# 497  

October 2003

Hispanic Economic Progress Endangered by McCain-Lieberman

by David W. Almasi

Hispanics, who have become America's largest minority,1 are in the midst of an economic renaissance. Unemployment is at a record low while poverty is falling dramatically. Hispanic businesses are growing at a rate of four times the national average.2

This progress, however, is at risk.

Legislation in Congress designed to address global warming by regulating American businesses would hurt everyone with higher prices, lower wages and unemployment.

According to a just-released study conducted by Management Information Services, a national economics firm with clients representing both business and environmental organizations, if a bill being pushed by Senators John McCain (R-AZ) and Joe Lieberman (D-CT) is adopted, Hispanics will find themselves hurt the most.

The "Climate Stewardship Act" (S. 139) would require many American businesses to reduce their airborne emissions of greenhouse gases - mostly carbon dioxide. The proposal is similar to the U.N.'s Kyoto Protocol. In 1995, the U.S. Senate - including both McCain and Lieberman - voted 95 to 0 to voice opposition to Kyoto because of the harm it would cause the U.S. economy.3

Furthermore, data collected by weather balloons and satellites, the most accurate means of collecting temperature readings, adds no credence to claims by the bill's supporters that industrial actions are causing our atmosphere to heat unnaturally.4

Essentially, the McCain-Lieberman bill is a frenzied run toward economic ruin -- facts be damned. And good luck to those unprepared for the disastrous economic consequences.

Indicators measuring the economic progress of America's Hispanic community show Hispanics are on the upswing from terrible economic lows just decades ago. Nevertheless, the Hispanic community remains at the bottom of America's socioeconomic ladder.

Enacting tough emissions restrictions on businesses will force everyone to tighten their belts, but there aren't any more notches left on the belts of many Hispanic families.

According to the federal Energy Information Administration, the McCain-Lieberman bill would raise electricity prices by nine percent by 2010. The price of natural gas would rise by 16 percent, fuel oil by 14 percent and gasoline by 13 percent. Unemployment would rise by nine percent, and inflation by 27 percent. On average, people will lose $2,800 each in disposable income.5

It will be a lot worse in the Hispanic community, says the Management Information Services study.

Because the Hispanic community is just still economically vulnerable, they are the most likely to be hurt by McCain-Lieberman. Unemployment among Hispanics, already almost twice the national average, could go up another 30 percent by 2010. That's roughly two million jobs lost, which will be particularly hard on young Hispanics who comprise a quarter of all new workers. This increased unemployment would also likely result in 40 percent of Hispanics being without health care coverage.6

Hispanic earnings would fall by an estimated ten percent by 2016 under McCain-Lieberman. Poverty rates would soar to levels unseen since the 1980s. While the average Hispanic household already spends 23 percent more of their income on food, ten percent more on utilities and twice as much on rent in proportion to their average white counterparts, McCain-Lieberman would make food, housing, utilities and transportation alone consume 84 percent of a Hispanic family's income. This leaves little for things like clothing and education.7

Energy prices would likely double for Hispanic families.8 It may come to a point where some families are forced to choose between heating and eating - to solve a problem yet to be properly diagnosed.

Richard Martinez, a former county commissioner in Resugio County, Texas worries about these proposed global warming regulations. "The mostly Hispanic citizens I represented want to work and they work hard," he said. "This bill would put a lot of hard workers on welfare, and hurt the incomes of those who manage to hold onto a job. Protect the environment, fine, but we have to protect the economy as well."9

Frivolous legislation isn't new to Washington, but rarely has it been predicted to come at such a heavy price to such a vulnerable segment of our population.

The U.S. Senate has been clear in its rejection of the economic damage that would be wrought in the U.S. by adoption of the Kyoto global warming treaty, voting 95-0 that "the level of required emission reductions could result in serious harm to the United States economy, including significant job loss, trade disadvantages, increased energy and consumer costs."10

When it comes to McCain-Lieberman, they would be wise to renew their skepticism.

# # #

David Almasi is executive director of The National Center for Public Policy Research, a Washington, D.C. think tank. Comments may be sent to [email protected].


1 Haya El Nasser, "39 Million Make Hispanics Largest U.S. Minority Group," USA Today, June 19, 2003.

2 "Hispanic Economic Prospects Depend on Education and a Strong Economy," Pew Hispanic Center, Washington, D.C., January 2002.
3 Roll call vote record for Senate Resolution 98 (105th Congress), available at http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=105&session=1&vote=00205 as of October 28, 2003.

4 Amy Ridenour, "Inhofe Challenges Colleagues to Understand Basic Facts About Climate Change Debate," Ten Second Response, The National Center for Public Policy Research, Washington, D.C., July 29, 2003, available at http://www.project21.org?TSR72903.html.

5 "Potential Impact on Hispanics of S. 139, The McCain-Lieberman Bill," Management Information Service, Inc,, Washington, D.C., September 2003, pp. 2-3, available at http://www.balancedenergy.org/hispanicstudy/index.asp as of October 28, 2003.

6 Ibid, pp. 6-8.

7 Ibid., pp. 6, 10.

8 Ibid., p. 11.

9 "Hispanics Hit Hard by McCain-Lieberman Bill," Americans for Balanced Energy Choices," Alexandria, Virginia, October 22, 2003, available at http://www.balancedenergy.org/hispanicstudy/index.asp as of October 28, 2003.

10 Text of Senate Resolution 98 (105th Congress), U.S. Senate, Washington, D.C., available at http://www.nationalcenter.org/KyotoSenate.html.

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