Obama Cap-and-Trade: A Tax We Can’t Afford

The Obama administration is backing a bill going through Congress (Waxman-Markey) that would cap U.S. Co2 emissions at 83% of 2005 levels by the year 2020.

While this is an idea that sounds good to the politician, it is a policy move that will severely tax the American people, it will cost American jobs and it will do little to reduce global carbon emissions.

The U.S. Congressional Budget Office has estimated that it will cost the average American household $1,600 per year to reduce CO2 emissions by 15%. American families are struggling as it is. It will increase the prices of American-made goods, causing us to lose more jobs. It will shift production overseas to countries (like China) that have no restrictions on CO2 emissions. It may even increase overall global Co2 emissions, the opposite of its intent.

At this time, U.S. carbon emissions represent about 25% of global emissions. A 15% reduction represents about a 4% drop in world CO2 emissions, assuming the products are still made in this country. However, the tax (yes, it is a tax) would cause more overseas production, in areas that pollute many times more than we do for the same output. The net result will be a lower U.S. wage base, more unemployment and no less global pollution.

In reality, this bill represents little more than a power grab by Washington, giving politicians the ability to trade CO2 credits for votes. Nothing more.