All Biden’s Green Job Losers

But Stellantis, which formed through the merger of France’s PSA Group and Italian-American Fiat Chrysler, needs to come up with money to finance the more than $35 billion that it plans to invest in EVs over the next few years. Government industrial policy doesn’t give the company much of a choice.

Europe and several U.S. states have announced plans to ban the sale of new internal-combustion engine vehicles by 2035. Stellantis spent $2.4 billion to buy regulatory credits from

Tesla

between 2019 and 2021 to comply with green mandates. The Biden fuel economy mandates could force it to spend more unless it ramps up EV production.

The Inflation Reduction Act’s generous credits for battery production and EV buyers are modestly easing the costs of this government-forced transition. Many auto makers currently use profits from gas-powered SUVs and trucks to subsidize EVs that are losing money. They hope that sweetened government subsidies will eventually make EVs profitable, but in the meantime companies need to choose where to make investments and where to cut back.

Liberals pretend that the transition to EVs won’t come at a cost to workers or businesses. But taxpayers won’t foot the entire bill, which could cost hundreds of billions of dollars industrywide. Workers at Stellantis’s Cherokee plant are the collateral damage of this government-forced reallocation of capital. We’re waiting for Sens.

Sherrod Brown

and

Bernie Sanders

to plead for the workers here.

The United Auto Workers is denouncing Stellantis for laying off workers. “Not allocating new product to plants like Belvidere is unacceptable,” UAW President

Ray Curry

said. What did he expect? The union backed stricter fuel economy mandates and the IRA subsidies, even though its own studies showed the shift to EVs could cost 35,000 jobs.

Technological change disrupts markets and leads to some job gains and losses. But the problem here is that government is overriding market forces and picking the winners and losers. Auto makers’ enormous investments in EVs are largely being driven by political choices, not consumer choice. Politicians in Washington and state capitals, not business owners or executives, are calling the shots.

Labor dislocations caused by government climate subsidies and mandates will play out across the economy in the coming years. At least in the current tight labor market, most workers who lose their jobs can probably find new ones, though they may be lower-paying or require moving. But when government picks winners and losers, there are almost always more of the latter. The politicians don’t tell you about those.