CAP AND SPEND
June 3, 2008
As the Senate opens debate on its mammoth carbon regulation program this week, the phrase of the hour is "cap and trade." This sounds innocuous enough, however, anyone who looks at the legislative details will quickly see that a better description is cap and spend. This is easily the largest income redistribution scheme since the income tax, says the Wall Street Journal.
- Sen. Boxer expects to scoop up carbon credit auction revenues of some $3.32 trillion by 2050.
- Some $802 billion would go for "relief" for low-income taxpayers, to offset the higher cost of lighting homes or driving cars.
- There's also $190 billion to fund training for "green-collar jobs," which are supposed to replace the jobs that will be lost in carbon-emitting industries.
- Some $342 billion would be spent on international aid, $171 billion for mass transit, and untold billions for alternative energy and research.
The bill also tries to buy off businesses that might otherwise try to defeat the legislation, says the Journal:
- Carbon-heavy manufacturers like steel and cement will get $213 billion "to help them adjust," while fossil-fuel utilities will get $307 billion in "transition assistance."
- Oil refiners, a powerful lobby with many friends in the Senate, will receive $34 billion and will probably extract a larger ransom if cap and trade ever does become law.
- The revenue handouts reach an astonishing total of more than $6.7 trillion.
- Even the cap-and-trade friendly Environmental Protection Agency estimates that the bill would reduce GDP between $1 trillion and $2.8 trillion by 2050.
All of this helps explain why so many in Congress are so enamored of "doing something" about global warming. They would lay claim to a vast new chunk of the private economy and enhance their own political power, says the Journal.
Source: Editorial, "Cap and Spend," Wall Street Journal, June 2, 2008.
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