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  • Heritage Foundation Releases Economic Study of Waxman-Markey Cap and Trade Bill

    The idea behind cap and trade is to reduce carbon dioxide emissions by putting a price on the right to emit carbon and other greenhouse gases on businesses. Since 85 percent of America’s energy needs are met through carbon-emitting fossil fuels, cap and trade would be a massive tax on energy consumption if enacted.

    The debate will move to the Senate this fall. Here’s what to expect if the Senate passes their own version of Waxman-Markey and President Obama signs cap and trade into law.

    By 2035:

    • Gasoline prices will rise 58 percent. Gas prices are expected to increase in the future even without cap and trade. Waxman-Markey would add an additional $1.38 to that increase.
    • Natural gas prices will rise 55 percent;
    • Heating oil prices will rise 56 percent;
    • Electricity prices will rise 90 percent;
    • A family of four can expect per-year energy costs to rise $1,241;
    • Including taxes, a family of four will pay an additional $4,609 per year;
    • A family of four will reduce its consumption of goods and services by up to $3,000 per year, as its income and savings fall;
    • Aggregate GDP losses will be $9.4 trillion; in other words, we will be $9.4 trillion poorer with cap and trade than without.
    • The government will collect $5.7 trillion  in energy tax revenue.
    • Job losses will be nearly 2.5 million; and
    • The national debt will rise an additional $5 trillion ($12,803 per person or $51,212 per family of four).
    (All figures are in constant 2009 dollars.)

    The full Center for Data Analysis report breaks down the legislation (pages 3-4), how the economic model works (pages 6-7), how the energy model works (pages 7-8), and details the reasons why Waxman-Markey is so costly (pages 8-12 ). Appendix two has key economic indicators (GDP loss, personal income loss, unemployment loss, etc) by year, while appendix three has the breakdown of GDP loss, income loss and unemployment loss by state.

    The report also includes three breakout sections. The first, on pages 3 and 4, breaks down the effects on different industries. Since some sectors of the economy are more energy-intensive than others, these industries are hit harder by the higher prices. The second breakout, on pages 4-6, includes a description of the allowance giveaways – those industries lucky enough to win the lobbying battles that took place. On page 12, the third breakout debunks why EPA and CBO are reporting that Waxman-Markey will cost a postage stamp per day.

    Proponents of Waxman-Markey argue that we need to save the planet to give our children and our grandchildren a better world to live in – but this is not a gift we’re leaving for the next generation – it’s a less prosperous country with fewer opportunities. The income losses, the job losses, the tax increases, and the mounting debt all get worse over the decades. Instead of selfless charity for those who follow, this bill forces a bad deal on a generation that doesn’t have the option to turn it down.

    Posted in Energy [slideshow_deploy]

    30 Responses to Heritage Foundation Releases Economic Study of Waxman-Markey Cap and Trade Bill

    1. fiftyfifty says:

      Waxman-Markey Cap and Trade Bill is a danger along with health care I feel this is the payoff this bill pass's it would be a good time to put your money in GE

    2. Chris, Tampa, Iraq says:

      O.K. let's be real, the thing about human being's is alot of us think we are the center of the universe. If the earth has already destroyed itself and brought back life what 5 or 6 times, sorry I just can't get down with idea that we have an impact. Dinosaurs didn't drive suv's, people get over yourself. It will be less expendable money to stimulate the economy with in every household in the country. What ever happen to putting our life in god's hands. I think this is all about control, I see one liberty after another being ripped away from us. I don't believe the people supporting this bill actually think they can control the planet, I just don't. And that my friends is why it is definetly just another power grab by democrats in a long series to come, unless we vote them out. Common since has left the building and everything that comes out of these liberals mouth is a twisted and distorted lie in some way. It really takes allot of nerve to say the things they do in front of millions with a straight face each and everyday. I feel taunted, (Don't you)…………………

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    5. Aaron Needham says:

      Cap and Trade is not all bad and the rise in cost will not take place over night. There are avenues available to the public to change their lifestyle and lower their CO2 emissions. We are seeing a movement of money and wealth and a reprioritizing of finances. Some cost will go up and others will come down and the Obama adminstration is providing billions to help. We are americans and we are leaders and we will show the world how this makes sense and we will make it work for us and our kids/ kids.

    6. Steve,rhode island says:

      so this is what the lie of Global Warming brings

      Money and taxwes for government, a drop in lifestyle for common man.

    7. Roland D, Claus, Ber says:

      Whatever the expressed purpose, the Cap and Trade, Health Care, no matter what details, are intended for one glaring reason: controlling and enslaving the people of this nation. None of them are grounded in the principles of the Declaration of Independence, the Constitution, and the Bill of Rights, nor are any of the proponents leading this blatant attempted takeover more importantly even remotely aware of the God behind this nation's Heritage and success. We are now threatened by a flood of thug organizers, politicians with their hands out, and a huge fifty some odd percentage of our population employed by government. This assault must be destroyed.

    8. Jesse Texas says:

      Aaron, the Billions in help Obama is providing is actually our money. The debate over man made glogal warming is not over. We exhale CO2….

    9. Sherrie ms. says:

      I agree with Roland D, Claus, Bergen,and Steve,rhode.When you stop and really look at everything the gov.wants to take control of our life.

    10. Richard, Tampa Bay says:

      I do not agree with Mr. Needham's "not all bad" comment. We can continue to improve our air quality by using a thoughtful incremental approach as we have tried in the past. Those efforts, such as relaxing the "all or none" improvement standards for "smokestack" emissions, have been stopped by our political Left.

      A wealthy country can continuously improve, as we have. If that wealth is used by the government rather than by the private sector, it simply does not work as well if at all.

      The increase in energy cost for necessities will shift the financial wealth to the government. This is a "reprioritizing of finances". Cap and Trade and the "Obama administration providing billions to help" takes what is earned in the private sector to be spent as the government wishes. Interesting, but not American.

      We and our kids will be better off spending in a good old fashioned free market system generating more wealth with which improving the quality of our lives can continue.

    11. Sandra, Wisconsin says:

      I agree with Jesse's comment. The billions that the Obama administration is providing is actually taxpayer dollars. I prefer to keep the money that I have worked so hard to earn and spend it in my local economy.

    12. John Maryland says:

      I see that we have three entries to begin with from the other side of the political spectrum. I have to ask why one poster thinks an increase in cost is perfectly alright if it occurs somewhere (undefined by you) in the future? An increase in cost is still an increase in cost. You hoping it all lands on your children? I think you are totally wrong. If they pass this bill, cost will start climbing soon after it is signed. As for "movement of money and wealth", sounds a whole lot like "according to their need from according to their ability." Very Marxist, is it not? "Some cost will go up and others will come down." We already know that the big ticket items are going up in cost, significantly. Does anyone care to elaborate on what prices will fall? Twinkies? "The Obama administration is providing billions to help." The Obama administration is providing nothing, the taxpayers are. In conclusion, what is the result of this Henry Waxman, congressman from the bankrupt state of California, inspired bill? Every study I've seen puts the reduction in global temperature at a percentage somewhere well left of the decimal. Does this justify the further destruction of our economy? You have to be nuts to support this legislation.

    13. Jon, Missouri says:

      As the Cap and Trade Bill will be used to reduce the carbon dioxide emissions, when will they eliminate all soda pop and beer? All or our favorite drinks contain the "fizz" or bubbles that are generated with injected or naturaly produced CO2. These people do not understand that CO2 is nature's product…

    14. Jon, Missouri says:

      What about fire protection? One of the major fire suppression agents used worldwide is CO2. Will CO2 go the way of another excellent fire extinguishant; Halon? Our government taxed Halon out of existance for public use, but continue to use it for government applications (military).

      Please note that McDonalds and all other fast food outlets buy CO2 by the ton for making all of their fontain drinks.

    15. Jon, Missouri says:

      Carbon Dioxide is used as a coolant in large food processing and transportation applications. Will these processes and cooling equipment be forced to replace their CO2 systems with more expensive equipment?

    16. Chris, Tampa, Iraq says:

      I agree John, fight the good fight

    17. Laurie, AZ says:

      why do they, the feds, wanna pass the buck down onto the next generation(s)? why not make it LAW to manufacture only AFFORDABLE GREEN products that reduce emissions/heating & cooling costs, etc., to help save on ALL expenses? Why shouldn't the fed. gov. look inward to see where they can REALLY START TO MAKE A DIFFERENCE? why don't the congress/fed. gov. employees take a year or 2 off their pensions, pay for their own healthcare, and completely do away with their post-govt-employment bodyguards to see what kind of savings the FEDERAL GOVT can come up with? why should we taxpayers keep paying for this stuff when these people are paid much better than the average joe? Does anyone know of a federal employee who complains about their pay or healthcare bennies? Where should and does the belt-tightening begin?!? I think we all know the answer to that…

    18. TJS, Leesburg, FL says:

      Heritage needs to edit this article and add the word "trillion" in many locations. Ex: how much energy tax the government will collect – $5.7 trillion.

      The proposed tax is insane. They want us to spend $10 trillion in order to lower temperature by 2/10 of 1 degree. That's if their global warming theory is correct; I am highly confident they are wrong. We ought to be more sure of the science before we decide to cut out 2/3 of our energy – 85% is from fossil fuel, which they want to cut by 80%. Morons. Fools. Idiots. Tyrants.

    19. Joe, Md says:

      Cap and Trade or Crap And Betrayed as I like to call it, is the biggest scam perpetrated on the US since Obama was elected. It is a dangerous bill that will destroy more jobs the any straight up tax increase would. It is just the nail in the USA's coffin, and Obama and his cronies know it. It is part of the master plan to rebuid America their way. Don't fall for any of the crap they are spueing, it like everything he has said since day one are lies.

    20. James Rector, Fayett says:

      All about control of the people. Same as health care. God is in control of our climate, not people. I can remember in the 70.s we were going to freeze to death, now it is climate change, too many climatologist have disputed this notion of Global warming. By the way I do every thing I can not to waste energy and pollute the environment.

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    22. Dan V. Springfield I says:

      Cap and trade is a bill designed to redistribute wealth not designed to prevent global warming or the reemergence of unicorns. This bill allows any company to exceed the bills set limits for a price, the ability to buy the traded shares of the fake carbon credits. This will create another ponzi scheme that will enrich all the players and supporters that have very high hopes this passes and will benefit them at the American consumer's expense. But due to being able to continue releasing co for a price it will not lower co emissions and is not meant to. It's only designed to get in your pocket using false science and the STUPIDITY of the US voting 52%.

    23. Lynn B. DeSpain says:

      THE TAX MAN,:Tax the rich to feed the poor, until there are no rich to tax no more." There are certain things in life that cannot be fixed by pouring money on them, stupidity, ignorance and laziness are but a few.

      Hozro

    24. Linda, Oregon says:

      People, wake up this is just another government generated fraud. This legislature is after more control of the tax payers money in order to give that money to their supporters so they will continue to fund their campaigns and make them rich. Al Gore and all the supporters of this bill are only interested in advancing themselves.

      This old earth has been warming and cooling since it began. Don't believe the fear mongers that try to convince us that it is man made. This is a hoax and the only reason for it is for more government control of our lives and money.

    25. Linda Carlsbad, CA says:

      This cap & tax, has nothing to do with saving anything. This is about telling us what to do, taxing, taxing, more taxing. The American people have their number in Washington, we are standing up. We are millions, they are few!This administrations agenda is to destroy our country. All the Congressmen who go along with this will be voted out!

    26. Angie, WA says:

      It's all about controlling our existence and diverting dollars from the masses to enrich those with energy holdings – better believe that most, if not all, our elected officials have such holdings.

      It's also another job killer-for the USA. Gary Locke Commerce Sec'y told China that we in the US should pay these costs for the goods we import from them – unbelievable! Send the manufacturing jobs overseas then make our citizens pay additional for their belching factories when we buy imports.

      And for those who really think that man is so intelligent that he can control every aspect of this universe, remember the ozone layer remedy. The substitute chemical for aerosol can propellant is apparently more destructive than fluorocarbons. Fancy that. I'm not gambling on this newest roll of the dice.

    27. James E Bauer MD, MD says:

      Creation science reveals that, along with the appearance of Oxygen [O2]-breathing animals on our Earth, there appeared green plants with the natural capability of taking Carbon dioxide [CO2] out of the atmosphere and replacing it with the O2 which we need to survive. Evolution should be so clever!

      The scheme to remove CO2 is thus not only totally unnecessary, but is conceptually a dangerous fraud, profiting only those who, like Al Gore, own businesses to sell "carbon credits".

    28. Lee, Wisconsin says:

      Notice that it is not called global warming anymore. It's climate change. Duh, the climate always has and always will change. Why is Greenland called Greenland? Because it was green when the vikings got there. Despite a huge warming period during the dark ages the polar bears will survive. It's just another liberal scare tactic to prevent people from living their lives worry free.

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    30. Aaron says:

      For all of you that disagree with my statement and the preparation that we all must make. google oil production or peak oil demand and look at the millions of reason why we have to do something people. Do you want to wait till gas is 8.00 or 10.00 a gallon and say oh, we should have done something. There are millions of example to show you what is coming that is going to affect us all. This is a world wide crisis and there are avenues and funding available to all of those that want to be prepared before we are forced to make the changes with out help.

      you decide. please do your self a favor and look this help and you decide whats coming.

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