Romney energy plan shows candidate’s changing views, draws questions on job claims
By Steven Mufson and Juliet Eilperin,
The energy chapter of Mitt Romney’s “Believe in America” economic plan is chock-full of statistics and job claims — numbers that will get a closer look after the recent dismal employment figures.
One of the controversial estimates in the plan is that new ozone regulations under President Obama would cost the U.S. economy 7.3 million jobs — more than all of the Americans who are now working for makers of apparel, automobiles, airplanes, machinery, paper, plastics and rubber, rail cars, beverages and cigarettes, and food and livestock products, as well as those working in mining or oil and gas extraction.
Some economists say the number is a stretch. And it may be moot, since Obama overruled the Environmental Protection Agency and shelved new ozone regulations in September, angering environmentalists.
The Romney campaign says that the “Believe in America” booklet went to press the day before Obama’s action on ozone rules. Nonetheless, Romney’s campaign Web site still asserts that the Obama administration “has pursued numerous regulations that would drive up energy prices while destroying millions of jobs.”
It is just one in a slew of Romney attacks on Obama’s energy policies. The Republican presidential candidate talks about building nuclear plants, opening up virtually every part of U.S. land and waters to oil and gas drilling, exploiting coal and stripping the EPA of much of its authority, especially when it comes to regulating greenhouse gases.
Asked whether any place would be off limits for oil drilling, campaign spokesman Andrea Saul said, “Governor Romney will permit drilling wherever it can be done safely, taking into account local concerns.”
Energy is a tricky issue this year. Romney’s and Obama’s positions have moved along with the nation’s shifting energy landscape. Obama has grown more supportive of natural gas and oil drilling, striving to become an “all of the above” energy candidate.
Recently, Romney, who says he opposes federal aid for renewable energy, has portrayed the bankrupt solar panel maker Solyndra, a recipient of $535 million in federal loan guarantees, as a poster child of policy failure. After talking to reporters outside the shuttered Solyndra plant last week, Romney released a television ad featuring images of the plant and of Romney, who tells viewers that the now-bankrupt company’s federal funding is an example of “crony capitalism.”
Romney’s view that the government should cut off aid to renewable energy marks a reversal for the candidate. On Jan. 22, 2003, after becoming Massachusetts governor, Romney stood in front of Konarka, a developer of thin-film solar panels, and handed out $9 million from a “green energy fund” to renewable energy firms. Two years later, he said that “clean energy” was “an economic engine very much like biotech” that could spur “explosive growth” in Massachusetts. Romney said he would make Massachusetts a more appealing place for such companies.
On June 1, however, the day after Romney stood in front of Solyndra, Konarka went bankrupt. Although Konarka had raised large amounts from private investors, ultimately it closed its manufacturing plant and laid off 85 people.
Asked whether Romney’s opposition to helping renewable energy firms meant that he was against the popular production tax credits for wind and solar, Saul said, “Governor Romney believes the government should get out of the business of picking winners and losers, and let the free market drive innovation.” Like Obama, Romney does favor aid for basic research into cleaner energy technology.
The job statistics underpinning key parts of Romney’s energy plan — collected from media accounts, conservative think-tank reports and other sources — highlight the change that the former Massachusetts governor has undergone since his last presidential campaign, as well as his stint in public office. In each case, Romney has pointed to the most extreme projections of the results of Obama’s policies to support his proposals.
The Romney “Believe in America” booklet uses estimates of jobs linked to the Keystone XL pipeline that far outstrip those put forward by TransCanada, the would-be builder of the pipeline. Romney says the project would create 131,000 jobs; TransCanada said it would create 13,000 construction jobs and 7,000 jobs with suppliers. (TransCanada’s method counted one job done over two years as two jobs.)
Romney says that, if elected, he would immediately approve the crude-oil pipeline.
Another example is the federal limits on pollution from industrial boilers, a hot-button political issue that has drawn intense criticism of EPA from manufacturers. The Romney plan states that the rules “may put yet another 800,000 jobs at risk,” on top of other new federal air-quality requirements.
Although the EPA proposed new rules for boilers in April 2010, it announced in December 2011 that it had “reconsidered” the rule. The agency issued a new proposal that could cost $2.3 billion while delivering from $28 billion to $68 billion in health and economic benefits. The agency estimated it would create 2,100 new jobs on balance.
Even industry’s job numbers are far more modest than the Romney document. The Council of Industrial Boiler Owners says the revised EPA rule, which may become final this month, could cost 228,000 jobs by imposing $14.4 billion in new pollution control costs. Bob Bessette, the group’s president, said the EPA’s staff has responded to the concerns of the wood and paper products industry, chemical manufacturers and others.
“They have come a long way,” Bessette said in an interview. “I believe they, on the staff level, are trying their best to come up with a rule that is achievable. The question is whether the president will allow this to happen.”
Hank Courtright, senior vice president of global strategy at the Electric Power Research Institute, said he was skeptical of analyses that predicted specific job losses linked to stricter EPA air-quality regulations.
“I wouldn’t believe anybody’s results on that,” he said.
Charles Ebinger, who directs the Brookings Institution’s energy security initiative, said Romney has painted federal rules with too broad a brush on the campaign trail. The 2010 Deepwater Horizon explosion in the Gulf of Mexico, Ebinger noted, highlighted the negative consequences of a lack of federal oversight, though Romney condemns Obama for ordering a drilling moratorium and using the oil spill as “political cover” for bad policies.
“The rhetoric of Romney is worrisome, that all regulation is bad,” Ebinger said, “which isn’t to say there isn’t some stupid regulation out there.”
In 2008, Romney invited energy experts to Massachusetts and urged them to put all alternatives on the table, according to one person who was there. He spent hours looking over slide presentations and entertaining ideas, some of which alarmed his political experts.
In 2010, Romney wrote in his book “No Apology” about a variety of energy proposals, including “feebates” to reward buyers of fuel-efficient vehicles. He also praised a proposal by one of his advisers, Harvard University professor N. Gregory Mankiw, to institute a “tax swap” — imposing a gasoline or carbon tax while reducing other taxes. “A great deal of work needs to be done if it is to become a viable option,” Romney said.
This year, the GOP presidential candidate has surrounded himself with many advisers, such as Mankiw, who worked in the George W. Bush administration. They include James Connaughton, former head of the Council on Environmental Quality and now an executive at Constellation Energy Group; Andrew Karsner, former assistant Energy secretary for efficiency and renewables; Mark Maddox, now with the Livingston Group, who worked for the Energy Department focusing on fossil-fuel issues. Maddox oversaw efforts to fund carbon sequestration projects, which have not proved to be economical. Rebecca Rosen, a staff member of Sen. Lisa Murkowski (R-Alaska), joined the campaign this week.
In addition, Romney has consulted with Harold Hamm, a billionaire oilman and chief executive of Continental Resources who struck it rich with early and aggressive exploration in North Dakota’s Bakken formation. The Oklahoma-based Hamm, who says there is as much oil in the Bakken formation as in the proven reserves in the rest of the United States put together, has also hosted fundraisers for Romney. Last fall, he visited Washington to lobby against rollbacks of tax breaks for oil and gas drilling.
Some of Romney’s current positions appear to be at odds with his views when he was Massachusetts governor.
In November 2005, Romney supported an agreement by Northeastern states to form a regional group to reduce greenhouse gases through a cap-and-trade system that would slightly raise utility rates. “This is a great thing for the Commonwealth,” Romney said, according to a Boston Globe article at the time. “We can effectively create incentives to help stimulate a sector of the economy and at the same time not kill jobs.”
His presidential campaign’s energy plan rejects a similar cap-and-trade approach to greenhouse gases backed by Obama as a “complex scheme” that would have dealt “a crippling blow to the U.S. economy.” In his 2010 book, Romney also tried to distance himself from the regional cap-and-trade plan.
While Romney has sharply attacked Obama for investing federal dollars in wind and solar projects, Ebinger said that it is unlikely that Romney would cut off all federal research and development funds for renewable energy.
“In reality, he is a venture capitalist, for better or worse. He would realize R and D [research and development] is very important,” Ebinger said. “I can’t see him bowing to the right wing of the Republican Party and saying, ‘We won’t do any R and D.’ ”
Jeffrey Hartley, a Salt Lake City-based energy industry consultant and lobbyist, said he got a sense of the GOP candidate’s stance after attending eight Romney fundraisers over the past several years.
“Everything I’ve heard him say shows he understands the issues we’re facing,” Hartley said.