Costs Pile Up for Cap and Trade Proposal
Washington--On June 25, the House passed the Waxman-Markey climate stabilization act, that sets up a' cap-and-trade' system to restrict Americans’ carbon emissions. In the days after the 7-vote victory the hidden costs of the legislation are surfacing by the hour and showing faulty math.
Even the bluest economists have a hard time conceding American families would pay just a few hundred dollars a year in what amounts to a massive carbon tax. Some of the costs could be recovered in a carbon trade market, but the Obama administration has failed to take into account the basics of trade speculation. Theres no limit or even control on how much a carbon credit can be sold for (try buying a tickets to the Boise State-Oregon football game), it's supply and demand and speculators stand to make billions while many Idaho families will struggle to raise a few extra thousand dollars a year.
Representative Walt Minnick told Dan Popkey of the Idaho Statesman that he opposed the bill, because the sale of pollution credits could be controlled by the aforementioned speculators who've put oil prices on a roller coaster.
The bill also penalizes hydroelectric production and doesn't do enough for nuclear power, Minnick said. "Nuclear has to be part of our solution in the near term. There is no way that other forms of green energy will come on fast enough, even with substantial subsidies, to put any measurable dent in our fossil-fuel production over the next 25 years."
MIT did a study last spring and estimated the cap and trade market would be worth $366 billion in revenue. That revenue would be paid by those who purchased the credits and then passed the cost along to the consumers in the form of higher prices for power, fuel, and manufactured goods. If you divide $366 billion by 300 million households, the cost per household is $3,128. That bill supposed the federal government would return a portion of the money to the consumers while keeping a portion for research on energy related technologies.
All said, there are lessons to be learned. Other countries have tried caps and trade and failed. Spain went cap and trade years ago and for every “green job” created, two regular jobs were lost. Also global warming has disappeared in the past year, and is now known as climate change. The reason is that the earth is not warming, at least not in a way caused by humans. Actually the planet has not warmed in 8 years. In fact, the EPA recently said earth is going to have a temperature decline for the next twenty years.