To read a recent New York Times article on Senate cap-and-trade legislation is to get a sense of the rules of the game and the media playing field on which Kansas City area businesses must compete.
According to the Times, the Senate measure, sponsored by Democratic Sens. John Kerry and Barbara Boxer, “aims to reduce greenhouse gas emissions under a cap-and-trade system that sets a nation-wide limit on emissions but allows polluters to buy and sell permits to meet it.”
The key word here is “polluters.” Until environmental activists and their media allies began playing with the language, no one had thought of carbon as a “pollutant” or those who emit it—namely all businesses—as “polluters.”
Congress apparently shares in this anti-business bias. The House narrowly passed its own version of cap-and-trade in June. And in early November, the Senate passed the comparable Boxer-Kerry bill out of committee.
What remains unclear is why Congress—including area Reps. Dennis Moore and Emanuel Cleaver—has supported legislation that adds such an unhealthy dollop of uncertainty to an already unstable economy.
The local economy seems particularly vulnerable. Ed Robb, a fellow at the libertarian Show-Me Institute and a former University of Missouri economics professor, observes that the Midwest derives 80-90 percent of its electric power from coal, the chief villain in the media morality play.
Robb believes that the legislation as envisioned would have “fairly devastating effects on the economy” of Missouri. He contends that the extra utility costs would lead to a loss of some 23,000 jobs and over $2 billion in personal income.
The prospects on the Kansas side seem no rosier. Amy Blankenbiller, CEO of the Kansas Chamber of Commerce, projects a loss of 20,000 jobs in just a few years and an estimated $80 billon reduction in the gross state product over the next 25 years, as well as increased costs for manufacturing and a decline in chemical manufacturing. “Folks are worried,” says Blankenbiller.
“Any significant increase in energy prices,” adds Robb, “will take out steel manufacturing and aluminum manufacturing for sure. They can’t compete against Chinese products.”
One reason they can’t is the prodigious rate of Chinese coal-plant construction. That cheap energy has helped fuel remarkable expansion there for more than a decade, and China plans to keep building for years to come. That, Blankenbiller says, is something the U.S. has been complaining about since the Kyoto protocols were drafted in the early 1990s, and she wonders why we’re still having this discussion nearly 15 years later: “This is not a new argument.”
The Kansas Chamber, she said, does see future opportunity for the state in the development of renewable energies. The state, after all, ranks third nationwide in wind energy potential, which will come as news to no one west of Lawrence. But the forced march to conversion dismays Blankenbiller and just about every business leader close to the issue.
“Most of the technological fixes you would need are not currently commercially viable,” says Chuck Caisley, senior director of public affairs for Kansas City Power & Light. “We have solar, wind, other technologies, but at costs significantly greater than fossil-fuel generation” at this point.
A further problem with renewable energy, as Robb notes, is that the technology is not yet dependable, “I’m one of these old-fashioned people. When I throw a light switch, I want the lights to come on.”
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