Energy & Environment

House Begins ‘Cap and Trade’ Hearings

Hearings began Tuesday afternoon in the Energy and Commerce Committee on the “American Clean Energy and Security Act,” otherwise known as the “Cap and Trade” legislation.  

A new House Republican Conference paper said of the Waxman-Markey bill,  “…there are no specifics on how CO2 emissions allowances would be allocated to energy producers — in other words, will they be free or auctioned, and at what price.  Therefore, the bill provides little for the Congressional Budget Office (CBO) to use to calculate its economic impact.  However, in contrast to the details which are conveniently left out of the bill, there are plenty of details on how the plan increases energy prices, strains the economy, reduces jobs, and intrudes into private citizens lives.”

The paper highlights how much of a job-killer the bill is and the weak Democratic effort to forestall even part of that effect.

At his weekly pen and pad session with reporters, I spoke with Rep. Mike Pence of Indiana, chairman of the House Republican Conference, about the summary and this massive carbon tax legislation.

“According to a study by MIT, the average American household will be facing $3,128 in additional utility costs per year,” Pence said.  “I should add that’s an average.  They took more than half a trillion dollars in anticipated revenue base and divided it by number of American households.  That ain’t how it’s gonna work as we sometimes say south of Highway 40.  It’s gonna hit the hardest on people dependent on coal burning.  What we’re looking at here is a massive national energy tax and the American people deserve to consider it with all of the numbers out there on the table.”

Pence also discussed regional disproportionality of the tax scheme and other extensive information produced by the Heritage Foundation which breaks out the impact of the carbon tax legislation by state and congressional district (http://www.heritage.org/cda/).

“When you’re talking legislation that essentially amounts to a declaration of economic war on the Midwest by liberals on Capitol Hill.  The American people are entitled to know how much that is going to cost them and future generations,” Pence said.  “There are a lot of issues that break along partisan lines, and some break along ideology lines, and other ones are like the chicken and the pig going to a ham and egg breakfast.  The chicken makes a contribution, but the pig’s a little more involved.”

Pence added, “It was startling to me when I became aware of the impact.  I don’t use terms like declaration of economic war on the Midwest loosely.  This would represent an enormous transfer of wealth.  Last week we just got word that Indiana’s got a 10% unemployment rate.  The Midwest is struggling and the idea that in the name of dealing with global climate change that we would drop the burden not only inordinately on Americans as a whole leaving places like India and China completely out of the discussion, but that we would focus the main economic impact on the Midwest is something that the American people are entitled to know.”

President Obama, as a candidate for the office, told the San Francisco Chronicle that his cap and trade tax plan would necessarily cause electric bills to skyrocket.  The House Republican Conference folks have located the video of this interview and will make it available shortly on their website.

Pence showed the video in which Obama told interviewers in the January, 2008 video, “Under my plan, the cap and trade system, electricity rates would necessarily skyrocket even regardless of what I say about whether coal is good or bad because I’m capping greenhouse gasses coal power plants, natural gas, you name it, whatever the plants were, whatever the industry was, they would have to, uh, retrofit their operations.  That will cost money; they will pass that money on to consumers.”

Pence told me in reaction to the video, “We don’t believe that a draconian national energy tax dropped on top of a coal-burning industry principally that — according to the President of the United States last year — will cause utility rates to ‘skyrocket’ is the right approach. … Since we arrived on Capitol Hill we’ve heard a lot of good things about working together and what we have seen is the opposite.  What we have seen is closed rules, limited amendments, last minute introduction; we’ve seen massive, hundreds of billions of dollars of legislation that’s been brought to the floor — twelve hours to review it, twenty-four hours to review it.  Our concern would be that the American people are entitled to count the cost of this cap and trade legislation and not wait until the day before the bill comes out of committee and goes to the floor and passes to be told what it will cost.”

Rep. Marsha Blackburn (R-Tenn.) as a member of the Energy and Commerce Committee working on this legislation as the hearings commenced spoke with HUMAN EVENTS about the devastating affect this sort of carbon tax has had on countries in the European Union and the impact this would have on American jobs.

“When you look at what has happened in Europe and they have basically given up their manufacturing and their production base,” Blackburn said.  “When you go there you don’t see a lot that’s being done with cement, with ores, with metals, with steel.  That is a void in their economy.  You go to places like Denmark and they talk about wanting to move toward having everybody buy their own individual carbon credits that they use every year and that is taxing the very air you breathe.”

The MIT study that produced the average annual cost to consumers of $3,128 per household in increased energy cost alone also produced staggering numbers of job losses from this carbon tax scheme.  

“The increased cost was not only in the tax that would be paid but also in the loss of jobs:  3 to 6 million American jobs through the same study,” Blackburn said.  “[The Democrats] tout that this would create 2 million clean energy or green jobs, but our concern is that it would be a net jobs loss for the economy on top of the increased tax per household.  We’re all for clean air, we’re all for clean water, we are all for clean energy.  We are for conservation and taking good care of this planet that we live on, but we are not for taxing people out of house and home in order to pay for some of these programs that they are wanting to bring forward.”

Former Vice President Al Gore is slated to testify before the hearing on Friday.

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