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  • A Tax by Any Other Name

    Is still a tax. This notion is especially important now as more people are beginning to recognize what a cap-and-trade program to reduce carbon dioxide actually is: a heavy tax on energy consumption. The Wall Street Journal bluntly says, “If it brings in revenue that the government then spends, it’s a tax, and politicians should start referring to it as such.” And the revenue will be quite large; if enacted a cap-and-trade program will generate enough revenue to become the sixth largest source of federal receipts by 2019.

    In his speech last week he claimed, “If your family earns less than $250,000 a year, you will not see your taxes increased a single dime. Not one single dime.”

    But Obama forgot to throw in the caveat, “unless you use energy.” Before Obama was elected, when discussing the intentions of his cap-and-trade policy (see the 32-second mark of this video), he acknowledges that “electricity rates will necessarily skyrocket.” That’s a tax on your electricity bill, plain and simple.

    As claimed by the Obama Administration in the federal budget blueprint, however, everything will be all right because the money will be recycled back to the people. Under the EPA’s section of the budget, of the total $650 billion in revenues from 2012-19, $80 billion each year will be used as a tax cut. From the New York Times:

    “That tax credit annually will provide $400 to low-wage and middle-income workers or $800 to couples; Mr. Obama would like to increase those figures to $500 and $1,000. The credit phases out for those with incomes above $75,000 a year and for couples with incomes of more than $150,000; no benefit would go to individuals with more than $100,000 income and couples with $200,000.”

    And back to the WSJ:

    “By the way, the Congressional Budget Office estimates that cap-and-trade taxes would actually throw off as much as $300 billion every year — not merely $78.7 billion — and in a footnote the Obama budget implicitly acknowledges that its $645.7 billion estimate is a lowball: ‘All additional net proceeds will be used to further compensate the public. No doubt.”

    So on surface it looks as if there will be winners and losers. But that’s expecting the tax cuts will offset the higher electricity costs. In reality, there will be losers and even bigger losers. Take, for instance, the results of a new study released by the George C. Marshall Institute. Bryan Buckley and Sergey Mityakov of Clemson University find:

    “The authors find that the constraints posed by the Lieberman-Warner cap-and-trade approach is equivalent to a constant (in percentage terms) consumption decrease of about 1% each year, continuing to 2050. Put another way, the cap-and-trade approach is the equivalent of a permanent tax increase for the average American household, which was estimated to be $1,100 in 2008, would rise to $1,437 by 2015, to $1,979 in 2030, and $2,979 in 2050.”

    Furthermore, the Lieberman-Warner bill that died on the Senate floor last summer ratcheted down from a freeze at 2005 emissions levels in 2012 to a 70 percent reduction below those levels by 2050. Obviously a more stringent bill would result in a higher energy tax.

    Americans won’t stand for an energy tax in such tough economic conditions. To make matters worse, this high tax will be for naught as cutting carbon solely in the U.S. will only change global temperatures by a fraction of a degree.

    Implicitly acknowledging the futility of our CO2 cuts, the EPA outlines a case of international cooperation. Unfortunately this case requires the developing world, including India and China, to revert to their 2000 levels of CO2 emissions by 2050. On a per capita basis, China would backtrack to about one-tenth of what the US emitted in 2000. India and most of the developing world would have to drop to even lower levels. In short, this scenario is a fantasy.

    What’s in a name? A lot of tax revenue for the federal government and more economic pain for the American consumer.

    Posted in Energy [slideshow_deploy]

    18 Responses to A Tax by Any Other Name

    1. Brook says:

      Obama is overlooking one thing: WE HAVE THE MONEY. If this passes I will immediately contact my state reps to organize a state revolt.

    2. Ozzy6900, CT says:

      We have enough in CT with the Power companies getting a rate increase every 6 months. Now the "anointed one" is going to start the cap & trade idiocy which will cost the consumer even more money.

      No, Brook, I disagree in that we do NOT have the money to cover all of this stupidity! But I like the idea of a Revolt!

    3. William, Leesburg VA says:

      Incredible I never thought the Fed would tax the air I breath. But I was only half wrong they are taxing the air I exhale. What happen after the election did we end up in bizarro world? I mean taxing Co2 emissions I think we should tax the users of the Co2 , the plants and trees. My goodness this administation is either incredibly naive and ignorant or just plain stupid. I mean fix the economy by raising taxes, fix the housing crisis by reducing the home mortage interest deduction? They are doing everything prefectly wrong, they should be lowering taxes and increasing or doubling the home interest deductions.

      Oh, well theres always the COngressional elections in 2010. Here is hoping Anericans have had ENOUGH!!

    4. Linda , Keansburg, N says:

      I say we make history again and try to get our Congressmen to start impeachment proceedings against the president. This man is destroying this great country at a break neck speed.

    5. Tim AZ says:

      Sorry Linda but our congressmen that are now in control think he should be doing more. Expect no help from them. We the people are going to have to take back our country. Unfortunately Obummer may be right there probably isn't enough American citizens left with the intestinal fortitude to do anything that would result in discomfort to themselves to take back America.

    6. Dale, Cincinnati says:

      Washington doesn't yet see that we live in a global economy? Cap and trade will drive industry overseas and take valuable jobs with it. Not only will the U.S. CO2 emissions fall, so will tax revenues. There will be a downward spiral requiring even higher tax rates to offset the loss in government revenue. Eventually, actually quite quickly, US citizens will experience some of the highest tax rates in the world.

      Wealthy Europeans once flocked to the US because of our "tax haven” status. Foreign entrepreneurs and scientists came here for high paying jobs and greater opportunity. Get ready for reverse immigration as workers follow the jobs and the wealthy choose live and work where governments let them keep some of their money.

      It’s obvious from Obama’s actions during the past month that his socialist agenda is of greater importance than the US economy. It make one wonder if there isn’t some ulterior motive behind his continuous negativism.

    7. Linda , Keansburg, N says:

      You know you're right Tim. There are Congressional seats up for grabs in 2010 and I'm going to try my hardest to see they are filled with conservatives that believe in the core principles. Does everyone know that Reid, Pelosi, Dodd, Schumer, Barney Frank, Spector and Barbara Boxer are all up for election in 2010? We need to vote these bums out.

    8. Linda , Keansburg, N says:

      Don't you remember his speeches before he was elected. He said he was going to change the world. He is certainly doing that. And now we are going to roll over and play dead with his foreign policies that he is implementing. I would rather have our country looked upon as a super power and not as a 3rd world country begging other countries for money.

    9. Dennis A. Social Cir says:

      Socialism is alive and well in WASHINGTON. "THE GREAT ONE" is the head of this snake and THE DEM CONGRESS are the followers of HIS WILL. I think it is past time for the AMERICAN PEOPLE to take this COUNTRY BACK. WE need a new bunc in DC and they need to know who they work for.

      I just wonder do we have enough time before the next election to stop this destruction of AMERICA?????

    10. ra,ohio says:

      Get their attention:

      A revolt was mentioned above, why not a tax revolt.

      Everyone owing the feds money pays 50% of their liability.

    11. charles, wyoming.usa says:

      a revolt would do good, once and a while the weeds do need to be burned, level the field and repeel everything from 1933 forward that isn't constitutional and get this nation back on track.

    12. Thomas Gray, South C says:

      To linda,

      Your right and you got the names right, but these men are more than bums they are traiters.

    13. Thomas Gray, South C says:

      I heard barny franks lie, has he yet said he was wrong about what he said about fanny may, in my opinion the man is a goofball and I'm sorry to admit half of my family is from boston.

    14. mike baker Dallas C says:

      The most neglected amendment of the U.S. Constitution, the once mighty Tenth, is beginning a resurgence of attention around our country. Today the Virginia assembly became the fourteenth state, recently, to introduce resolutions reserving certain state sovereignty rights as guaranteed by our founding Contract With America. Encourage your representatives if you approve. The current U.S. government is killing the current U.S. economy.

    15. OPAS says:

      How soon we forget, Kruschev warned us that they would bury us, using our own laws. Check it out. To all of the above, who's "undecided" family and friends very probably voted for the stranger that refused to prove his birthright, remember, when you vote next time, VOTE DEMOCRAT! You wanted change and now you have it.

    16. Pingback: Wonk Room » Wolf Blitzer Parrots Right-Wing Talking Points On Global Warming

    17. Pingback: debunk.the.bunk « must be spoken, made verbal, and shared.

    18. Pingback: EnergyByEarth.com » A Wolf in tool’s clothing

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