Thursday, August 13, 2015

Clean Power and the Poor

Redistribution plans have become the norm in American governance. It's a 'fairness' thing and government vote seeking politicians decide what's 'fair.'

And determining what's 'fair' usually gets down to pandering to who has the most votes or to that set of aligned lobbyists or 'public servants' (such as teachers unions) that can offer the most support for the self interested vote seeking politicians.

Much of the money used to support Social Security, Medicare, ObamaCare, Medicaid, housing subsidies, K-12 schools, teachers' pensions, student loans, Pell Grants and numerous other government programs is first taken from one set of Americans (aka taxpayers) and then transferred to other groups of Americans --- but only after first deducting, of course, the 'handling charge' imposed to pay the government 'redistributors' and providers of 'fairness for all.'

It's all done under the banner of fairness and 'free stuff,' of course, but it's really unfair and it's absolutely not free --- especially to the futures for the poor, the students or the underemployed or unemployed 'beneficiaries' of these 'fairness' vote getting programs.

Obama's Climate Plan and Poverty provides a simple and current example of how the basic 'Jonathan Gruber' type scam works on We the Dummies:

"President Obama says that critics of his plan to decarbonize the economy are “the special interests and their allies in Congress” repeating “the same stale arguments” about “killing jobs and businesses and freedom.” He adds that “even more cynical, we’ve got critics of this plan who are actually claiming that this will harm minority and low-income communities.”

Is he thinking of critics who work at the Environmental Protection Agency? . . . they ever so gingerly observe that “it is also important to ensure that to the extent there are increases in electricity costs, that those do not fall disproportionately on those least able to afford them.” 

In particular, the EPA is concerned about “low-income communities, communities of color, and indigenous communities.” The agency orders states “to evaluate the effects of their plans on vulnerable communities and to take the steps necessary to ensure that all communities benefit from the implementation of this rule.” These are the themes of “environmental justice,” the political grievance school that argues for income redistribution to offset the allegedly disproportionate damage to the poor and minorities from pollution.

It is more accurate to say that any economic disparities arise from the rule itself. Regulations that artificially raise energy prices are regressive. By definition the poor—er, low-income community members—spend a larger share of their incomes on fuel and utilities than the well-to-do climate activists of Marin County and Hyde Park.

As energy prices rise, they spill into other basic needs like food, via fertilizer and feed, and housing, via building materials like cement. Everyone ends up with less disposable income and a diminished standard of living, but low-income workers really are worst off. . . .

Perhaps it is bad manners to suggest that the poor themselves might prefer higher incomes rather than the EPA’s form of carbon justice. U.S. economic growth is already much slower than it should be, and the new EPA climate-change rule will make it worse by subtracting billions of dollars every year from potential GDP by misallocating capital and undermining business confidence. This will result in few opportunities and smaller wage gains, with damage to the poorest Americans in particular.

For these reasons, a recent study commissioned by the National Black Chamber of Commerce estimates that the EPA plan will increase the black poverty rate to 32% in 2025 from 26% today. Hispanic poverty will rise to 29% from 23%. No fewer than 28 states raised such economic hardships in their comments to the EPA, to no avail.

The contradiction of modern climate liberals is that they promise lower energy bills and a wind-and-solar jobs boom, with zero trade-offs. But then they demand more redistribution to mitigate the economic and human damage that are the real outcome of their policies. Instead of offering to weatherize the homes of the least fortunate, how about trying to increase prosperity?"

Summing Up

Government programs intended to help one group of Americans are necessarily financed by other Americans.

These programs often operate to diminish America's overall wealth creating capability.

Nevertheless, government bureaucrats and policy makers want us to believe that they can do a better job of creating and allocating wealth than the private sector can do.

It's untrue, of course, but that's how it goes in our government dominated 'Robin Hood' society today.

As redistribution programs continue to grow, the poor and the young will suffer.

And so will we all.

That's my take.

Thanks. Bob.

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