The Falsehoods Behind the Push to Repeal “Job Killing” Regulations
Yesterday, Republicans in the U.S. House Science Committee held a hearing titled, “Making EPA Great Again!” It was for a bill that would, ironically enough, cripple the U.S. Environmental Protection Agency by limiting its ability to use scientific data to create new regulations.
Last week, U.S. Representative Matt Gaetz of Florida went further, introducing legislation that would literally “terminate” EPA – an agency that, over the last half century, has saved more than 13 million American lives by reducing air pollution that triggers heart attacks and lung disease.
Along the same lines, President Trump signed an executive order calling for a rollback in all kinds of regulations – from environmental to financial.
President Trump: “This week, we also took significant action to roll back the massive regulation that is devastating our economy and crippling American companies and jobs. That’s why I’ve issued a new executive order to create a permanent structure of regulatory reduction. This order requires that for every one new regulation, two old regulations must – and I mean, must – be eliminated. It’s out of control.”
Okay, let’s break that statement down, to examine the factual accuracy of the argument that is being used to dismantle America’s clean air and clean water protections.
First, Trump and his Congressional allies claim that President Obama’s environmental regulations were job killers – in particular, that they bankrupted oil and gas firms and coal companies.
If Obama was trying to kill the oil and gas industry with new regulations, he failed badly – because drilling increased dramatically during his administration. Driven by innovations in hydraulic fracturing (which Obama encouraged), natural gas production in the U.S. jumped 34 percent from 2008 to 2015, according to the Energy Information Administration. During this boom, America became No. 1 natural gas producer in the world. U.S. oil production nearly doubled. That’s hardly evidence of an industry – to use Trump’s words “devastated and crippled” – by an out of control EPA.
Nor did the overall economy suffer because of Obama’s environmental regulations. The U.S. unemployment rate dropped by more than half during his two terms in office, falling from 10 nearly percent in 2009 to 4.6 percent in 2016.
Some fossil fuel companies did go bankrupt. But the evidence shows these failures were caused by the excesses of the natural gas industry itself. It drilled so many wells and produced such an overabundance of gas that prices plummeted, making drilling less profitable and coal-fired power plants less competitive and economically viable.
“Job killing” political rhetoric aside....the big picture is that decades of research by economists has documented that there is no evidence that environmental regulations “kill jobs.”
Data from the U.S. Bureau of Labor Statistics show that only about two tenths of one percent of layoffs are caused by government regulations of any kind, including environmental regulations. Layoffs are far more often caused by lower overseas labor costs, changes in technology, declines in business demand, and changes in ownership, including buyouts.
The “Inconvenient Truth” for Republicans is that environmental regulations – more often than not – create jobs. Why? Because regulations require the construction of sewage treatment plants, sewer lines, air pollution control systems and other physical improvements. Companies are forced to invest money upgrading their plants instead of wasting it on inflated CEO salaries or stock buybacks that help Wall Street but not Main Street.
Investors and corporate boards may cheer the drive for de-regulation by Trump and his Congressional allies, because it may provide a few percentage points more profit for investors. But the real victims will be the Trump voters, who will choke on the air pollution unleashed by the killing of EPA.