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Will Climate Protection Legislation Protect Workers Too?

One great fear is blocking public support for climate protection: The fear that protecting the planet will destroy millions of jobs. Without a bold program to protect workers from the effects of climate protection

One great fear is blocking public support for climate protection: The fear that protecting the planet will destroy millions of jobs.

Without a bold program to protect workers from the effects of climate protection, the struggle against global warming can all too easily come to be perceived as a struggle against American workers.

Climate protection advocates have often addressed the threat of possible job losses by pointing out that a transition to green energy would create far more jobs than it would eliminate. While that may be true, it also misses the point. The fact that some people get new jobs provides little solace for the individuals and communities who have lost theirs. They must be protected.

The Great Fear

Fear of job loss is the centerpiece of the campaign against climate protection legislation.

According to the Web site of the anti-climate protection coalition Energy Citizens, “This legislation will cost more than 2 million American jobs – hurting millions of Americans who work in or depend on trucking, farming, manufacturing, mining, small business and energy production – or use their cars to commute to work.” The US Chamber of Commerce, Senator Sam Brownback and local “tea party” protests have similarly made job loss the central argument against climate legislation.

Unless climate protection advocates effectively address these fears, both they and the legislation they support risk a devastating backlash from Americans afraid of losing their jobs.

Recognizing Reality: Some Jobs Will Be Lost

Studies indicate that over the long run climate protection will have limited effect on the total number of jobs in the United States: Jobs gained will more or less compensate for jobs lost. Some studies indicate that, overall, jobs will actually be gained because green jobs are more labor-intensive than those they replace. For example, an analysis by the Union of Concerned Scientists found that 185,000 new jobs would be created by 2020 if utilities generate an average of 20 percent of their electricity from renewable sources.

While the employment effects of climate protection legislation are likely to be neutral or positive, they may be considerably greater in industries that make or use products with high carbon footprints. The Congressional Budget Office (CBO) analysis of the House climate bill, for example, says it will probably have “only a small effect on total employment in the long run.” However, “The small effect on overall employment would mask a significant shift in the composition of employment over time.”

“A cap-and-trade program for carbon dioxide emissions would reduce the number of jobs in industries that produce carbon-based energy, use energy in their production process or produce products whose use involves energy consumption, because those industries would experience the greatest increases in costs and declines in sales,” the analysis says.

Studies vary regarding how many jobs might shift as a result of climate change legislation from hundreds of thousands to several million, depending on the year. While this is a small proportion of American jobs, the CBO notes that, “The process of shifting employment can have substantial costs for the workers, families and communities involved.” Of workers who were unemployed during 2003, almost half left the labor force altogether rather than finding another job. Even those who eventually find new jobs may lose twenty percent of their lifetime income. Such effects are likely to be far greater in today’s high-unemployment economy.

What’s Wrong With Proposed Legislation?

Proposed climate legislation includes provisions designed to ameliorate the negative employment effects of climate protection. These programs are to be paid for from the auction of carbon emission allowances.

Industry subsidies: Much of the strategy for such amelioration lies in providing subsidies to particular industries – notably petroleum refiners and trade-exposed, energy-intensive industries. In its summary of the bill, the Senate Committee maintains that the Act “doesn’t just create jobs for the future – it also protects existing jobs in the manufacturing sector as our economy transforms” by providing “support for energy-intensive, trade-exposed industries like chemicals to ensure that US manufacturing remains competitive in the new energy economy.”

As the CBO points out, this “dampens the reallocation of output and employment to industries that produce fewer carbon emissions,” counteracting the bill’s basic purpose of carbon reduction.

This approach has another problem. There is no guarantee that the subsidies will actually be used to maintain or increase employment in such firms. On the contrary, the availability of funds for investment is often used to introduce new employment-reducing technology or to close facilities and relocate production elsewhere in other cities, states or countries. The legislation provides no guarantees against such results. It represents a highly uncertain “trickle down” approach to protecting workers’ livelihoods and economic security.

Transition assistance: The proposed legislation also provides “transition assistance” to individual workers displaced by climate protection policies.

The House bill, for example, establishes a Climate Change Worker Adjustment Assistance program which provides eligible impacted workers 70 percent of average weekly wages for 156 weeks, 80 percent of monthly health care premiums, job training assistance, up to $1,500 for job search assistance, up to $1,500 for moving assistance, and employment services. The Senate “Clean Energy Jobs and American Power Act” contains similar provisions.

This approach to transition assistance is largely based on the Trade Adjustment Act (TAA) worker assistance model. It provides a small supplement to unemployment and funding for modest job retraining. But many workers and unions despise that approach. In practice, it strings individuals and communities along in marginality without helping them to establish a new, decent life. It typically provides training for jobs that don’t exist in communities that have already been devastated by economic change. TAA-style programs are also notorious for long strings of fine print that end up excluding a large proportion of workers affected by change from the benefits they seem to offer.

The Solution: Fix Climate Legislation to Protect Workers

Protecting and restoring individuals: Workers who lose their jobs because of climate protection policies should receive full wages and benefits for at least three years. They should be eligible for up to four years of education or training, including tuition and living expenses. Those unable to take advantage of such a program because of age or other reasons should be guaranteed decent pensions with health care. The opportunity for individuals to access higher education and advanced training will also mesh with the need for the region to develop new labor force capabilities for the new green economy.

Protecting and restoring communities: The long-term effects of climate protection require compensation not just for individuals but for hard-hit communities. Surprisingly, a useful model here comes from John McCain’s 1988 tobacco bill. It established a Community Revitalization Trust Fund which would provide economic development grants over a twenty-five-year period for:

* Business development and employment-creating activities “to provide a more viable economic base and enhance opportunities for improved incomes, living standards and contributions by rural individuals to the economic and social development communities.”

* Activities that “expand existing infrastructure, facilities and services to capitalize on opportunities to diversify economies in tobacco communities that support the development of new industries or commercial ventures.”

* Initiatives designed to “create or expand locally owned value-added processing and marketing operations in tobacco communities,” and technical assistance.

A move to protect communities potentially threatened by cutbacks in coal production can serve as a way to jumpstart the transition away from coal and other carbon-intensive industries. Eastern Kentucky, West Virginia and the rest of the Appalachian coalfield can be made a model of job-positive transition from coal to renewable energy and conservation. Green jobs can be specifically targeted to the communities that will be affected by coal production to preemptively create local jobs that will provide an alternative source of employment.

Protecting and Restoring Regions

During the Great Depression, a regional economic development program, the Tennessee Valley Authority (TVA), transformed one of America’s poorest regions by means of massive energy development. While 75 years later the TVA itself has become a target of environmental criticism, the principle of regional economic development through development of a new energy source is highly applicable to the Appalachian coalfields today. While the TVA by no means provides a model to follow slavishly today, it does provide an instructive example of a transformative use of new forms of energy as the basis for the construction of a new economy.

A regional economic development program could make synergistic many aspects of a new green economy. For example, renewable energy production and distribution could provide employment, a secure power supply and an economic base for many local communities. And they could also provide stable demand for products that could be manufactured in those communities, thereby providing additional jobs.

A pioneering program to build a new economy in Appalachia based on renewable energy and the economic development it supports can provide an image of the new economy we need to build nationally.

Protecting and restoring retirees: It is outrageous that American workers can have worked hard all their lives, only to discover that their pension and retirement health benefits are threatened due to their employers’ economic adversity or strategy. Climate legislation should guarantee that no worker will lose pension benefits as a result of climate protection measures.

Steps to strengthen worker protections in climate legislation are already under discussion. For example, on November 5, 2009, Senator Bob Casey introduced S. 2742, the American Worker and Community Assistance Act. Co-sponsored by Senator Sherrod Brown, the bill would establish a Climate Change Worker Transition and Community Assistance program to provide targeted help to workers who may be adversely affected by climate legislation. Under it, communities and groups of communities could receive funding to develop a strategic plan for diversifying employment opportunities, environmental remediation projects, and conversion of underutilized facilities for more productive uses. Communities could then apply for grants to implement the plan. Communities with low per-capita incomes, high unemployment and loss of traditional sources of employment would be given preference for support. Commenting on the bill, AFL-CIO President Richard L. Trumka said, “It is essential that workers and communities impacted by climate change policy be provided with the tools to transition into the new clean energy economy and the millions of new jobs that stand to be created.”

Green and Fair

Protecting the climate and protecting workers are not alternatives. Neither will happen without the other.

It is a basic principle of fairness that the burden of policies that are necessary for society – like protecting the earth’s climate – shouldn’t be borne by a small minority who happen to be victimized by their side effects. Unless workers and communities are protected against the unintended effects of climate protection, there is likely to be a backlash that threatens the whole effort to save the planet. The challenge for the architects of climate protection is to craft and implement policies to give such workers confidence that they will be protected as America goes green.

Advocates can use a worker-friendly climate protection policy to take the offensive to turn around the public debate: Not only will the legislation create millions of new green jobs, it will also honor and protect those workers and retirees who have contributed their working lives to meeting our nation’s economic and energy needs.

The alternative – failure to act in time to save our earth’s climate – will lead to natural and economic devastation for our country and the world.

(Footnotes are available in the Labor Network for Sustainability’s recently released White Paper: Climate Legislation Must Provide a Just Transition for Workers.

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