constrained by the cost of energy regulations? China and India already enjoy a significant cost advantage over American producers in many fields; this will just exacerbate that advantage.
While the US taxpayers are paying to support the preservation of United Auto Workers jobs, with outlandish pay and benefit costs, at GM and Chrysler, the same administration is willing to drive industrial production overseas. Perhaps this is why the administration is also supporting Card Check legislation that will allow easy unionization of millions of workers in the service industries. It knows that its other policies will destroy millions of well paying industrial jobs in this country. Based upon the Spanish government’s experiences with subsidizing alternative energy sources through higher conventional energy prices, Cap and Tax will destroy 2 million jobs per year in this country.
For such a damaging plan to be seriously considered there must be a group that benefits from its passage. Just as Joseph Kennedy benefited handsomely from FDR’s programs in the 1930’s, it turns out that some of main benefactors of this program are also politically very well connected.
In 2004, Al Gore, former Vice President and author of Inconvenient Truth, started Generational Investment Management (GIM) to provide funding to businesses associated with alternative energy. GIM also happens to own 10% of the Chicago Climate Exchange, which will issue the carbon credits that Cap and Tax legislation is based upon.
In 2007, Al Gore became a partner in the venture capital firm of Kleiman, Perkins, Claufield and Byers (KPCB). This firm is heavily invested in renewable energy and electrical grid improvements. The market for their products is almost completely dependent on government programs in the form of subsidies, tax breaks or regulation. Al Gore’s contribution to KPCB is to promote government intervention into the energy markets.
It is not surprising that venture capital firms and investment firms that will have a stake in the trading of carbon credits, have made extensive campaign contributions to those legislators proposing Cap and Trade legislation. Clearly, the American public looses in the form of higher energy costs and lost jobs however, a few politically well connected individuals will have much to gain as the result of further government regulation of energy consumption.
David Nace was raised in rural western Pennsylvania. Graduated from Penn State University with an Undergraduate degree in Engineering and a Masters degree in Business Administration. He has managed and co-owned a construction company since 1989. Dave is active in the Associated Builders and Contractors organization on the local and national level, and is able to demonstrate the consequences of legislation and policies in concise and easily understood articles.
