Tom Borelli

President Obama launched the New Year by blasting an unpopular Congress.

Following Obama’s successful outmaneuvering of Congressional Republicans over the payroll tax cut the President rammed through a recess appointment for Richard Cordray as head of the Consumer Financial Protection Bureau.

By securing an estimated $40 a paycheck for the average family and appointing a consumer advocate, Obama is marketing himself as the savior of hardworking Americans by rescuing them from an ineffective Congress and Wall Street.

There is little doubt that economic issues will be a main factor in the 2012 election. Picking fights with Congress to highlight the President’s effort to help the “little guy” is a cornerstone of Obama’s re-election bid.

While the President is currently scoring short-term political points, his strategy may backfire if Republicans use the upcoming debate over the extension of the payroll tax cut to challenge Obama’s war on fossil fuels. They can do this by adding a pro-energy reform as part of the deal.

Obama’s war on fossil fuels is a big vulnerability for the President because it harms the prosperity of hardworking Americans. The issue illustrates the stark difference between what Obama says is good for average Americans and the reality of his policies.

High energy costs are an economic matter for Americans of every political persuasion. While Obama talks a good game regarding the welfare of hardworking Americans, his policies that raise energy prices will burden many families. Rising gasoline prices alone could easily negate the $40 tax savings from the payroll tax cut, but the Administration’s policies are unnecessarily pushing electricity prices higher as well.

All by itself, President Obama’s assault on coal – expected to be a main cause of predicted electricity price hikes -- may have major implications for his re-election bid and the Democratic Senate majority.

Coincidently, key presidential swing states, including Michigan, Missouri, Pennsylvania, Ohio and West Virginia, derive over 45 percent of their electricity from coal – with some of these states generating over eighty percent of power from this source. Critically for Republican legislators looking for a way to recruit Senate Democrats to support lower-price, pro-energy reforms, each of these states also has Senate Democrats running for re-election.

With coal, Obama’s EPA is doing almost everything possible to bring about the President’s promise to make electricity prices “skyrocket.”

While Obama was pivoting around House and Senate Republicans with the end-of-year politics surrounding the payroll tax cut, EPA Administrator Lisa Jackson was issuing the Utility MACT Rule – the most expensive regulation ever issued by the agency. According to the EPA, this rule will cost utilities almost $10 billion a year. Which is why it can’t help but cause substantially higher electricity prices for consumers.

The Utility MACT Rule and another new Obama Administration regulation, the Cross State Air Rule, both of which target coal-fired utilities, are estimated to result in up to double-digit utility rate increases and a loss of 1.4 million job-years by 2020.

Electricity price increases are being reported nationwide as a result of the EPA's actions. In North Carolina, Duke Energy is seeking rate increases of 14 and 17 percent for households and businesses respectively, in Louisiana rates may go up 25 percent and in Chicago the rates may spike up to 60 percent.

Refusing to approve the construction of the Keystone XL pipeline and the creation of an estimated associated 20,000 jobs (with the additional benefit of increasing our oil supplies from Canada at a time when Iran is rattling its saber) is but one example of the destructive nature of Obama’s energy policy.

In contrast, Congressional Republicans have consistently fought EPA’s overreach and, accordingly, have been on the right side of economic prosperity and the interests of lower and middle class citizens.

In addition to pushing for the construction of the Keystone pipeline, House Republicans, in a bipartisan effort, passed the Transparency in Regulatory Analysis of Impacts on the Nation (TRAIN) Act of 2011 to slow down the EPA’s assault on our economy and coal-fired utilities.

In the Senate, Rand Paul (R-KY) led an unsuccessful effort to use the Congressional Review Act to stop the Cross State Air Rule. Senator Paul’s effort to stop the Cross State Air Rule was vindicated, as a federal court recently blocked the rule and its outcome will be determined later this year.

This presents reform-minded Republicans with an opportunity. If they attach a reform proposal, such as the TRAIN Act, to a high-profile issue such as the upcoming debate over the extension of the payroll tax cut, they can educate the voters in these states about the impact of Obama’s energy policies on their wallets.

Debating the pros and cons of the TRAIN Act would expose Obama’s role in driving electricity prices higher and apply pressure to Congressional Democrats to support pro-energy, lower-price reforms.

If Congressional Democrats recognize Obama’s attack on Congress provides meaningless benefits for their constituents while the President’s war on fossil fuels threatens their political future, they may resist being thrown under the President’s bus. After all, Democrats are part of Congress and, in fact, they control the Senate.

Given the political risk facing some Senate Democrats and Obama’s eagerness to run against Congress, Republicans might find some surprising support to stop Obama’s assault on fossil fuels.


Tom Borelli

Tom Borelli, Ph.D., is a Senior Fellow with FreedomWorks.

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