Among the issues most commonly discussed are individuality, the rights of the individual, the limits of legitimate government, morality, history, economics, government policy, science, business, education, health care, energy, and man-made global warming evaluations. My posts are aimed at thinking, intelligent individuals, whose comments are very welcome.

"No matter how vast your knowledge or how modest, it is your own mind that has to acquire it." Ayn Rand

18 September 2009

The Cost of Waxman-Markey Carbon Cap and Trade

The Competitive Enterprise Institute used the Freedom of Information Act to discover on 15 September that Obama's Treasury Department estimated the cost of the Waxman-Markey Carbon Cap and Trade Bill to be from $100 billion to $200 billion per year. The average cost per household at this total cost has been calculated and found to be $1,761 per household based on the higher end of that range, apparently. [In 2000 there were almost 106 million households and there are more now.] Of course, no such figure was ever announced by the Obama administration. If it had been, Waxman-Markey would not have passed in the House of Representatives.

The Heritage Foundation believes the cost of Waxman-Markey will turn out to be about $2,979 per year from 2012 to 2035 for a family of four and that about 1.1 million jobs will be lost on average because of it between 2012 and 2035. By 2035, there will be 2.5 million fewer jobs due to cap and trade. The average GDP lost will be $393 billion per year from 2012 to 2035, with the lost GDP at $662 billion in 2035. From 2012 to 2035, the accumulated loss of GDP will be $9.4 trillion in 2009 dollars. I expect they are much closer to being right than even the new higher Treasury Department figure as this program matures.

Media Matters for America, a leftist organ, responds that the uncovered report was based on a version of Waxman-Markey prior to the version passed, which included the 300 pages of changes dumped into it in the early morning hours prior to the vote. Many of the carbon emission certificates had to be given away in order to get the bill passed. I would not be surprised if they are right in making this claim. They also point out that Obama plans to redistribute much of this money to those taxpayers or tax filers whom he happens to favor, so many households will not pay anywhere near so much as they would otherwise.

This is beside the point really. The bill passed was just to get the government's foot in the door, so they could control the use of energy in America. That they will achieve, if they can get this bill or something like it through the Senate. To do that, there will be more horse trading. The socialists then intend to use the income from the still sizable effective tax increase to both build a further constituency of dependent voters and to bribe further industries and private companies to build up pressure to expand the reach of the carbon cap and trade bill. Remember, the cost estimates were only for the early years anyway. The bill clearly says that the carbon emission certificates will not be given away as the years go by. The cost of the program to the economy will increase at a rapid rate.

Yes, some of the money may be given back to some individual households. One way or another this is usually what happens when government spends our money. We get some service or other, often one we do not want. Someone is paid to work for the government and they pay taxes and buy goods and services from the private sector. The money filters its way back into general circulation. Unfortunately, it does so with huge waste as measured against the only valid method to make such judgments. How would each individual have spent his money if the choice had been left to him?

OK, so you and your household have $1761. Would you choose to voluntarily send it in to the federal government for the purpose of reducing the use of fossil fuel energy? Actually, it would do no such thing. The government would spend most of it on other purposes. But, of course, there is nothing keeping you from reducing your use of fossil fuels if you think that is a worthwhile thing. Ride a bike to work instead of driving. Take a train to NYC instead of flying. Put better insulation into your house. Hey, go do your environmentally conscientious thing. Just get off this kick of hiring the government to force all of your neighbors to make the same effort to achieve your environmental values. They may believe their time, effort, and money is better devoted to other values.

Besides, the global warming of the late 20th Century was not caused by man's emissions of CO2 and such emissions have not been and will not become the cause of a catastrophe. That this is so is pretty well understood now scientifically. But, the politicians and bureaucrats need every excuse they can find for expanding the power of government and for the formation of international cabals of governments, so they are doing everything they can to perpetuate the myth of man-made global warming due to CO2 emissions.

Obama is giving his first speech to the U.N. next week. It will be given at a one-day session on climate change. More than 100 leaders of nations are gathering for the event. They are laying the groundwork for the Copenhagen conference in December on climate change which is supposed to take nations around the world much deeper into reduced energy use than did the Kyoto conference. These world leaders are firing themselves up to bring more massive use of force down upon the heads of their people to reduce energy use. They will do great mischief, causing the loss of many jobs and bringing on much misery in their efforts to deprive us all of the great facilitator of comfort and action, energy.

Life is all about being able to take action to achieve our self-chosen values. To do this, we need the freedom to choose our own values. A part of the necessary process for choosing our values is to be able to freely explore our world and to experiment scientifically and with our own lives. Choosing your values is itself a long process of exploration and development. That process requires individual liberty and the recognition that each of us owns his own unique life. Having identified our values, we must act to achieve them. One of the great advances in the industrial age was the development of power sources that greatly enhanced our efficiency in action. We could travel further and therefore explore further. We could transport goods over greater distances and hence trade with many more people in many different geographical locations. We learned from them in the process. Man's ability to feed, clothe, and house himself became much easier. This gave many men more time to devote to learning and developing highly specialized skills and knowledge. Energy use to increase the efficiency of human action has become a cornerstone of modern civilized life.

We have been steadily using energy more efficiently. We now insulate buildings better than ever before. We have vehicles that use energy more efficiently. Industries use it more efficiently in manufacturing. Home appliances use it more efficiently. All the normal effects of supply and demand have worked to cause people to use energy ever more efficiently. The more developed countries use it more efficiently than the little developed countries. In some ways the government has encouraged this. In others, it has discouraged this. We have to remember that if government did not take about half of the entire economy's output from us, a substantial part of that output would have been used to further increase the efficient use of energy. Government, as usual, is surely more a problem than a solution.

We should oppose the Obama administrations energy restriction policies for all of the following reasons:
  • They infringe upon our individual rights.
  • The government does not have a Constitutional power to limit the use of energy.
  • Energy use is a cornerstone of modern civilization.
  • The redistribution of income by government is immoral.
  • The claim that CO2 is a pollutant is wrong and foolish.
  • Smaller, lighter cars are more dangerous.
  • Mercury-containing light sources are dangerous.
  • CO2 makes our plants grow better and allows them to make more oxygen.
  • Coal-fired power plants with good scrubbers for sulfur products are less expensive and more reliable than solar power or wind generators.
  • The U. S. has huge coal reserves.
  • The coal industry employs many people.
  • Biofuel is a terrible waste of farm land and resources.
  • It is a mistake to give government more power. It will abuse its use.
  • Every act Obama undertakes is to advance socialism and/or internationalism.
With such a list of reasons for opposing carbon cap and trade, it is mind-boggling that the opposition to it is not more widespread than it is. One would think that only the 15 to 20% of Americans who are hardcore socialists would favor it. Any freedom-lover or rational person should oppose this carbon cap and trade monstrosity.

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