NCPA - National Center for Policy Analysis


June 3, 2008

With average gas prices across the country approaching $4 a gallon, it may be hard to believe, but the U.S. Senate is considering legislation this week that will further drive up the cost at the pump, says Sen. James Inhofe (R-Okla.).

The Senate is debating a global warming bill that will create the largest expansion of the federal government since FDR's New Deal and the largest tax increase in U.S. history.  The Lieberman-Warner bill (America's Climate Security Act) represents the biggest pork bill ever contemplated with trillions of dollars in giveaways.  The handouts offered by the sponsors of this bill come straight from the pockets of families and workers in the form of lost jobs, higher gas, power and heating bills, and more expensive consumer goods, says Inhofe:

  • Various analyses show that Lieberman-Warner would result in higher prices at the gas pump, between 41 cents and $1 per gallon by 2030.
  • The Congressional Budget Office (CBO) says Lieberman-Warner would effectively raise taxes on Americans by more than $1 trillion over the next 10 years.
  • The federal Energy Information Administration says the bill would result in a 9.5 percent drop in manufacturing output and higher energy costs.

Carbon caps will have an especially harmful impact on low-income Americans and those with fixed incomes.  The poor already face energy costs as a much higher percentage of their income than wealthier Americans:

  • While most Americans spend about 4 percent of their monthly budget on heating their homes or other energy needs, the poorest fifth of Americans spend 19 percent.
  • A 2006 survey of Colorado homeless families with children found that high energy bills were cited as one of the two main reasons they became homeless.

Source: James Inhofe, "We Don't Need a Climate Tax on the Poor," The Wall Street Journal, June 3, 2008.

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