JUST THE FACTS
August 4, 2008
Defeated last June in the U.S. Senate, America's Climate Security Act would have penalized companies that emit greenhouse gases. Called a "cap-and-trade" program, the bill was basically a tax on fossil fuels that currently provide about 85 percent of America's energy, says Deneen Borelli, a senior fellow with Project 21.
According to Senate testimony by Charles River Associates International:
- The bill would have cost up to $6 trillion nationally over 40 years.
- Up to 3.4 million would disappear by 2020 if such regulations were enacted.
The economic cost of a cap-and-trade bill would hit Michigan especially hard, says Michigan Science. The increase in energy cost would compound the loss of manufacturing jobs in the state and reduce the disposable income of Michigan residents.
A study of the bill conducted by the American Council for Capital Formation (ACCF) found:
- Michigan would lose between 37,400 and 56,200 jobs by 2020 and between 91,490 and 121,786 jobs by 2030.
- The job loss was attributed to lower industrial output due to higher energy prices and greater competition from overseas manufacturers with lower energy costs.
- Multinational corporations would avoid the compliance costs of regulation by exporting jobs out of Michigan and the United States altogether.
- The auto industry, already burdened with job cuts and a downturn in the economy, would be severely challenged to comply with the consequences of global warming regulations.
Higher energy prices also reduce the amount of disposable income in households. The ACCF study reported Michigan would see disposable household income reduced by $933 to $3,024 per year by 2020 and $3,867 to $7,051 by 2030.
Source: Deneen Borelli, "Just The Facts," Michigan Science, No. 7, Spring 2008.
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