Matt Dempsey Matt_Dempsey@epw.senate.gov (202)224-9797
David Lungren David_Lungren@epw.senate.gov (202)224-5642
Higher Prices, Fewer Jobs and Weaker Economy With Cap-and-Trade, Says EIA
WASHINGTON, D.C. - U.S. Senator James Inhofe (R-Okla.), Ranking Member of the Senate Environment and Public Works Committee, today commented on the economic analysis of Waxman Markey by the Energy Information Administration.
“Once again, government economic analysis of a cap and trade tax bill shows Americans will pay more at the pump, in their homes, and in many cases, with their jobs – all for virtually no affect on the climate,” Senator Inhofe said. “It’s interesting that no matter what the costs, polls continue to show Americans unwilling to pay anything to fight global warming.
“My colleagues who support cap-and-trade don’t need to listen to me. I suspect they will be hearing plenty from their constituents back home who outright reject costly cap and trade legislation. The fact is, the more Americans learn about this bill, the more they oppose it.”
Key Excerpts from the EIA Analysis:
“ACESA increases the cost of using energy, which reduces real economic output, reduces purchasing power, and lowers aggregate demand for goods and services.”
“Implementing the ACESA GHG cap and trade program will affect the economy through two key mechanisms. First, the cost of using energy, particularly fossil fuels and electricity, will be increased by the requirement to submit allowances.”
“The higher delivered energy prices lead to lower real output for the economy. They reduce energy consumption, but also indirectly reduce real consumer spending for other goods and services due to lower purchasing power.”
“Ultimately, consumers will also see the impact of higher energy prices directly through final prices paid for energy-related goods and services and higher prices for other goods and services using energy as an input, and, if the cost increases cannot be passed onto consumers, labor and capital stock may be reallocated.”