The Obama administration, the Environmental Protection Agency and environmental activists frequently claim that climate change will disproportionately affect poor and minority communities.
This, they argue, justifies unprecedented environmental regulations like the EPA’s soon-to-be-finalized “Clean Power Plan” to cut U.S. greenhouse gas emissions by 30% by 2030.
But what effect will the regulation itself have on minority communities? A new study commissioned by my organization, the National Black Chamber of Commerce, answers this question.
The Clean Power Plan will lead to lost jobs, lower incomes and higher poverty rates for the 128 million blacks and Hispanics living in America. This should serve as a warning to federal and state lawmakers as they prepare for this sweeping regulation to go into effect in the coming months.
The underlying economics explain why this regulation will inflict the most severe harm on our communities.
The study estimates that restructuring America’s energy grid, which the EPA’s rule will require, will lead to $565 billion in higher annual electricity costs by 2030, when the regulation will be fully implemented.
With blacks and Hispanics spending a larger share of their income on energy than whites, the burden of higher costs will fall hardest on minorities. We will be hurt again through job losses, as businesses take steps to mitigate the damage of higher overhead.
The study estimates that this single regulation will cause cumulative job losses for blacks and Hispanics of roughly 7 million and 12 million, respectively, over the next 20 years. Over the same time period, black families can expect their annual incomes to fall by $455, while Hispanics will take home $515 less per year.
This regulation will also impose higher costs of living, which again hit minority families the hardest. Today, blacks spend 10% more of their income on housing, 20% more on food, 40% more on clothing and 50% more on utilities than do white families.
Similar disparities exist for Hispanics: 5% more on housing, 10% more on utilities, 40% more on clothing and fully 90% more on food.
By raising energy prices, EPA’s rule will make these essential items more expensive — knocking minority communities down another rung on the economic ladder.
These factors — fewer jobs, lower incomes and higher costs of living — threaten to impoverish millions. The study estimates that the regulation will increase black and Hispanic poverty by 23% and 26%, respectively. We work hard to provide a better future for our children, yet this regulation only pushes the American dream even further out of reach.
The only good news is that it doesn’t have to be this way. There are ways that states can mitigate, or altogether avoid, this regulation’s impending impact.
Already, more than a dozen states have sued the EPA over the rule, which faces legal opposition from experts on both sides of the aisle. Other states should join this suit.
State leaders could also refuse to implement the plan altogether. As currently written, the regulation calls on unelected state environmental agencies to draft their own state plans and submit them directly to the EPA for review and approval. Oklahoma Gov. Mary Fallin has signed an executive order blocking her state’s environmental agency from submitting a plan. Other states have introduced legislation to the same effect.
The grim reality is that the EPA wants states to do their dirty work for them. By submitting a plan, states will become complicit in the agency’s plan to shut down reliable power plants, impose higher energy costs and plunge minority families deeper into poverty.
For the sake of their constituents, elected officials have an obligation to fight this federal takeover of state authority.
Lawmakers in Washington and state capitals should act soon. The EPA is scheduled to release its final regulation next month, kicking off a one-year period before states will be forced to comply. As this deadline approaches, our elected officials should determine how best to confront — and resist — the Clean Power Plan. They should remember that the well-being of millions of minorities hangs in the balance.
• Alford is president and CEO of the National Black Chamber of Commerce.