The ConservativeXpress: Barry's Budget Bullsh*t 2.0: The Facts, The Myths and the Lies Behind Obama's "Cap and Trade"

Thursday, February 26, 2009

Barry's Budget Bullsh*t 2.0: The Facts, The Myths and the Lies Behind Obama's "Cap and Trade"

Cap and Trade will not work! It will not generate revenue! It will cost trillions and it will cause more unemployment. (See below)

Energy costs will rise, but the radical environmental left will be appeased by Dear Leader.

And The Obama Administration will get away with all of this, without much real scrutiny, because of those blinded by the media and ObamaMania. Thanks, in advance, for helping to run our country into the ground you ignorant Liberals.

The grand larceny and dishonesty in all of this nonsense is that current White House budget director Peter Orszag, misled Congress last fall and is misrepresenting the facts of cap-and-trade. Orszag was director of the Congressional Budget Office when its report on cap-and-trade was released. The report (see below) proves how consumer energy costs will rise, jobs will be lost and the Federal Deficit will grow.

From Breitbart:

President Barack Obama will propose raising new revenue through a greenhouse gas cap and emissions trading scheme when he unveils his first budget on Thursday, US media reported.

The budget he will present assumes an emissions trading system will generate revenue by 2012, the Washington Post reported.

Fifteen billion dollars of the money generated would be directed to clean-energy projects, the Post said, citing sources familiar with the document.

Another 60 billion would go to tax credits for lower- and middle-income working families, and the rest to help families, small businesses and communities deal with higher energy costs, the paper reported.

The Post cited testimony to Congress in September by Peter Orszag, currently Obama's budget director, estimating that revenue from a cap-and-trade scheme could reach 112 billion dollars by 2012.

According to Orszag, who at the time was director of the Congressional Budget Office, the program -- which would force companies to buy permits if they exceed pollution emission limits -- could generate between 50 and 300 billion dollars a year by 2020.

The New York Times also reported that the projected revenues would subsidize research and development of alternative energy sources.

The recently passed economic stimulus package already includes billions of dollars to help develop a national electricity grid to distribute energy from alternative energy sources such as wind farms.

Carbon dioxide, methane and other greenhouse gasses are the main culprits in causing global warming.

***

From the official White House Budget. View the pdf here.

The CBO defines cap-and-trade:

Under a cap-and-trade program for carbon dioxide emissions, policymakers would set a limit on the total amount of CO2 that could be emitted in a given period—the “cap”—and would issue rights, or allowances, corresponding to that level of emissions. Entities that were subject to the cap (such as coal mines, oil importers, refineries, or electric utilities, depending on the proposal) would be required to hold allowances for their CO2 emissions. After the allowances were initially distributed, entities would be free to buy and sell them—the “trade” part of the program—and the price of allowances would adjust to reflect the cost of meeting the emission cap.

The problem for Americans is the cost of the meeting these "caps" would be borne by the consumer. Just as companies do not truly pay corporate taxes (the pass the cost down to the consumer), energy companies will add this expense to the cost of, say, gas, oil, heating, and electricity.

In essence, this creates a regressive tax as lower-income families would pay a much larger burden relative to their total income.

In addition, the burden faced by companies affected by cap-and-trade will lead to layoffs. Also, financial investment into the energy sector would decrease, or the value of such investments will decrease, creating the same net negative economic effect on Americans.

The CBO also estimates that a 23% cut on CO2 emissions will devalue coal stocks by 54%, lower oil and natural gas stock values by 20%, and a 4% decline for electric companies.

The Federal Budget Deficit will also grow under cap-and-trade, the CBO reports.

A cap-and-trade program for CO2 emissions would tend to increase government spending and decrease revenues. Like other consumers, the government would face higher prices for energy and other carbon-intensive goods and services. In addition, by leading to a decline in the production of such goods and services, the cap would cause a decline in the taxes collected on corporate profits. If the government wanted to provide the same level of services without increasing the budget deficit, it would have to either raise taxes or use part of the value of the allowances to cover the changes in federal outlays and revenues.