Competing In A Global Economy

January 14, 2010

January 14, 2010

Hello everybody out there in farm country. This radio commentary is brought to you by the Renewable Fuels Association, Wal-Mart Stores, Monsanto, and John Deere. They are all friends, supporters, and allies of a healthy farm economy and prosperous rural America. Thank you.

And now for today’s commentary—

There is a big liberal push for a cap and trade law in this country that supposedly would reduce the greenhouse gas emissions over time. But, did you know that California already has their own version of cap and trade designed to cut carbon emissions beginning in 2012? The law requires that their carbon foot print be reduced to the level of 1990 by 2020.

All of that might sound great in happy times. However, to impose a heavy tax and regulatory burden on California, which has 12 percent unemployment and is already broke, makes no sense at all. And that is what has prompted a ballot initiative in California to repeal the law.

Now, here is why all of this activity in California is so significant. California voters are beginning to realize that new taxes and regulations will push businesses to leave. They will be looking for business- friendly states like Texas or Nevada. Also, their well-intended costly effort to cut greenhouse gases will have no global impact unless the world joins their effort. And the world is not going to join their rush to economic suicide.

The same logic tells us that if the United States should pass a cap and trade law, our businesses would move to China or India or anywhere to escape government taxes and regulation.

We are in a global economy, like it or not, and we have to be competitive or we will see the jobs go to other countries.

Over-regulation of animal agriculture can push the pork production and the poultry production offshore. When that happens, we not only lose our livestock farms, we lose the processing plants and jobs. The cost of food goes up with added transportation costs.

With every tax that is imposed and every new regulation, we must be ever-mindful of the costs that are incurred. We want to keep our jobs here in the U.S. and the 10% unemployment that we suffer now reminds us of that.

Until next week, I am John Block in Washington.