NCPA - National Center for Policy Analysis


March 12, 2009

Among the several revenue-raising proposals in President Obama's $3.9-trillion budget proposal is a carbon tax that will impact all American families, says Michelle Bachman at  The President's budget aims to raise $646 billion through a cap-and-trade tax on energy.

Last year, Peter Orszag, who was then Director of the Congressional Budget Office and is now President Obama's Director for the Office of Management and Budget, testified before the House Ways and Means Committee on a similar proposal: 

  • Speaking about a cap-and-trade proposal to cut carbon emissions by 15 percent, he said it would cost the average household about $1,300 a year through higher energy costs; he also noted that working class families would be hardest hit.
  • President Obama's current proposal aims to cut carbon emissions by more than three times that of last year's proposal -- 83 percent.
  • John Feehery, writing in The Hill's Pundits Blog last week, noted that using Director Orszag's analysis, this would mean that the average family will pay close to $4,000 a year, or $333 a month.

The White House seems to acknowledge that the costs of this tax will impact low-income families hardest and suggests a $500-a-year subsidy.  But, that doesn't even cover two-months cost for the average family.  And, it doesn't take into account the increased costs for everything from groceries to school supplies that a carbon tax will also impose on everyone. 

We had a little taste of that last summer with the increased fuel costs adding to the costs of just about all consumer goods, says Bachmann.  Will American families want to return to that budget-busting scenario?

Source: Michele Bachmann, "Carbon Tax Hits All Americans,", March 10, 2009.


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