US Chamber of Commerce Blog
During a visit to the U.S Chamber of Commerce, Gov. Chris Christie of New Jersey walked through his recipe for putting the U.S. economy back on track.
It starts with stripping away the "mountain of regulations" currently strangling America's small businesses.
"Small businesspeople don't have a lawyer on staff," Christie told a group of small business owners and other members of the Latino Coalition gathered Wednesday at the Chamber. "They can't afford to hire two or three people to fill out the paperwork, and they get overwhelmed by what government places on them."
Christie noted that the Obama administration last year issued 41,000 pages of new federal rules -- an all-time record. He later referenced a Small Business Administration study showing that the annual toll of federal regulations on small business owners now exceeds $10,000 per employee.
"It's unacceptable," Christie told the audience. "It's a hidden tax that every company, every business, large and small, has to pay."
On his first day in the governor's mansion in 2010, Christie signed an executive order freezing all pending regulations issued by his predecessor. Over the next three months, he and his administration met with business leaders from across the state to find out which rules were the most onerous and impeded job creation, he said. One year into his first term, he had already eliminated one third of those new regulations.
"It changed the business environment in our state," Christie said.
He added: "The next president should sign an executive order on the first day freezing any new regulations, as we begin to take a look back at the mountains of regulations that were put in by this last administration."
The governor also pitched a new federal net-zero rule on regulations.
"So, you want to issue some new regulations? That's fine, you think that's necessary," Christie said. "But then you have to eliminate or subset an equivalent amount of regulation so we don't continue to add to this mountain."
On the topic of regulations, Christie noted that the Dodd-Frank financial rules have proven to be yet another example of the "overarching hand of Washington" putting the clamps on economic growth. He noted that small, community banks have been hit particularly hard by the rules, with many of them forced to close their doors.
"The loans, the seed capital for those businesses come from our small, local, community and state-chartered banks," he said. By hindering those small banks, Christie added, Dodd-Frank "hurts the small businesses in our country, the new folks who come here, who want to build a business, who go to their local community banker who knows them and knows their family and is willing to take a chance on them."
Christie also stumped for comprehensive tax reform that lowers the country's individual rates for small businesses and the corporate rates for large companies.
Lastly, the governor urged Washington's leaders to adopt "a robust, smart national energy policy that exploits the resources that we have been given in this country, and works with our neighbors in Canada and Mexico to make sure that North America is the continent for energy in the 21st century."
With a smart energy policy, an improved tax climate and fewer regulations, Christie concluded, "you'll see economic growth 4 or 5 percent, and then you're going to see an America that's leading the world into the 21st century."
The G7 has called for a transformation of electricity generation towards clean sources by 2050.
They said fossil fuel emissions should not be allowed in any sector of the economy by the end of the century.
Five of the world's seven richest countries have increased their coal use in the last five years despite demanding that poor countries slash their carbon emissions to avoid catastrophic climate change, new research shows.
Britain, Germany, Italy, Japan and France together burned 16% more coal in 2013 than 2009 and are planning to further increase construction of coal-fired power stations.
Less woolly thinkers understand that fossil fuels aren't going away, because they serve a useful purpose. The International Energy Agency--no cheerleader for fossil fuels--sees global coal demand only "levelling off," not going down, through 2040 [See slide 8].World Energy Outlook 2014 by Dr. Fatih Birol, Chief Economist of the the International Energy Agency (IEA) from International Energy Agency
ExxonMobil Outlook for Energy Chart: Global Energy Supply through 2040Source: ExxonMobil's Outlook for Energy.
ExxonMobil's Outlook for Energy estimates that about half of the world's electricity will come from coal and natural gas by 2040, while solar and wind will generate only a fraction of that.
Keep this energy reality in mind when you see policymakers lay out plans for greenhouse gas reductions.
For instance, the Obama administration submitted a goal to the United Nations a goal of reducing U.S. emissions by 26%-28% of 2005 levels by 2025. However, as the Institute for 21st Century Energy's Steven Eule points out, even with efforts like EPA's disastrous carbon regulations ("Clean Power Plan") and a plethora of new efficiency standards for vehicles and appliances, it's missing one-third of its emissions goals.energy_institute_mindthegap.png Obama administration's 28% greenhouse gas emissions goalSource: Institute for 21st Century Energy.
How will the gap be filled? Part of it will come from even more costly regulations on the economy, Eule writes:
EPA's fiscal year 2015 budget request, however, provides a clue. It says the Agency will soon begin considering greenhouse gas regulations on the refining, pulp and paper, iron and steel, livestock, and cement sectors. So we can expect the industrial sector will almost certainly be on the hook for reductions, even though there is no reference at all to industrial emissions in the INDC. Still, seeing as the entire industrial sector emitted a little over 800 MMTCO2 in 2013, even very steep cuts by industry won't deliver nearly what's needed. Where the administration goes next is anyone's guess.
While G7 leaders imagine a prosperous world without abundant fossil fuels, American consumers and businesses should brace for a future of more regulations along with less reliable--but more costly--energy supplies.
Ending the oil export ban will be a positive triple play for the economy: Lower fuel prices; more jobs; and more economic growth.
In a report for the American Council for Capital Formation (ACCF), Margo Thorning and William Shughart looked at recently studies on the effects of lifting the 40-year-old ban on exporting American crude oil. Their conclusions are summed up in three points:Lower gas prices. More jobs. More investment and economic growth. Lower Gas Prices
Thorning and Shughart briefly explain how world oil markets work:
Basic economic principles would dictate that if we diversify supply and increase the amount of crude oil flowing into global markets, assuming international demand remains constant given the integration of efficient technologies, the world price of crude would fall.
Because U.S. gas prices are tied to the international price of oil, we will see lower prices at the gas pump.
How much? Anywhere from $0.02 $0.12 a gallon. One study by ICF International estimates consumers will "save up to $5.8 billion per year, on average, from 2015 to 2035 as a result of lowered prices on all petroleum products."More Jobs
Lifting the export ban would open up new markets for American energy companies to sell oil. This will stimulate more investment in energy development, creating jobs.
On the low end, the Brookings Institution estimates 200,000 new jobs per year, the Aspen Institute predicts 630,000 more jobs by 2019, and IHS estimates 859,000 jobs annually.
What's more, these jobs won't just be in the energy sector:
Looking at various sectors and timeframes, the Aspen Institute forecasts that new construction will result in 216,000 new jobs by 2017; the manufacturing sector will gain an average of 37,000 jobs per year through 2025; and, finally professional services related to the oil and fuels sector will increase by an average of 148,000 jobs per year through 2025.More Investment and Economic Growth
More investment and jobs will mean more economic growth.
IHS estimates an increase of $86 billion - $170 billion annual in GDP from 2016 to 2030, while the Brookings Institution estimates that from 2015-2039, we could see as much as $1.8 trillion added to the economy.
Lawmakers, take note. Everyone who has seriously looked at lifting the oil export ban has come to the same conclusions: Both gas consumers and America's domestic energy producers will win.