• The Heritage Network
    • Resize:
    • A
    • A
    • A
  • Donate
  • How to Hide a Trillion Dollars


    The Obama Administration’s recent budget has some of the most revealing text in the smallest font. Put on your green eyeshade and get out your wonk decoder ring. We’re heading down into the weeds to hunt budget big game.

    Footnote 5 of Table S-6 starts off “Shown here are those proceeds from auctioning emission allowances that are reserved for clean energy technology initiatives and to compensate families through the Making Work Pay tax cut.” This is in reference to “Total, climate revenues” of $645,711,000,000 which are to come from the President’s cap-and-trade restrictions on carbon dioxide.

    The implication in the table is that total climate revenues would be $645,711,000,000. But this is not the total, it is just what’s spent for two items—the energy technology initiatives and Make Work Pay.

    Any question about this is cleared up later in the footnote, “All additional net proceeds will be used to further compensate the public.”

    How large might be those “additional net proceeds?” In very round numbers, try $1,000,000,000,000. That’s right one trillion dollars. Though, it will likely be much more.

    The Center for Data Analysis at The Heritage Foundation analyzed the economic impact of the less aggressive Lieberman-Warner cap-and-trade. We found that total value of the allowances (the government auctioned permits whose cost is passed along to energy consumers) would be at least $1,622,848,000,000 for the years 2012 to 2019.

    This is a $1.6 trillion tax for just eight years. Note, the Congressional Budget Office, then headed by Obama’s OMB director, Peter Orszag, scored this revenue as a tax, not a “dividend” or an “investment.”

    So, this tax brings in over $1.6 trillion. It returns $0.5 trillion in dubious tax cuts and spends $0.12 trillion on picking technology winners. What happens to the remaining $1.0 trillion?

    It will be used “to further compensate the public.” Translated this means Washington awarded itself a bonus trillion bucks to spend however it wants. We get an unprecedented tax-and-spending spree masquerading as climate policy.

    Posted in Energy [slideshow_deploy]

    17 Responses to How to Hide a Trillion Dollars

    1. michelle, fl says:

      Stimulus package will only be stimulating Washington.

    2. Franklin's Lock says:

      This tax is despicable. It will tax everyone from the poor to corporations. It will generate a trillion dollars on the backs of hard-working Americans based on a farce premise that carbon is a pollutant. This tax will destroy us because it will drive the prices of everything up. So, we will be double taxed by paying the tax and the additional cost of goods and services.


    3. Dale, Cincinnati says:

      Why don't they "compensate the public" by letting us keep our money to start with.

    4. JImmy - May (by God) says:

      "I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them." —-Thomas Jefferson

    5. Pingback: How to Hide a Trillion Dollars « Stop Socialism Now

    6. Jeff, California (no says:

      Jimmy has it dead on, with some help from Jefferson of course.

      I told someone I work with that every time they hear something from this administration look for the Socialist angle, because it's always there.

      Imagine what kind of nationalized health care could be be jumpstarted with $1 trillion "surplus" dollars to compensate the public?

    7. Steve, Michigan says:

      It's funny how the government gets away with such fraudulent financial statements. If a publicly traded company put out such drivel, its executives would be looking at a long time behind bars.

    8. Steve, Michigan says:

      James Madison, Federalist Papers:

      "Some, who have not denied the necessity of the power of taxation, have grounded a very fierce attack against the Constitution, on the language in which it is defined. It has been urged and echoed, that the power "to lay and collect taxes, duties, imposts, and excises, to pay the debts, and provide for the common defense and general welfare of the United States," amounts to an unlimited commission to exercise every power which may be alleged to be necessary for the common defense or general welfare. No stronger proof could be given of the distress under which these writers labor for objections, than their stooping to such a misconstruction."

      Funny how the concept of limited government has disappeared of late!

    9. charles, wyoming.usa says:

      This whole administration is socialist, das ist riktig comrade. All hail our new savior. BULL,

      wake-up ammerica, the enemy is us.

    10. Bobbi, New Jersey says:

      It might be useful if someone who can do the math figured out how much $1 trillion in taxes will cost each American taxpayer and compare that with the measley $400 provided by the Obama tax cut.

    11. Dennis A. Social Cir says:

      His tax cut resulted in a gain of $9.00 to my check, good times are hear again. Ha! Ha! I am sure the welfare people are happy, they will get plenty from my check. Think I should quit work an apply for food stamps and welfare, I know I would be better off.

      Who the heck is going to pay for all this crap that obama is doing??????

    12. Gary, Virginia says:

      Dennis, unfortunately you, I and every hard working Citizen is going to pay and pay and pay for this abomination. The attitude of "might as well quit my job and let the Government take care of me" is exactly what they want. A population where the majority is dependent on the Government will keep in power those who promise (and maybe deliver) the support. The Democrats (lead my Obama) are creating a welfare state to keep themselves in power.

    13. Ingrid in Texas says:

      It was stated in the fall of 2008 when we bailed out AIG, that we cannot afford to loose thousands of jobs here in the U.S. and in other countries.

      Will someone please explain to me why we need to leave our children with a huge tax burden to help aig’s employees in other countries.

      Doesn’t GM, Ford and Chrysler have much more employees?

      Don’t we have other great Insurance companies here in the U.S.

      Read the “Bildeberg Group” 2007 meeting conclusion and tell me that the arrogant elite aren’t getting paid off. Tell me that their plan is not being put into action by a man who says he doesn’t have time to think about our financial crises.

      Tell me that this new administration wasn’t hand picked by the arrogant elite and that Clinton didn’t have a hand in this.

      These news articles are an incite to a much bigger devastation going on then we are aware of.

      If we don’t start asking the right questions, we will never find out the real truth. And, let the new god proclaim himself to be our savior (not Obama)and convince us that what we buy and use is good for us and he will reward us with free health care and cheap medicines. (we will need then)

      Then the world will be as one…. no middle class and nothing in between except the rich gods (about 8 or 10 of them)and the very, very poor.

    14. Lynn B. DeSpain says:

      Even crime wouldn't pay if the Government ran it!


    15. Dwana Townsend says:

      I wonder how Obama made it to where he is in the first place. He came from a poor family but yet he attended ivy league schools???? Someone must have been behind this, grooming him from a very young age, and now is his time. Now who do you think that could be? I am sure we are soon to find out. Obama is anti American. He is a socialist/marxist and will transform this Great United States into something unrecognizable.

      Its time for him to produce his birth certificate for public viewing. He owes the American Public that elected him into office at least that much!!!!!!!

    16. Lucy Lehner says:

      Every change obma has made is UnAmerican! He is bent on dystroying America. I write letters, e-mail, call senators and congress members. I have even gone to "tea Partys" I'll be at our State House Sunday for a protest walk. Also, How can this man get away with having his birth certificate sealed and his college thesis? We have a terrorist in the White House!

    17. THOMAS GRAY, SC says:

      Politicians spend our tax money, and fail. Therefore, they need to spend more of our tax money. Repeat until dead.

      So much incorrectness, so little time. The thing that started the economy down the rat hole was the sub-prime mess, for which both parties bear some of the blame, but the social tinkering part of it was uniquely the Democrats. Look at C-Span and you'll see Bush and Treasury warning about the impending doom from the "regulation" of Freddy and Fanny; Frank, Dodd, Schumer, and Boxer were all saying "there's nothing to see here, move along." Arguably Greenspan was asleep at the switch on monetary policy. However you folks really have to get fiscal policy more straight in your heads; that being the combination of tax policy and spending policy. If you lower taxes, and revenues go up, and they did, that is a good thing. On the other hand, if you then go out and spend such that you'd make inebriated sailors blush, you can still generate a deficit, and surely that happened on the Bush's watch. Now that we have overspent horribly, you want to believe that raising taxes in a recession won't make it worse and lower revenue, and that even more profligate spending that we can't afford will make it better. Stimulus packages have a horrible record, the only time they worked was at the end of WWII, but for that to work we had to bomb all of the other economies into the stone age, brave but not practical. So now if they do any good at all there are the three "T's" targeted, timely, and temporary. This bunch of pork is none of that. It's money we don't have for things that we either don't need, or won't help.

    Comments are subject to approval and moderation. We remind everyone that The Heritage Foundation promotes a civil society where ideas and debate flourish. Please be respectful of each other and the subjects of any criticism. While we may not always agree on policy, we should all agree that being appropriately informed is everyone's intention visiting this site. Profanity, lewdness, personal attacks, and other forms of incivility will not be tolerated. Please keep your thoughts brief and avoid ALL CAPS. While we respect your first amendment rights, we are obligated to our readers to maintain these standards. Thanks for joining the conversation.

    Big Government Is NOT the Answer

    Your tax dollars are being spent on programs that we really don't need.

    I Agree I Disagree ×

    Get Heritage In Your Inbox — FREE!

    Heritage Foundation e-mails keep you updated on the ongoing policy battles in Washington and around the country.