Texas Insider

12:02 pm CST - July 06, 2009

Cap & Trade Bill Sets Stage for Self-Imposed Energy Crisis

By Gary Palmer

Passage of the Waxman-Markey cap and trade bill will create a self-imposed energy crisis that will have a devastating impact on families and businesses.

Even though cap and trade legislation was pushed heavily in the last Congress with the Lieberman-Warner Climate Security Act of 2008, few Americans grasp what “cap and trade” really means, much less how they will be affected.

According to a Rasmussen report released on May 11, 2009, 30 percent of Americans have no idea what cap and trade means; 29 percent think it has something to do with regulating Wall Street; and 17 percent think cap and trade is about healthcare reform.

Only 24 percent of the American public connect the term with the environment. In other words, more than two-thirds of the public would be completely blindsided by the regulations and costs of the Waxman-Markey cap and trade bill.

“Cap” refers to the limits the government will impose on the amount of carbon dioxide and other greenhouse gases that a company can release into the atmosphere. This cap would severely impact Alabama as over 76 percent of our energy comes from carbon-based fuel such as coal. (Fossil fuels such as coal, natural gas and oil emit carbon dioxide when burned.)

The “trade” part of the proposal references the mandates imposed by the federal government on businesses, forcing them to buy or trade for permits based on the amount of carbon dioxide they emit over the government-mandated cap. Ultimately, it is an elaborate tax scheme — increased energy costs will be passed on to American consumers, costing the economy millions of jobs and trillions of dollars.

The American Council for Capital Formation (ACCF) and the National Association of Manufacturers (NAM) issued a projection of the impact on Alabama’s economy if the Lieberman-Warner bill, which was more conservative than the Waxman-Markey bill, had passed. According to their analysis, Alabama’s economy would have lost between 17,000 and 25,900 jobs by 2020 and between 44,700 to 59,500 jobs by 2030. And the bill would have drained about $2 billion from our economy by 2020 and up to $8 billion by 2030.

In terms of household income, Lieberman-Warner would have reduced Alabama household disposable income by a minimum of $800 per year (up to $2,600) by 2020 and $3,400 (up to $6,300) by the year 2030.

At the national level, a new ACCF/NAM study of the Waxman-Markey bill reveals even worse news — projected job losses of 1,200,000 to 1,800,000 by 2020 and as many as 4,100,000 by 2030, above and beyond the new “green” jobs that will be created by the government’s renewable energy initiative.

Those who think these projections are conservative scare tactics should take note of a study entitled “Study of the Effects on Employment of Public Aid to Renewable Energy Sources,” published by Spain’s Universidad Rey Juan Carlos. The study researched the impact on employment as a result of the Spanish government’s efforts to create a green economy by subsidizing renewable energy.

According to that study, Spain’s renewable energy initiative is actually causing job losses at the rate of 2.2 jobs lost for every new “green” job created.

The study is highly relevant because Spain is often the country that President Obama cites as an example of the “green jobs revolution.” Based on the Universidad Rey Juan Carlos study, the job drain in Spain is very plain: the Spanish government’s attempt to create “green” jobs has resulted in thousands of workers getting “pink” slips.

Job losses are just part of the problem. The impact on household disposable income of Waxman-Markey bill is also extremely regressive.

A study published in March 2009 by the Tax Foundation projects the impact on household disposable income, based on a cap and trade system designed to cut U.S. carbon emissions by 15 percent of the 2006 levels. The cost to households with annual income over $88,774 is projected to be $2,091 per year, or 1.4 percent of their income. For households with incomes between $35,095 and $56,222, the annual cost will be $1,100 per year, or 2.4 percent of their income.

For households with annual income less than $18,370, the annual cost is $612 per year, or 6.2 percent of their income.

Those who claim a cap and trade scheme is a tax-free way to reduce greenhouse gases are either misinformed or deliberately being deceitful. Cap and trade is a tax of unprecedented size and scope that will fall most heavily on lower-income households in the form of higher energy costs and in the price of goods and services.

In other words, if the Waxman-Markey bill passes, the economic drain in jobs and income will not be limited to Spain.

Gary Palmer is president of the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.

8 Comments

CWJensen
1:48 pm CST
July 06, 2009

STOP this INSANITY
Start contacting SENATORS Today and everyday UNTIL we WIN.
If they DO NOT accept your e mails CALL or FAX
http://www.senate.gov/general/contact_information/senators_cfm.cfm

SJK
2:59 pm CST
July 06, 2009

This Cap and Trade bill is part ot Obama’s plan of the downfall of America! Our economy is going to continue on a downward trend as long as his programs continue to pass! Vice-President Biden , on the news today, stated that they underestimated how bad Bush’s economy that they inherited really was! They are not accepting the reponsibility of the present failing economy as Obama’s. The unemployment rate is probably going to go higher that 10% and these idiots don’t want that to fall back on this corrupt administration! We all know where the responsiblity of the economy’s downfall lies now! It is with Emperor Obama and his tax cheats and corrupt administration! They are still trying to snow the American people! I think the majority of us have seen the light! You can’t believe what comes out of their mouths!

brenda
4:10 pm CST
July 06, 2009

You know C.W. they look at the state and the zip code on the email. If you are not from their state, they kick it out. I look up a zip code in the State of the Senator or Rep. that I want to email, and I put that zip code and state in my address. There is more than one way to skin a cat!

Pam
5:38 pm CST
July 06, 2009

My understanding is that Kay Bailey is still straddling the fence on this. If I’m wrong, I apologize, but I have heard it in 2 places. If this is true, everyone needs to write her and call her. Unacceptable.

CWJensen
8:33 pm CST
July 06, 2009

Brenda ……………………………..I know I wrote the book but calling or faxing is even better.

a dumas
10:19 pm CST
July 06, 2009

Didn’t think it would take a Rasmussen poll to determine the majority of Americans are politically brain-dead. Putting Obama in the White House should be proof enough.

If this bill were truly about climate change, then why are offsets built in to allow no significant reduction of emissions until almost 2050? That amounts to kicking the global warming can about 40 years down the road. And, since you allowed 40 years to do something, why can’t the merits of global warming “science” even be debated before enacting this crippling legislation?

It is blatantly obvious that this bill h as nothing to do with impending planetary doom. It is simply a way to increase revenue without using the “T” word. Write your Senators (yes, Minnesota, you too can now use the plural) to vote against this obscene abuse of government power.

Barbara @ Scottsdale
7:12 pm CST
July 06, 2009

CAP AND TRADE BAD FOR BUILDING AND HOUSING MARKET
MOST IMPORTANT THE CONSTITUTION DOES NOT GRANT these POWERS to Congress.
THEY TOOK AN OATH/AFFIRMATION they WILL TO THE BEST OF MY ABILITY PRESERVE, PROTECT AND DEFEND the CONSTITUTION OF the United States.

The new legislation that passed through the House Friday night, unread by any of the Congress people, had inserted into the bill a new NATIONAL BUILDING CODE. There is language that would have a national building code override your local and state codes.

Bill H.R. 2454 would allow the federal government’s power to supersede state and local building codes… By 2012 it requires that of new buildings be 30 percent more efficient than they would have been under current regulations. By 2016, that figure rises to 50 percent, with increases scheduled for years after that. With those targets in mind, the bill expects organizations that develop model codes for states and localities to fill in the details, creating a national code. If they don’t, the bill commands the Energy Department to draft a national code itself.

In the meantime states would have to adopt the national code or one that achieves the same efficiency targets. Those that refuse will see their codes overwritten automatically, and they will be docked federal funds and carbon “allowances” — valuable securities created elsewhere in the bill that give the holder the right to pollute and can be sold. The Energy Department also could enforce its code itself. Among other things, the policy would demonstrate the new leverage of allocation of allowances as a sort of carbon currency — leverage this bill would be giving to Congress to direct state behavior. washingtonpost.com.

H.R.2454
SEC. 304.
LINK: http://thomas.loc..gov
GREATER ENERGY EFFICIENCY IN BUILDING CODES
(b) National Energy Efficiency Building Codes-
(1) REQUIREMENT-
(A) IN GENERAL- There shall be established national energy efficiency building codes under this subsection, for residential and commercial buildings, sufficient to meet each of the national building code energy efficiency targets established under subsection (a), not later than the date that is one year after the deadline for establishment of each such target.
`(A) effective on the date of enactment of the American Clean Energy and Security Act of 2009, 30 percent reduction in energy use relative to a comparable building constructed in compliance with the baseline code;
`(B) effective January 1, 2014, for residential buildings, and January 1, 2015, for commercial buildings, 50 percent reduction in energy use relative to the baseline code; and
`(C) effective January 1, 2017, for residential buildings, and January 1, 2018, for commercial buildings, and every 3 years thereafter, respectively, through January 1, 2029, and January 1, 2030, 5 percent additional reduction in energy use relative to the baseline code.

This bill would:
1. Increase building costs

2. Increase appraisal costs Increase inspection lead times before a home can close. You think it is bad now with HVCC just wait until this bill passes.

3. Require every appraiser is retrained to understand these new federal energy efficiency guidelines. Who pays?
4. Increase mortgage costs.
5. Reduce home sales
6. Increase regulations in areas that are in flood zones and exposed to hurricanes.

7. Confuse everyone, the government doesn’t know what they are doing and Congress and the Senate have no clue what they are doing.
CONTACT YOUR SENATORS TODAY AND ASK THEM TO VOTE NO.

LCook
8:54 pm CST
July 06, 2009

I very distinctly remember back in the 50’s the Communists said they would take over this country by doing 3 things: 1. They would flood the market with pornographic literature. 2. They would stop all transportation. 3. They would disarm the people. So far this year the Democrats are pretty accurate, aren’t they?