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Now Paul Krugman is Stealing $11,000 from Every American Household

Posted By Conn Carroll On May 1, 2009 @ 1:00 pm In Energy | Comments Disabled

In his New York Times column [1] today, Paul Krugman writes: “I cringe when “green economy” enthusiasts insist that protecting the environment would be all gain, no pain.” We feel [2] his pain [3]. But then Krugman goes on to write:

Consumers would end up poorer than they would have been without a climate-change policy. But how much poorer? Not much, say careful researchers, like those at the Environmental Protection Agency ….

But the EPA made some revealing assumptions [4] about the relationship between carbon emissions and economic growth in their study. Specifically, to keep the costs of emissions reductions as low as possible, the Obama EPA assumed a GDP growth rate of 2.5% per year. But to keep their deficit projections as low as possible, earlier this month the Obama OMB assumed a 3.3% growth rate.

University of Colorado professor Roger Pielke crunches the numbers [5] on what the smaller growth rate would mean for the average American:

Starting with the GDP figures in the President’s Budget and applying the different GDP growth rates leads to a difference in the size of the economy of $1.22 trillion between the President’s Budget projections and the EPA analysis of Waxman-Markey.

How much is $1.22 trillion? About $11,000 per U.S. household (assuming 115 million households). This number [obviously] gets larger in the out years if GDP growth rates exceed the 2.5% assumed by EPA. Adding in the costs of addition emissions reductions would make this number considerably larger.


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2009/05/01/now-paul-krugman-is-stealing-11000-from-every-american-household/

URLs in this post:

[1] column: http://www.nytimes.com/2009/05/01/opinion/01krugman.html?partner=rss&emc=rss

[2] We feel: http://apolloalliance.org/

[3] his pain: http://www.americanprogress.org/issues/2008/09/green_recovery.html

[4] revealing assumptions: http://www.foundry.org/2009/04/23/how-lisa-jackson-stole-11000-from-every-american-household/

[5] crunches the numbers: http://sciencepolicy.colorado.edu/prometheus/how-epa-lost-122-trillion-in-its-waxman-markey-analysis-5150

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