Examiner Editorial: Cap-and-trade scheme will wreck economy
Examiner Staff Writer
May 18, 2009
House Energy and Commerce Committee Chairman Rep. Henry Waxman, D-Los Angeles, has teamed with Rep. Edward Markey, D-Mass., chairman of the House Select Committee on Energy Independence and Global Warming, to produce the latest in a series of cap-and-trade bills designed to reduce carbon dioxide emissions.
Such emissions are produced when carbon-based fuels such as petroleum and coal are burned to create energy to run electric power plants, automobiles and air conditioning systems, among others. These emissions must be reduced because they are allegedly causing the Earth’s atmosphere to heat up, thus producing all sorts of lethal consequences — not excluding death, destruction and the Final Apocalypse of All Mankind.
The problem for such advocates, however, is that Earth’s average temperatures have been declining for a decade, and a fast-growing number of climate and other scientists now question the root idea of a global warming crisis. These critics are increasingly banding together with elected officials and other experts in the public policy arena who see cap-and-trade schemes like Waxman-Markey as fatally flawed on two counts.
First, the government, under Waxman-Markey, would establish a schedule of emissions reductions — 70 percent by 2030 — and a program of “credits” for businesses that meet the schedule. Those that don’t meet it can buy credits from companies that do, thus satisfying the mandate.
Europe’s similar cap-and-trade program has been in effect for five years, yet no measurable impact on global temperatures has been recorded. The U.S. effort is likely to fail, too, for the simple reason that developing nations, particularly China and India, aren’t going to hobble their expanding economies, which will depend on carbon-based fuels for the foreseeable future. Thus, at best, Waxman-Markey will reduce average global temperatures by much less than 1 degree.
That reduction highlights the second flaw, which is the excessive cost of achieving virtually no reduction in temperatures. The conservative Heritage Foundation’s Center for Data Analysis used an econometric model of the U.S. economy to measure the projected impact of the bill and found that by 2035 it would:
- Reduce aggregate gross domestic product by $7.4 trillion;
- Destroy 844,000 jobs on average, with peak years seeing unemployment rise by more than 1,900,000;
- Raise electricity rates 90 percent after adjusting for inflation;
- Raise inflation-adjusted gasoline prices by 74 percent;
- Raise residential natural gas prices by 55 percent;
- Raise an average family’s annual energy bill by $1,500;
- And increase inflation-adjusted federal debt by 29 percent, or $33,400 more per person — again after adjusting for inflation.
That’s a prescription for wrecking American prosperity for decades to come.
