Checking the checkers: Wind ads get it right on job risk
The Annenberg Public Policy Center at the University of Pennsylvania posted a piece to their blog this afternoon purporting to poke holes in the American wind power industry's SaveUSAWindJobs.com advertising campaign, as well as pointing out fallacies in Rep. Mike Pompeo's comments on his anti-renewable energy legislation and the Karl Rove-led Crossroads groups' Solyndra ads.
We won't quibble with their findings on Mr. Rove and Congressman Pompeo, but on wind, they are flat wrong. Here are the facts:
Allowing tax credits to expire has the same impact on business as raising taxes. But don't take our word for it. Grover Norquist is widely regarded as an expert on these issues and the Congressional Pledge posted at his Americans for Tax Reform website clearly states that its signers will "oppose any net reduction or elimination of deductions and credits" as these are, in effect, a tax hike.
Raising taxes eliminates jobs. A recent study by national economic consulting firm Navigant found that if the Production Tax Credit for wind is allowed to expire, jobs in the wind industry would be cut in half and private investment would drop by two thirds. This would mean a loss of 37,000 American jobs within a year, according to Navigant, at a time when the U.S. economy needs them most. Furthermore, the Navigant study found that with PTC uncertainty, layoffs would begin now and accelerate with each month the industry neared the expiration deadline.
Bush Administration study shows growth potential. American wind jobs stand poised to grow more than five-fold to half a million in the next 20 years, but only if the Production Tax Credit is continued and taxes on wind energy are not increased. The American wind industry is currently 75,000 jobs strong. According to a Bush Administration Department of Energy estimate, the wind industry would support 500,000 jobs by 2030 when wind would also provide 20% of our electricity, if the right federal policies remain in place. The Production Tax Credit is essential to this growth. Wind accounts for 35% of all new electric generation capacity in the U.S. since 2007 and is ahead of schedule to provide the 20% of our electricity by 2030. Wind already provides 20% of the electricity in Iowa and South Dakota -- and close to 9% on the main electric grid in Texas.
The PTC creates private investment. At this critical time for our nation's economy, we should not be contemplating a tax increase on an emerging energy industry that is growing new manufacturing jobs. Wind is proving itself as a commercial energy source, having accounted for more than a third of all of the new electric generating capacity installed in the past four years. Its lone incentive, a tax credit, has leveraged as much as $20 billion a year in private investment.
The PTC enjoys broad, bipartisan support. Legislation seeking to extend the PTC has 64 cosponsors including 16 Republicans. This legislation has received the endorsement of a broad coalition of more than 370 members, including the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, and the Western Governors’ Association. A PTC extension also has the support of the U.S. Chamber of Commerce and the bipartisan Governors’ Wind Energy Coalition, which includes 23 Republican and Democrat Governors from across the U.S.
Letters from the entire, bipartisan Iowa Congressional delegation and a bipartisan group comprising the majority of the Colorado delegation recently endorsed an extension of the PTC in currently ongoing talks surrounding the payroll tax credit extension. Republican Governors Sam Brownback of Kansas and Terry Branstad of Iowa also recently called on the conference committee to immediately extend the PTC.
Update, February 17, 2012: The New York Times has a story today on the payroll tax bill. It says in pertinent part:
"A compromise allowing the extension of the tax holiday for the rest of the year came together quickly this week, as Republicans decided it was not politically viable to resist in an election year. It avoided an abrupt increase in payroll taxes that would have taken effect March 1, returning them to the level of 2010. The taxes are withheld from the paychecks of most wage earners and finance the Social Security system." (emphasis added)--Tom Gray