Reward With One Hand, Punish With Another

President Obama gave remarks about the economy Friday at a manufacturing company in North Carolina. As The New York Times reports:

To highlight his economic agenda, he flew to Charlotte to visit Celgard, a firm that produces material for lithium batteries and has received $49 million from the stimulus program. The company is expanding its Charlotte plant and building a new facility in nearby Concord. Mr. Obama said the stimulus money was helping Celgard create 300 new jobs directly and as many as 1,000 new jobs for suppliers and contractors. 

It’s great the President chooses to highlight manufacturing. At the same time, manufacturers can remind him that the Administration is rolling an avalanche of regulations down upon the economy, burying the very industries he’s promoting.

Lithium batteries represent a good example. As previously noted, in January the Pipeline and Hazardous Materials Safety Administration [PHMSA]  issued a notice of proposed rulemaking [NPRM] to modify regulations that govern the shipping of lithium batteries and cells as air freight. The proposed regs require the batteries and battery-containing products be shipped as hazardous materials,  imposing unnecessary, anti-competitive and in many cases prohibitively expensive handling and packaging requirements.

Lithium-ion batteries are already hugely important in portable electronics and consumer goods, where just-in-time manufacturing and supply chain efficiencies are critical. The National Association of Manufacturers also discussed the impact of the proposed regulations on the electric vehicle industry in the NAM’s formal comments:

As the federal government encourages greater energy independence, the development of a lithium ion battery industry in the United States is more critical than ever. The PHMSA NPRM is totally inconsistent with national policy goals because the rule will make it more difficult and more expensive to ship large advanced batteries that are used for electric and hybrid vehicles and domestic energy exploration. Achieving a level playing field in the United States that keeps transportation services efficient and costs competitive is critical to the success of these larger policies intended to promote energy independence.

These considerations are just as important to the creation of jobs as the stimulus funding trumpeted by the President Friday in North Carolina.




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