Cap and Tax PassesPolicy

Final passage of the Cap and Tax Bill (“American Clean Energy and Security Act” (H.R. 2454)) passed the House today 219-212 with 8 Republicans voting in favor and 43 Democrats voting against. The bill will now be sent to the Senate for consideration.

Final Roll Call and details of the bill will be posted soon on this thread.

On final passage, only Glenn Nye voted “No” from Virginia Democrats. Tom Perriello voted “Aye”.

The Heritage Foundation testified before Congress on June 22 and offered the following estimates on the cost of the bill:

The higher energy costs kick in as soon as the bill’s provisions take effect in 2012. For a household of four, energy costs go up $436 that year, and they eventually reach $1,241 in 2035 and average $829 annually over that span. Electricity costs go up 90 percent by 2035, gasoline by 58 percent, and natural gas by 55 percent by 2035. The cumulative higher energy costs for a family of four by then will be nearly $20,000.

But direct energy costs are only part of the consumer impact. Nearly everything goes up, since higher energy costs raise production costs. If you look at the total cost of Waxman-Markey, it works out to an average of $2,979 annually from 2012-2035 for a household of four. By 2035 alone, the total cost is over $4,600.

Beyond the cost impact on individuals and households, Waxman-Markey also affects employment, and especially employment in the manufacturing sector. We estimate job losses averaging 1,145,000 at any given time from 2012-2035. And note that those are net job losses, after the much-hyped green jobs are taken into account. Some of the lost jobs will be destroyed entirely, while others will be outsourced to nations like China and India that have repeatedly stated that they’ll never hamper their own economic growth with energy-cost boosting global warming measures like Waxman-Markey.

Be sure to read the entire testimony to read more of the costs.

The Forbes “New Manhattan” Amendment failed 172-256 with no support from Virginia Democrats.

From Rep. Forbes:

“Americans were watching today to see how the House of Representatives would pursue our nation’s energy future. Would we rely on innovation to pursue alternative energy sources and achieve a cleaner environment? Would we embark on a bold mission to make ET – energy technology – to the 21st century what IT was to the 90s? Would we choose a plan that would create lasting economic security and secure our global competitiveness for years to come?

“Unfortunately, this evening the House chose taxation over innovation, without my support. I introduced the New Manhattan Project as a substitute amendment to the cap-and-trade national energy tax because instead of relying on taxation, it relies on the ingenuity, innovation, and imagination of the American people to create the next revolution in energy technology. While the New Manhattan Project was ultimately voted down today because of partisan politics, I look forward to continuing to fight for the project as a stand-alone bill because it is an energy solution overwhelmingly supported by the American people and because, most importantly, it is a solution that is right for our country,” said Forbes.

From Rep. Rob Wittman:

“As an environmental scientist, crafting legislation to protect our environment and transition our economy to clean energy is one of my top priorities. I believe we must focus on aggressively pursuing alternative and renewable energy, but do so in a manner that does not create greater problems than it solves. This is why I could not support today’s Cap and Trade legislation.”

“Virginians, along with the rest of America, are struggling through the most challenging economic environment since the Great Depression. Congress must consider the impact of each bill we pass on the farmers and watermen who are already struggling to make ends meet. And, in areas like energy and the environment, we must make the transition to alternative and renewable energy in the least disruptive method for our economy.”

“At last count, unemployment stood at 10.2% in Lancaster county, 9.4% in Northumberland county, and around 8% in much of the rest of the First District. I also have serious reservations about the threat this legislation poses to our industrial base and the energy intensive shipbuilding industry in Newport News. Put simply, the Cap and Trade bill promised to create far more problems for my constituents than it solved.”

“Simply opposing flawed legislation, however, does not get us any closer to a solution. That’s why Congress must move towards a plan that transitions our country to clean energy in an economically viable manner. I am a cosponsor of the American Energy Act because it does just that. I will continue to work with my colleagues in the House to accomplish a sustainable, comprehensive energy policy.”

  • tx2vadem

    CBO is a non-partisan organization (generally lauded by both parties). Why do you not trust their estimates?

  • http://bearingdrift.com JR Hoeft

    Because it is not a comprehensive estimate. WSJ has a very good explanation.

  • tx2vadem

    The specific reason that the CBO did not go beyond 2020 is that estimates that far out are so uncertain as to be worthless. There are a lot of uncertainties in determining its impact on the economy. At what point do the prices of substitutes drop given economies of scale? At what point do higher natural gas prices spur investment in extraction technologies that increase supply and reduce the price pressure? Different cost structures in the economy will present opportunities to entrepreneurs to make money in that space. So, I wouldn’t put anymore weight on the Heritage Foundation’s analysis. Too much is unknown and they assume we plod along at historical levels and that we remain dependent upon fossil fuels at basically the same levels throughout the life of the bill.

    Do you think global warming is well established? Do you think we should do something about it? And what do you think the solution should be? If you really think that is Forbes’s bill, can you speak to the potential efficacy and why it would be?

    I mean if you don’t think it is certain enough or that we can’t come up with a solution that will make a lick of difference, that really says it all. But if you think we should be doing something, then what is an effective alternative?

  • http://rightwingliberal.wordpress.com D.J. McGuire

    The CBO also left out the effects on the bill’s regulations on the economy. That makes the report so incomplete as to be laughable.

  • http://bearingdrift.com JR Hoeft

    One of the ironies here, Tex, is that the very thing you imply with me is what your congressman actually did.

    Glenn Nye voted against the Forbes amendment and voted against the climate change bill.

    Does this mean that he found neither solution palatable?

    Tex, I don’t make law…I just comment on my perception of the process.

    I think you should take up your questions directly with your congressman, who clearly doesn’t think climate change legislation is necessary.

  • http://unitedconservatives.blogspot.com/ Cargosquid

    First, the entire bill is based on a false premise of confirmed man-made global warming. Not only has any global warming been confirmed to be man-made, THE PLANET IS COOLING!

    Second, no one read this bill. 300 pages were snuck in at 3 am. And there is an unconstitutional “place holder” mentioned so that they can add more after the vote.

    Third, the entire premise of “cap and trade” is a proven failure. Look at Europe and Kyoto. China and India have already spoken. They are NOT going to kill THEIR economies.

    Fourth, Spain is bewildered that we are following a similar plan for green jobs as theirs. Their plan failed miserably.

    This bill will do nothing but hurt our economy. NOTHING will be gained, except that Al Gore’s wallet will get fatter. He owns a “carbon credit” company. Where are all the critics of Enron? This was an idea pushed by those thieves.

  • http://pwconservative.net PWConservative

    So Sad that the Republican Comeback will be due to such an enormous mistake.

  • Darrell — Chesapeake

    I don’t know what you guys are complaining about. What’s good for Goldman Sachs is good for America, isn’t it? Besides the easy way around this is to just pay your carbon tax and other bills with a credit card. Then just walkaway.

    The average hard working American is at a crossroads. Either keep faith in a fantasy, or join the rest of the deadbeats. The daily newspaper is telling you which path more citizens are choosing.

  • http://www.amit-singh.com Amit

    PWC, without the Republicans this vote would not have passed. Not sure if that helps their comeback

  • Darrell — Chesapeake

    http://www.washingtonpost.com/wp-dyn/content/article/2009/06/23/AR2009062303500.html

    Remember moral hazard and unintended consequences? They’re Baack! Some of the analysis I’ve read says the banks don’t want to foreclose because:

    A. They have too many houses already.

    B. If they write the house off, it’s an instant hit on their balance sheets.

    C. They don’t want the legal hassles with the states/counties/etc.

    D. The losses don’t matter because TARP covers it.

    E. They can’t figure out who the real owners of the mortgage are.

    F. All the above.

    We’ve gone from walkaway to stayforfree. Who knew that sub-prime Ninja loans would evolve into a new Ninja Lifestyle that even upper middle class are joining as their Opt-ARMS and Prime Jumbos go bust?

  • http://TidewaterLiberty.com Britt Howard

    Good stuff Cargosquid. We need to explain this to Bob “Green Jobs McDonnell”. See the below quote(just google Spain green jobs failure):

    *************************************

    Every “green job” created with government money in Spain over the last eight years came at the cost of 2.2 regular jobs, and only one in 10 of the newly created green jobs became a permanent job, says a new study released this month. The study draws parallels with the green jobs programs of the Obama administration.

    But the author of the study, Dr. Gabriel Calzada, an economics professor at Juan Carlos University in Madrid, said the United States should expect results similar to those in Spain.”
    *************************************

    No Tex, I for one don’t see global warming as “Well established” except as trusted gossip in Left Wing circles.

    I know….I know, just because the Earth is cooling and that volcanos cause more than humans means nothing. There is always a Global Warming Scam excuse. They say, yea its cooler here but hotter there and look at all the tornados and hurricanes. Now that we’ve been in a lull of hurricanes, I guess there’s another excuse for that.

    What is truly scary is that IF and that is a big IF, there is global warming and man is to blame, at least that “Messing with mother nature” was unintended. The global warming scammers like Al Gore, are asking us to to interfere PURPOSELY with nature even WITHOUT incontrivertable FACTS! What if you’re wrong? What if we somehow actually can affect the global climate? What if Al Gore’s pocket filling ideas push the climate out of balance and cause catastrophe? What will you do then? Excuse it by saying, “Ooops, I guess we were wrong”. I doubt it. More than likely, some BS story about if we had acted sooner all the evidence that SEEMS contrary to global warming never would have occured. Its always the same transparent attempt at continuing this ponzi scheme by attempting to BS through it.

    The US is getting cleaner just throught the use of technology. China and India are not developed enough to be as clean as we can. Therefore, as you and all the Democrats know, they CAN’T abide by Kyoto and hope to further evolve. They’re not going to put their nations on a suicide course. Doesn’t look like they’ll try to stop us.

    Gotta give Nye credit. Perriello just gave ammunition to his future opponent. This is going to be a horrible drain on our economy. We must stop this in the Senate.

  • tx2vadem

    JR, I’m flattered that I am such an everyman that you think Nye is my rep. Actually, I hail from the 8th Congressional District; and Jim Moran is my rep.

    You do more though than just comment on the legislative process. You advocate for specific bills. I’m just trying to cull out your specific arguments in favor of those bills. I’m not ascribing anything, just seeking clarity.

    Brett, I don’t know if you’re ascribing arguments to me that I did not make or if you are just reporting your opinion. I was just trying to clarify Mr. Hoeft’s position.

  • http://TidewaterLiberty.com Britt Howard

    I am partly giving my opinion Tex, but you do seem to carving out a position for yourself when you defend the legislation against the WSJ and the Heritage Foundation specifically on the back end loading of all the pain. There is FAR more to this particular bill and also to the points in the WSJ and Heritage analysis. This defense of a smaller part of a larger issue can suggest a held position.

    Perhaps I read it other than was intended, but I think there was reason enough given to take the assumption that you favor this legislation. Often when someone asks for clarification of a position, the questioner holds a differing view of the topic.

    If this was not the case, why would Hoeft bother to direct his response the way that he did. Incorrect as to your congressman or not, I’m not the only person that felt your line of logic and questions suggested a held position.

    It was announced by Reid Greenmun(Chairman of the Tidewater Libertarian Party) at the Tea Party in Chesapeake that Cap & Tax passed as soon as results came in. Oh sure, there are Republicans at these Tea Parties, but not exclusively so by a long shot. Many people blame the Republicans for being big government socialists as well. This goes beyond mere partisanship. Many people were very unhappy that this threat to our economic health passed.

    If I overreacted to your request for clarification, it is likely due to my passionate opinion that this legislation is dangerous and will bring us closer to socialism, a loss of freedom, and economic ruin.

    Conservation and innovative ways of clean energy production do not necessitate assaults on the American way of life.

    If your position has been mistaken for something else, I would encourage you to give us your actual take on Cap and Trade.

  • http://pwconservative.net PWConservative

    Amit

    Are You seriously nitpicking over 8 friggin votes? The GOP Voted overwhelmingly against.

  • http://www.amit-singh.com Amit

    since the vote passed with 7 votes I think its justified to nitpick over 8 votes. if they had kept the bill from passing then I think that could have earned a GOP comeback comment.

  • http://www.amit-singh.com Amit

    btw, a video made by a guy that lives in my building:

  • Pingback: Apparently while I was out of town this weekend…

  • tx2vadem

    Britt,

    It’s hard to critique this bill because it is so long. That is one of the beauties of Virginia’s constitution: the one topic clause. But from a 50,000 foot level, I don’t like the idea of Cap & Trade for carbon dioxide. What has worked well for sulphur dioxide doesn’t necessarily translate into something that will work well for CO2.

    What I dislike about Cap and Trade is that it is administratively complex. You have to setup a new regulatory structure to administer it. A direct tax would have been a far more efficient way to have gone about this. We already have an existing framework to administer and collect such a tax. The reason I think this is bad in comparison to SO2 trading is that the market is so huge. There will be invariably a huge market of middlemen created by the financial sector. All that money that floats around in investment markets will add to the price of credits, as speculation can do. I think there will be pricing volatility which will make it very difficult for businesses to make decisions.

    To your point about climate science, it’s a complex field in which I have no expertise. As with many things, I am therefore happy to rely on experts. The consensus of which is that humans are contributing to global warming (at least, as I understand it). That isn’t to say there is no variability there and no uncertainties. My opinion on mitigation though (assuming that the IPCC’s prediction or worse is right) is that the change required to industrialized economies, especially ours, is untenable.

    I still think it is a good idea to diversify away from oil and coal. Taking CO2 out of the equation, coal extraction & combustion is still dirty. Oil reserves are concentrated in parts of the world with a high degree of political risk including repressive, undemocratic regimes. And as the economies of China and India continue to grow, there simply won’t be enough production to satisfy all that demand. So, best to wean ourselves off it before more price pressures hit.

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