Boxer Climate Tax - ‘Cap-and-Destroy’ - ‘Unprecedented Control’ By Gov’t – Round Up
June 3, 2008
Posted By Marc Morano – 5:16 PM ET – Marc_Morano@epw.senate.gov
Boxer Climate Tax - ‘Cap-and-Destroy’ - ‘Unprecedented Control’ By Gov’t – Round Up
Excerpt: Yesterday the U.S. Senate began what it insists on calling "debate" (more like serial dopey speeches designed for home consumption) on the worst piece of legislation introduced into that body in the new century. Perhaps worse than anything in the last century as well. There's nothing good to be said about the disingenuously named Lieberman-Warner Climate Security Act of 2008. A better name would be the Let's Destroy the Economy by Turning it Over to Left-Geek Bureaucrats in 2008 Act. The heart of Lieberman-Warner is a cap and trade system that would turn decisions on how much and what kind of energy to use in the private sector over to government. This is the approach, you'll recall, that worked so well in the Soviet Union that that dismal country's first five-year plan lasted 74 years before the whole sorry business caved-in on its own command and control butt. If adopted, this would be the most fundamental change in the nature of this country in the country's history. […] THE REASON A CAP and trade system is such a horrible idea, other than the fact that it would turn America's dynamic and complex economy over to the kind of folks who directed the Katrina relief effort, is that it sets very low levels of use of fossil fuels, the only relatively inexpensive, reliable, and available energy we have in large amounts. The boutique sources of energy like wind, solar, and biomass, the ones that excite environmentalists, just aren't available in more than trifling amounts. And aren't likely to be for years. Restricting the use of fossil fuels for energy would drive the price of everything -- not just gasoline or power to light homes, everything -- up dramatically. We've already seen increases in the price of food thanks to our insane policy of trying to grow our fuel through ethanol and other bio-fuels. If we're daft enough to cap our use of fossil fuels, as environmentalists and their political enablers want us to, we'll first see increased prices, then severe shortages, and finally unavailability of everything else as well. Choking off the use of carbon-based fuels could and would make an utter dog's breakfast of the American economy, which has been the most powerful engine of wealth the world has ever seen. […] WE'VE REACHED the "Do something even if it's wrong" phase. The Senate is seriously considering (seriously as these things are measured in Washington) creating a Department of Not Using Energy and saddling a dynamic and remarkably clean economy with it.
Excerpt: Depending on the outcome, history might look upon this Lieberman-Warner debate as the Boxer-Inhofe face-off. One feels that a near-recession is the perfect time to enact legislation that will drastically raise energy prices; the other sees the bill as a regressive tax that would end up doing the most financial damage to low-income Americans. In her opening remarks Monday, Committee chairperson Barbara Boxer (D-Calif.) said to her Senate colleagues, “Why do [Lieberman-Warner] now? We’re in a recession. Precisely because we’re in a recession is why we should be doing this. This bill is the first thing that brings us hope.” Isn’t it interesting that Boxer already views the nation in recession despite the gross domestic product having not yet experienced even a single quarter of negative growth let alone the consecutive two required to meet the textbook definition of such economic contraction? Why isn’t it surprising to find that the same folks who ignore scientific facts pertaining to the global warming debate also eschew financial statistics when speaking of the economy? […] Isn’t it fascinating that Boxer expressed similar concerns about posterity at her news conference Monday, as reported by the Associated Press? “It’s about our children, about their children, and about the planet we’ve inherited.” Yes, Senator, but this bill could make it difficult for some Americans to feed their children, a concern curiously shared by the Cleveland Plain Dealer in an editorial published Sunday: “The bill, as conceived, will just bore new holes into an already battered economy.” In fact, even the New York Times recognized the financial problems inherent in this bill, as evidenced by the first paragraph of John M. Broder’s piece published Tuesday: The Senate on Monday opened a raucous debate over climate change legislation even though it will put supporters of the bill, including all three presidential candidates, on the spot — essentially forcing them to come out in favor of high energy costs at a time when American consumers are paying record fuel prices. Yikes. If two left-leaning newspapers — both of which buy into global-warming alarmism hook, line, and sinker — recognize the economic perils inherent in enacting the Climate Security Act, Sen. Boxer is going to have a tough time making her sales pitch stick. Calling Lieberman-Warner “the first thing that brings us hope” is apparently just a tad too audacious.
Even under very conservative assumptions, Lieberman-Warner will cost the US economy 500,000 jobs by 2030. Traditionally union heavy sectors like manufacturing and energy production are the hardest hit. So how did environmental activists get unions like the United Association of Journeymen of the Plumbing and Pipefitting Industry to support carbon capping? The answer hearkens back to the world’s oldest profession: cold hard cash. Unions are signing on the the Lieberman-Warner bill because it is the largest tax increase in the history of mankind and liberals in Congress can’t wait to give away all that money to their favorite special interests. Sen. Barbara Boxer (D-CA) predicts the bill will allow her direct $3.32 trillion by 2050 to whoever she wants. To get unions to sign off on a bill that will kill their existing jobs, liberals in Congress are promising to use US taxpayer dollars to create new jobs just for unions. The Hill reports: “To draw in more labor support, Democratic leaders sweetened the pot. As revised by Senate Environment and Public Works panel Chairwoman Barbara Boxer (D-Calif.), the bill now includes language that applies Davis-Bacon, which requires workers be paid a prevailing local wage, to certain projects funded by the bill. It also would direct millions of dollars to “green-collar” training programs run by unions.”
A year after pitting herself against the world's leaders over climate change, German Chancellor Angela Merkel has backed down and gone silent on key environmental policies. It seems that the one opponent she can't bear confronting is the German voter. The German chancellor in Greenland: Once a hero to environmentalists worldwide, Angela Merkel is faltering badly on climate change policy. This is the so-called "climate chancellor?" This woman who, at the International Transport Forum in Leipzig, spoke enthusiastically about the nearby air freight hub, economic growth and the transport of goods? Who suddenly seems awkward and at a loss for words when it comes time to talk about climate protection? Who has stopped offering answers on the subject and only asks questions, like: Does it make sense to subsidize electricity from renewable sources? Is it fair to expect the owners of older cars with high CO2 emissions to pay higher taxes?
Excerpt: Friends of the Earth Action President Brent Blackwelder said, "We appreciate Environment and Public Works Chair Barbara Boxer efforts to debate global warming on the Senate floor, but feel the bill fails the most fundamental test: it doesn’t do what is needed to avoid catastrophic warming. "Groups outside of the traditional environmental community are joining our 'Fix or Ditch' campaign because they stand in support of at least two fundamental principles of any climate legislation — that polluters pay for 100 percent of their pollution credits through auction, and that Congress establish pollution reduction targets in line with the latest science.
Excerpt: The United States Senate is considering a bill that would give the federal government unprecedented control over the U.S. economy. […] The rent seeking opportunities under this system would be immense. Naturally, as Washington assumed these new wealth-allocating powers all economic participants would have a powerful incentive to hire lobbyists to influence policy. An inevitable result would be the suppression of competition as larger more influential companies seek to manipulate the system to their own advantage. If carbon emissions are the threat that so many in Washington D.C. say they are, why not propose a direct tax? Americans would at least be spared the burdens of the labyrinthine cap-and-trade system. A direct tax would also avoid the risks of corruption inherent in the cap-and-trade’s permit allocation process. A carbon tax would be a much more honest and direct way to promote energy-saving and carbon reducing technologies. But simplicity and honesty don't carry much value in the nation's capital. A carbon tax would be too clear and candid for our political masters. Politicians like to tax, but they prefer to tax indirectly, if possible. With the cap-and-trade regime, the government would be imposing a huge tax increase in the guise of permit transactions hidden within a bureaucratic maze. […] Many activists, special interests, and politicians have invested too much political capital to change course and government is always eager to expand its powers. Environmentalism is more than an ideology.
Excerpt: The Senate on Monday opened a raucous debate over climate change legislation even though it will put supporters of the bill, including all three presidential candidates, on the spot — essentially forcing them to come out in favor of high energy costs at a time when American consumers are paying record fuel prices. While the three candidates are on record favoring legislative action on global warming, the Bush administration opposes a far-reaching bill. [. . .] “Any action has to provide real protections for the American economy and jobs, and we must protect the American families,” said Senator James M. Inhofe, Republican of Oklahoma. “Any action should not raise the cost of gasoline or energy to American families, particularly the low-income and elderly who are most susceptible to energy costs.”
Excerpt: The Senate began what is expected to be a weeklong, contentious debate Monday over legislation to combat global warming by mandatory reductions in carbon dioxide and other greenhouse gases. Senators voted 74-14 to proceed to the bill, but immediately it became clear Republican opponents were not going to make it easy. A request by Democrats to begin considering substantive changes in the bill was blocked by GOP opponents until Wednesday at the earliest. [. . .] Republican leader Mitch McConnell of Kentucky called it "a giant tax on virtually every aspect of the economy," and accused Democrats of being "laughably out of touch" in taking up the bill when the country is reeling from $4 a gallon gasoline and other high energy costs. President Bush said at a White House event that the measure amounted to "a huge spending bill fueled by tax increases" and that it "would impose roughly $6 trillion in new costs on the American economy." White House spokeswoman Dana Perino said Bush would veto the bill as it stands, but said it seems unlikely the legislation will clear the Senate anyway. The White House maintained the carbon limits would "impose a huge new tax" while demanding "drastic emission cuts that have no chance of being realized and have every chance of hurting our economy."
Excerpt: The White House on Monday slammed legislation the U.S. Senate will consider this week aimed at controlling climate change, arguing it would cut economic growth and lead to soaring gasoline prices. "As you can imagine, our opposition to this will be quite strong and we'll be making these points throughout the week," Keith Hennessey, director of President George W. Bush's National Economic Council, said at a White House forum on the economy and taxes. U.S. gross domestic product could be reduced by as much as 7 percent in the year 2050 and gasoline prices -- already at record highs in the United States-- could soar by as much as 53 cents a gallon by 2030, he said. […] The Bush administration has consistently opposed an across-the-board cap-and-trade program for carbon dioxide, a greenhouse gas emitted by fossil-fueled vehicles and coal-fired industries, as well as by natural sources including human breath.
Excerpt: Although many supporters of Lieberman–Warner are quick to call attention to conclusions that show the least negative economic impact, they often fail to mention that the results depend on a massive expansion of nuclear power. For example, as noted by the Environmental Defense Fund, an Environmental Protection Agency (EPA) analysis concludes that economic growth would be minimally affected by Lieberman–Warner but makes no mention of the fact that this conclusion depends on a broad expansion of nuclear energy. It is not just that nuclear power is needed, but that a massive amount of nuclear power is needed in a relatively short period of time. The EPA analysis assumes a 150 percent increase in nuclear power by 2050. While meeting this demand would require a substantial industrial effort, it is miniscule in comparison to an Energy Information Agency (EIA) analysis that suggests that the U.S. must increase its nuclear capacity by 268 gigawatts of new nuclear power by 2030. These numbers must be put into perspective. The U.S. has 104 operating reactors today with a capacity of approximately 100 gigawatts. New reactors would likely be larger, on average, than existing reactors. Assuming that the average new reactor will produce about 1.3 gigawatts of electric power, the EPA analysis would require nearly 50 new reactors, while the EIA's analysis would require approximately 200 over the next 25 years.
Excerpt: When Ronald Reagan accepted his party’s nomination in 1980, he said that America’s energy policy was based on the sharing of scarcity, and that our great nation had to get to work producing more energy. “Large amounts of oil and natural gas lay beneath our land and off our shores, untouched because the present administration seems to believe the American people would rather see more regulation, taxes and controls than more energy, he said. “It must not be thwarted by a tiny minority opposed to economic growth which often finds friendly ears in regulatory agencies for its obstructionist campaigns.” When Ronald Reagan spoke these words he was describing President Jimmy Carter’s disastrous policies that ransacked family budgets, cost jobs and robbed Americans of hope. They could just as easily be spoken today about the Bush Administration, the Congress, and the candidates vying to become president this election year. On the energy front, it seems, the classically successful principles of less government and more self-initiative been replaced by a myth of resource scarcity and helplessness. Government now, as then, has created a massive energy problem. And now, as then, it wants people to believe it also has the solution. Well, as Reagan put it, “government is not the solution to the problem; government is the problem.” […]America is the Saudi Arabia of oil shale deposits. With the 2 trillion barrels of oil we could extract, the US could run for 250 years on that source alone. Unfortunately, the best deposits lie under nationalized lands in the West, and the Congress passed a law in 2007 making it illegal to lease the lands for energy development. Ditto for our coal resources; the US the Saudi Arabia of coal. Last year, Hollywood’s Henry Waxman slipped a provision into law that will block government – the biggest single user of energy – from buying any alternative fuels made from coal. Germany ran its war machine on the stuff throughout WWII, and South Africa has been making coal into substitute petroleum for decades. We could too, but for our government. Today, America only uses 3% of its offshore areas to produce energy, and only 6% of government lands onshore. The US now imports more oil than ever, produces less oil than it did before WWII, and is sending over half a trillion dollars a year to a lot of people who don’t like what our country stands for. Ronald Reagan’s stand that our nation’s future “should not be thwarted by a tiny minority opposed to economic growth.” Is as true today as it was when he uttered it 28 years ago. That tiny minority has hidden their agenda behind the environment movement and thus grown to control our nation’s energy decisions made in Washington, and it shows in every American’s energy bill.
Excerpt: The supposed purpose is to create an incentive to reduce carbon emissions. But incentive is not the problem. Cost and technology are the problems. Adding banking swindles to the cost does not make the technology more available. It's like increasing a person's incentive to make more money by robbing him in a dark alley. People already have enough incentive to make money. Robbing them only makes it harder for them to succeed. […] Why didn't Californians use less electricity when Enron reduced the supply and increased the price? That's what cap and trade is supposed to do—force people to use less electricity by reducing the supply and increasing the price, just like Enron did.
Excerpt: In an April 2008 white paper entitled, "Natural Gas and Electricity Costs and Impacts on Industry", the U.S. Department of Energy's National Energy Technology Laboratory (NETL) reported that opposition to new coal-based power plants is leading to a generation capacity shortage in many areas of the country and endangering U.S. energy security. The opposition is also inducing a "dash to gas" and quickly causing a rise in natural gas prices at a time when federal climate change legislation could immediately lead to a doubling of natural gas consumption for power generation. This legislation would increase the country's dependence on foreign energy sources in the form of liquefied natural gas (LNG) causing both natural gas and electricity prices to increase dramatically.
Excerpt: The gas station sticker shock of a holiday weekend should go far in raising public awareness for what many small businesses face every day of the week. And, after the summer driving season, when we start thinking about heating our homes and businesses for the winter, small business face rising energy costs that are far more alarming. Our research shows that small firms with fewer than 50 employees pay 35% more for electricity than their larger industry counterparts. When Congress returns from its own Memorial Day break, I hope they consider the disproportionately high energy and transportation costs faced by American small business owners. We should not be making it harder for small businesses to work their magic on our economy once again. Cost must be a key consideration for how our country tackles its energy needs.
Can we at least all agree that S. 3036, the Lieberman-Warner climate change bill, is all about raising revenues? (Specifically: Title IV, Auctions and Uses of Auction Proceeds.)
Well, then, the bill should not have been introduced in the Senate and it should not be debated there. Unless the U.S. Constitution has no meaning. U.S. Constitution, Article I, Section 7. All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.