Tag Archives: Wealth Redistribution

Cap and trade will raise electricity prices and increase unemployment

Representative Michele Bachmann
Representative Michele Bachmann

Michele Bachmann has a post on her blog about a new study by a Spanish economist regarding the cost of green job initiatives.

Excerpt:

A study directed by Dr. Gabriel Calzada, an economics professor at Juan Carlos University in Madrid, concluded that every “green job” created in Spain resulted in 2.2 other jobs being destroyed.

The study emphasized that only 10% of the “green jobs” created could be considered permanent – such as maintenance of renewable power systems. The remaining jobs consisted of temporary jobs in construction, fabrication and installation jobs; along with administrative positions, marketing, and engineering projects.

Spain has been providing subsidies to create green jobs, and this is viewed by some as a model for future US energy policy.

Bachmann continues:

“If U.S. subsidies to renewable producers achieve the same result — and President Obama has held Spain up as a model for how to subsidize renewables — the U.S. could lose 6.6 million to 11 million jobs while it creates three million largely temporary ‘green jobs.'”

Furthermore, Dr. Calzada stated that “the loss of jobs could be greater if you account for the amount of lost industry that moves out of the country due to higher energy prices.”

Thomas J. Pyle of the Institute for Energy Research adds:

“As this study makes clear, Spain has spent billions in taxpayer resources to subsidize renewable energy programs in an effort to jumpstart its ailing economy – and what they’ve gotten in return are fewer jobs, skyrocketing debt and some of the highest and most regressive energy prices in the developed world. Now, as U.S. policy-makers prepare to embark Americans upon a similar course, this report offers our first realistic glimpse into what we should expect in return for that unprecedented sacrifice of public resources and personal autonomy.”

The IER has a list of the key findings from the study in that post.

Ed Morrissey at Hot Air adds:

Why did the jobs disappear?  In part because of the higher capital confiscation of the government, and in part because the green policies pushed industry out of Spain. Actually, the study didn’t count jobs lost through “industrial relocation”, which in this case amounts to capital flight.  The largest stainless-steel producer in Spain directly linked its decision to move operations to South America to the higher energy costs imposed by the government.

In the US, we could see a massive flight, and not just in manufacturing.  High-tech industries that rely on cheap energy could be forced to find less expensive environments. Bloomberg’s economist notes that Microsoft and Google have already relocated their servers once to get cheaper energy.  The Internet is flexible enough to allow employers to go almost anywhere in the world to host their servers, and in this economy, there will be plenty of competition for them.

In a related post, Gateway Pundit notes that the cap and trade policies of the Democrats will also cause consumer electricity prices to soar.

Excerpt:

Democrats know that their cap and trade energy policies will devastate the economy.

…Cap and trade policies would likely cost American families $700 to $1,400 dollars per family per year according to the video above. The Department of Energy estimated GDP losses would be between $444 billion and $1.308 trillion over the 21-year period. Cap and trade also could cost the US 4 million jobs. In Missouri and the Midwest where energy is “cheap” it would cause electricity rates to double.

And, it would likely do nothing to help with the make-believe global warming junk science.

And GP also links to this video showing what we can expect from the Democrats on this issue:

Further study

I posted a list a while back of the expected increases in electricity prices, broken down by state, here. More about the impact on consumers from John Boehner is here.

More about the rise in unemployment we can expect from green jobs initiatives is here. Info about Obama’s tax hikes on energy producers is here. Information about possible carbon tariffs is here.

Information about the recent Cato statement of 700 scientists who dissent from man-made global warming is here.

Millions Will Lose Health Care from their Employer Under the Democrats’ Plan

House Republican Leader John Boehner
House Republican Leader John Boehner

I spotted this scary post over at John Boehner’s blog. The post, written by Kevin Lewis, links to this AP article that highlights a new study from the Lewin Group. I blogged before about the Democrats’ plan to equalize life outcomes and redistribute wealth by nationalizing health care. Now we get more details of how they’ll do it.

Here is a summary of the Democrats’ plan:

President Barack Obama and many Democrats want to create a government insurance plan to compete with private plans that now cover about 170 million Americans. The issue is major sticking point for Republicans and the insurance industry.

And the predicted results of that plan:

The Lewin study found that if such a plan were open to all employers and individuals, and if it paid doctors and hospitals the same as Medicare, the government plan would quickly grow to 131 million members, while enrollment in private insurance plans would plummet.

“The private insurance industry might just fizzle out altogether,” said John Sheils, a Lewin vice president and leading author of the study.

By paying Medicare rates the government plan would be able to set premiums well below what private plans charge. Monthly premiums for family coverage would be $761 in the government plan, compared with an average of $970 in private plans, the study estimated. Employers and individuals would flock to the public plan to cut costs.

Lewis cites two of the study‘s key findings:

“If as the President proposed, eligibility is limited to only small employers, individuals and the self-employed … The number of people with private coverage would fall by 32.0 million people.”

“If the public plan is opened to all employers as proposed by former Senators Clinton and Edwards, at Medicare payment levels … The number of people with private health insurance would decline by 119.1 million people. This would be a two-thirds reduction in the number of people with private coverage (currently 170 million people).”

More here at the Heritage Foundation.

Further study

Here are some previous links that are relevant:

An analysis of the Democrats socialist health care policies

I would summarize the ideals of Democrats (socialists) as follows:

  1. There are unequal life outcomes in society
  2. Those who have little wealth are the victims of those who produce wealth
  3. We (democrats) must transfer wealth until everyone’s life outcomes are equal, regardless of their life choices
  4. We (democrats) must use government coercion to achieve this equality
  5. Since we (democrats) are so morally superior, we are not obligated to transfer our own wealth to anyone

Consider health care. Some risky lifestyle choices are more likely to require more health care services. The socialist’s goal is to make sure that no one is deterred from making these risky choices. Those who do not engage in these risks must be forced to pay for the health care of those who do choose to take on these risks. That way, everyone is equal in the end.

The way this is done is to make sure that people who don’t engage in risky behaviors cannot pay less for their health care than those who do engage in risky behaviors. Let me explain.

Suppose a safe person S knows that he only needs coverage for catastrophic care, since his lifestyle choices eliminate the need for elective treatments like abortions, birth control, STD medications, sex changes and drug addiction treatments. He can be covered for a very low premium.

Consider another irresponsible, risky person R who is engaged in all kinds of risky behavior. He can be covered for all of the medical services for a very high premium. His own choices expose him to risks that will require more medical services.

Democrats (socialists), solve this problem by forcing S to pay for mandatory health care with a very high premium that covers services he will never use. That way, he is really paying for his own health care, and R’s health care, too.

Take a look at this article I found on Health Care BS. In the article, they cite Michael Tanner of the Cato Institute, who analyzes the health care policies that may be included in the Democrats’ health care reform bill.

This is the one I want to draw your attention to, because this is what single-payer countries like Canada have that causes them so many problems:

An Individual Mandate. Every American will be required to buy an insurance policy that meets certain government requirements.  Even individuals who are currently insured — and happy with their insurance — will have to switch to insurance that meets the government’s definition of acceptable insurance, even if that insurance is more expensive or contains benefits that they do not want or need.

And here is another one that will force employers to lay off American workers because employers have to pay more for the same productivity.

An Employer Mandate. At a time of rising unemployment, the government will raise the cost of hiring workers by requiring all employers to provide health insurance to their workers or pay a fee (tax) to subsidize government coverage.

Yes, that’s right. Socialism attacks businesses. Attacking businesses causes unemployment.

And there’s more:

A Government-Run Plan, competing with private insurance.  Because such a plan is subsidized by taxpayers, it will have an unfair advantage, allowing it to squeeze out private insurance.  In addition, because government insurance plans traditionally under-reimburse providers, such costs are shifted to private insurance plans, driving up their premiums and making them even less competitive. The actuarial firm Lewin Associates estimates that, depending on how premiums, benefits, reimbursement rates, and subsidies were structured, as many as 118.5 million would shift from private to public coverage.   That would mean a nearly 60 percent reduction in the number of Americans with private insurance.  It is unlikely that any significant private insurance market could continue to exist under such circumstances, putting us on the road to a single-payer system.

When government controls your health care, you pay them at gunpoint and when you want care you get in line behind people who paid nothing into the system. That is socialized medicine, the dream of all Democratic socialists.

And there’s also redistribution of wealth:

Massive New Subsidies. This includes not just subsidies to help low-income people buy insurance, but expansions of government programs such as Medicaid and Medicare.

And remember what I said about the government needing to reducing costs when demand skyrockets for “free” care?

Government Playing Doctor.   Democrats agree that one goal of their reform plan is to push for “less use of aggressive treatments that raise costs but do not result in better outcomes.”  While no mechanism has yet been spelled out, it seems likely that the plan will use government-sponsored comparative effectiveness research to impose cost-effectiveness guidelines on medical care, initially in government programs, but eventually extending such restrictions to private insurance.

This is all caused by the good intentions of people who have no knowledge of economics, whatsoever. And it is important to note that it is this kind of naive, incompetent meddling in the free-market that leads to poverty and the loss of all of our liberties.

Further study

Here are some previous links that are relevant: