Calling for a necessary transition to a low carbon energy economy, 83 CEOs sent a letter to President Obama demanding movement on cap and trade legislation to create green jobs. According to the press release, “the letter was signed by 83 CEOs from some of the nation’s largest electric power, manufacturing, clean tech, technology and consumer facing companies.”

Imagine that. The politically invested companies that stand to gain the most from cap and trade and spent millions to lobby this bill through Congress want to see it passed at the expense of American energy consumers and the American economy. This is no different than Archer Daniels Midland sending a letter to the president asking for an increase in the ethanol mandate.  Robert Bradley Jr. calls cap and trade the Enron Revitalization Act. He even includes a memo from Enron lobbyist John Palmisano about the Kyoto agreement to reduce greenhouse gas emissions:

If implemented, this agreement will do more to promote Enron’s business than will almost any other regulatory initiative outside of restructuring of the energy and natural gas industries in Europe and the United States. The potential to add incremental gas sales, and additional demand for renewable technology is enormous.”

Other than the direct beneficiaries, cap and trade is a raw deal for Americans, but that’s certainly not how the letter reads. The CEOs’ letter says, “This legislation will spur a new energy economy and with it create 1.7 million new American jobs, many in struggling communities across the country.” With enough subsidies and government mandates in place, cap and trade could ostensibly create 1.7 million jobs. But according to calculation from Heritage Foundation economists, cap and trade legislation would destroy far more jobs than the policy would create. The Center for Data Analysis study on the Waxman-Markey cap and trade bill found net job losses (after green job creation) approach 1.9 million in 2012 and could approach 2.5 million by 2035. Manufacturing loses 1.4 million jobs in 2035.

One example where this already happened is Spain. The country spends about $8 billion a year on green energy subsidies. The result is that for every green job created, 2.2 jobs were lost because so much money was taken out of viable parts of the economy and put into a more unreliable green market.

The free lunchers forget to take into consideration that subsidies and government handouts for renewable projects diverts those workers and resources away from more productive use. Moreover, a cap and trade policy will destroy more jobs than it creates. Because cap and trade is a tax on energy, the cost of producing goods for businesses increases, and consumer demand falls for two reasons; price hikes on goods reduce demand and people have less disposable income due to higher energy prices.

Higher energy prices force businesses to make production cuts and reduce labor. Furthermore, as we see in the current recession, reduced consumer spending only exacerbates this. The overall result is increased unemployment and slow economic growth. Jobs will either mover overseas or cease to exist. Smaller businesses that can’t absorb the costs or afford lobbyists will simply disappear.

And we’re not the only ones projecting losses. At a recent Heritage event on the costs of cap and trade, not one of the 6 speakers representing groups who modeled the bill, including the Environmental Protection Agency and the non-partisan Congressional Budget Office, discussed economic benefits from cap and trade – it was all about the magnitude of the losses.

The letter goes on to say, “We need strong policies and clear market signals that support the transition to a low-carbon economy and reward companies that innovate.” Take out the words “support the transition to a low-carbon economy and” and you have sound energy policy that would lead increase production, create jobs, and lower energy prices.