Unemployment at 10.2%; House Votes to Add Business Burdens

By November 7, 2009Economy, General, Regulations

The House of Representatives on Friday passed H.R. 2868, the Chemical Facility Anti-Terrorism Act, by a vote of 230-193. Twenty-one Democrats joined all the Republicans in voting no. (Roll call vote.)

There were two chief arguments made on the House floor yesterday against the legislation:

  • The bill’s mandate that facilities use Inherently Safer Technology (IST) will add substantial costs and burdens to business, create unintended consequences, and do little if anything to improve chemical facility security.
  • Unemployment is at 10.2 percent. What we in the world are we doing?

Leading the opposition to the measure was Rep. Charlie Dent (R-PA), the ranking member on the House Homeland Security Committee, Subcommittee on Transportation Security and Infrastructure Protection. From his statement on the motion to recommit, Page H12533.

Now, there are plenty of reasons to oppose the inclusion of any IST mandate in this bill; it’s a vague and subjective philosophy that will cost facilities millions of dollars. The Department has no experts on IST, inherently safer technologies, nor any plans to hire them. And it’s not really even about security at all.

But the worst part of the IST mandate is that nowhere in the current bill is the Secretary required to consider the impact on the local economy and on the local workforce before imposing these unnecessary requirements. This is simply unimaginable in the current economy. Unemployment is now at 10.2 percent.

The agricultural sector, much of which will now be regulated under this bill, has an unemployment rate of over 11 percent. Perhaps that’s why agriculture groups, including the Farm Bureau and others, warn that IST “could have a devastating impact on American agriculture.” That’s the Farm Bureau’s words, not mine.

Mandating implementation would result in increased costs, higher consumer prices, and lower crop yields. And for those of you who say that sector will be exempt, I say prove it. That’s not true. That’s not in the legislation. If it is, just tell me which page to turn to in here, and we’ll try to find it. It’s not in here.

The cost of mandating IST is staggering. Twenty-seven associations, including the U.S. Chamber of Commerce, stated that the costs are estimated to range from thousands of dollars to millions of dollars per facility–millions of dollars. Almost 60 percent of the facilities regulated under this act employ fewer than 50 individuals. These are the smallest of small businesses. Do we really think they can afford to put millions of dollars into the redesigning of processes and facilities during these difficult economic times?

We know the reality of these expenses. When the cost of doing business goes up, there are only two options: you can pass the cost on to consumers, or you can lay off workers. In today’s competitive market, unfortunately, it is much easier to shed a few employees than to raise prices. You know it, I know it, and the American people know it.

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