In what was billed as a landmark speech, President Obama recycled more of the same rhetoric and ideas that Americans have been hearing for the last four years. In sum, his speech proposed the following wish list: more regulation, more tax hikes and less jobs. To top it all off, the President refused to give Keystone Pipeline the green light, despite the overwhelming bi-partisan support and a State Department Environmental Impact Statement saying the environmental risks of the project are minimal.
President’s Wish List:
Ending So-Called Tax Breaks for Oil and Gas Companies
Obama’s antagonistic stance towards oil and gas companies is antithetical to tax policies he’s previously advocated for. Arguing that full business expensing creates jobs by lowering companies’ investment costs, Obama championed this policy for small businesses. The benefits of timely cost recovery policies are never more evident than in the capital intensive oil and natural gas industry. A Wood-Mackenzie study shows that repealing oil and natural gas producers’ tax deductions would cause companies to delay or scrap future projects and could kill 170,000 jobs.
Cap and Trade
President Obama attempted to pass Cap and Trade in his first term, but failed, even with large majorities in both houses. The simple fact is that a cap and trade scheme would be a massive tax hike.
“The implementation of a cap and trade program on American businesses will result in a tax increase of $646 billion dollars over 10 years…When fully phased in, this will be a $100 billion per year tax on American businesses and a $3,100 tax ion energy American family. This tax will decrease U.S. competitiveness and increase consumer costs.”
Coal
The most troubling part of President Obama’s speech was his call via executive order for the EPA to introduce and enforce new standards on existing power plants. Though hardly surprising given the President previous statements on coal-fired plants, this plan will cause energy prices to soar and jobs to disappear. Tens of thousands of jobs and livelihoods in states like Kentucky, West Virginia, Ohio, and Pennsylvania depend on the very industries the President is looking to destroy with new regulations. Citing the Department of Energy, which reported that coal will produce 37% of America's energy until 2040, Senator Joe Manchin (D-WV) said it best: “It’s clear the President has declared a war on coal,”
Despite the U.S energy sector being one of the few bright spots in an otherwise struggling economy, the President seems determined to make life more difficult and more expensive for energy consumers all across the country. With huge supplies of oil, natural gas, and coal, the United States can create thousands of jobs and billions of dollars of wealth. Meanwhile the President seems determined to stifle and disrupt that potential in order to meet his own political agenda.