May
19
Cap And Trade Becomes Transfer of Wealth
May 19, 2009 | 6 Comments
The swindle of the decade called Cap and Trade, which is a dopey idea to reduce carbon dioxide emissions, has regressed into common transferring of wealth from some to everyone else. Or as Jack Gerard at the American Petroleum Institute put it on May 15th, “. . . its inequitable system of allocations will have a disproportionate adverse impact on consumers and producers of gasoline, diesel fuel, jet fuel, crude oil and natural gas. Those who drive, fly or take the bus or train to work will shoulder a disproportionate burden. . .” Add to that Indiana Governor Mitch Daniel’s thought, “Quite simply, it looks like imperialism. This bill would impose enormous taxes and restrictions on free commerce by wealthy but faltering powers — California, Massachusetts and New York — seeking to exploit politically weaker colonies in order to prop up their own decaying economies.” Daniel’s concern comes from the preferential distribution of the “free credits that can be traded” loaded to go to the northeast and California to be sold to the rest of us.
It’s a mess of gross unfairness setting up the economy for a disaster based on faulty science.
The past days have seen the Waxman committee engage in the horse-trading Congress is famous for by buying out the opposition with preferred treatment. Naturally someone else pays for the freebies. Just to aggravate the horse-trading into a swindle the trade angle of the proposed law would make those with preferred treatment positioned to profit from others.
That “in the closet” trading among legislators is where the worst possible law is written. As it sits now, the bill would give free credits to some, such as Waxman’s home state of California and the Democratic strongholds of the northeast that they can trade (for cash) to those such as the more Republican territory in between. It’s a House of Representatives classic case of the dense population centers foisting their wishes to be paid for by everyone else.
It’s a grim situation, even though very few people grasp what’s at stake. Cap and Trade is nothing but a method to extract government revenue from energy. All the machinations within the proposal do is hide the effect – you are going to pay a great deal more money for energy, be it fuels for transport or electricity.
The money involved, that which the government, at various estimates, ranges beyond $500 billion to closing in on $1 trillion dollars. You’ll note that the trillion number isn’t bandied about by anyone yet, but its out there, noted or not. Cap and Trade would get there quicker than any one can imagine. All those dollars flowing into the government are going to come from consumers – count on it, it’s a guarantee. It will be added to your fuel and energy costs.
The lobbying war is about preferred treatment – who can get an advantage in a sea change of the economy. Businesses who are at the front line, paying the government for the tradable credits know, and so do we, that those costs will get passed on to customers. They also know the costs to administrate will gets folded into prices as well. They have nothing to lose – so the lobbying fight is about advantages, where to make a dollar. Citizens and consumers used to have a little protection from lenders who might shoulder some risk, or boards of directors who answer to stockholders. The credit crises and lawsuit and insurance concerns have essentially silenced them.
Meanwhile the media and press have put legs under the whole stupid idea of CO2 as the curse of the planet. One anonymous party suggested a law requiring any proponent of global warming to be required to breathe through CO2 trapping filters with no CO2 coming in or going out. One might add no carbon allowed in their foods. They would all be gone in just weeks.
Gallows humor aside (some are getting more serious now), the international community is waking up to the sensational stupidity. Jim Prentice, Canada’s Minister of the Environment no less, visited Washington last week to warn in no uncertain terms that the proposal before Congress would be a “prescription for disaster” for U. S. trade relations. That’s a reference to “border tax adjustments” included in the U. S. bill, which would impose charges on goods imported from countries that do not match U. S. efforts to reduce emissions. No news making comments from China, India, Mexico and others, yet. But the Europeans seem to be in the cheering section; perhaps with a little ill will towards the Americans on their minds, tempering their own disaster in carbon mismanagement.
President Obama has expressed reservations about the border charges. Republicans have pointed out that any costs added to imports will inevitably be passed on to U. S. consumers. But there is no guarantee either will be able to halt a Democratically controlled Congress bent on feathering its own nest. This what a single party system will get ‘ya.
Efforts to contain CO2 emissions seem prone to this sort of flim-flam. The Democrats’ awesome determination to use global warming is a cover-up for a transfer of wealth from one part of the country to another.
It’s unfortunate but not surprising. The climate debate is wrapped up in emotions, posturing and evangelical zeal to cover the money grab, it makes a natural habitat for politicians on the make.
But the money to be taken from us is ours, and the Senate is made up of 2 per state, not power centered on population. There are Democrats in the Senate that can bring this to a halt, but they’re going to have to hear a great outcry. If you miss the timing the bureaucracy may get established and we’ll be paying huge sums for nothing forever.
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A recent MIT report calculated it would cost $3100 per year per household. That’s another car payment folks.
The first thing we’ll see are Coal Power Plants built just across the boarder in Mexico and Canada.
It will also push manufacturing (energy intensive) across the boarder.
NAFTA + CAP & TRADE = Bye Bye American Manufacturing. Bye Bye American Jobs.
This move will re-energize NAFTA and encourage another wave of Jobs to flow like a tidal wave out of the US.
Matt’s right. Other studies come in above and below the MIT one, but experience tells us once law is started the pre passage estimates always come in low.
The job matter may well push much harder than thought, it will be fossil energy based shifts which destroy more sectors than just low cost labor.
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