The Democrat Energy Plan
Cap and Trade: Caps Economic Growth and Trades Jobs Overseas
Rep. Michael Burgess on the consequences of "cap and tax" legislation:
President Obama and Democrat leaders in Congress expect to raise billions of dollars through an unprecedented “cap and tax” proposal. With this money, they plan to accomplish many of their campaign promises and long-standing party goals – health care and education reform, to name a few.
And they may just get their way. Their proposal will raise taxes on American businesses and families by an expected $646 billion over the next 10 years. Coincidentally, that is more than enough to pay for President Obama’s $634 billion “down payment” on an expansion of government-provided health care.
In just a few short years, you may be paying for several others’ health care by simply flipping on a light switch and turning on the coffee pot each morning.
Cap and tax will increase the daily overhead costs for businesses, increase the costs of running our families to school and to work, and it will destroy jobs and businesses unless they are explicitly protected in the language. Energy Secretary Steven Chu even stated that he believes the policy would "disadvantage" the American economy.
Fortunately, this draft legislation is only a draft. We still have time to make significant changes to this bill to make it better, and I intend to do that in subcommittee and committee.
I, too, believe it is important to safeguard our planet and preserve it for future generations, but the proposed cap and tax is radical and the timing is dangerously wrong. It is a broad-sweeping policy change that will do more harm than good. I would argue that, in its current form, this proposal may do more harm to our economy than any bill that is likely to come before Congress for the rest of this year, or perhaps during my natural lifetime.
Rep. Radanovich Highlights Cap & Trade's Harmful Impacts on CA Agriculture
The third panel for the day has begun. The topic for this session is "Green Jobs and Economic Benefits." Panelists are now making introductory remarks.
The hearings are in recess until 4 p.m.
Rep. Joe Pitts (R-PA) asked the panel how the legislation will avoid unintended consequences for the manufacturing sector. One panelist said the answer was to “watch natural gas.” Pitts then mentioned that cap and tax will make American energy costs rise in comparison to those countries without a similarly controlled system. When he questioned them about preventing job loss and maintaining a competitive economy, their only answer was to focus on completing the transition to a cap and tax nation correctly. The panelists asserted that if the transition was done incorrectly, “it could have a devastating impact on our economy.”
Pitts then asked, “Do you foresee an increase in gas and electricity prices?”
Their answers could be summed up with the first panelist’s response: “It’s not going to be cheap and we just need to face up to that.”
From the House Energy and Commerce Committee:
U.S. Reps. Joe Barton, ranking member on the House Energy and Commerce Committee, and Greg Walden, R-Ore., ranking member on the Oversight and Investigations Subcommittee, today wrote to Department of Energy Secretary Steven Chu and Department of Labor Secretary Hilda Solis asking them to define what a green job is, and how many are expected to be created by the Waxman-Markey global warming bill or similar global warming legislation.
The questions are:
1. What is a green job? Who gets to define what a green job is? What is the authority for this official to make this determination?
2. How was this definition of green jobs developed? Please list all the organizations, both government and private, that provided input in the development of this definition.
3. In which sector(s) of the economy are green jobs envisioned? Has an analysis been performed of the estimated numbers of green jobs that may be created as a result of ACES or other similar climate change legislation? If so, how many such jobs would be created and over what time periods would they be created?
4. Would new green jobs such as those associated with ACES or similar legislation require workers to undertake significant new training and/or education? If so, please describe the nature of that new training and/or education, the anticipated costs and timelines associated with that training and/or education, and who will pay those costs?
5. Would significant numbers of workers have to relocate for green jobs? If so, what are the anticipated numbers of workers that may have to relocate and where would they have to relocate? When defining green jobs, does the definition take into consideration whether a job is located in the U.S. or abroad, or whether a job was transferred abroad from the U.S. as a result of U.S. laws and regulations?
6. Have there been analyses performed that estimate the average wages associated with anticipated green jobs? What is the expected average wage of a green job? How does that compare to the average wage of a non-green job? What is the supporting data for these wage figures?
7. Will green jobs be in addition to non-green jobs or will they replace non-green jobs? If the green jobs are replacing non-green jobs, how many non-green jobs will be lost for every one green job created? If more non-green jobs are lost than the number of green jobs created, is that disparity the result of increased efficiencies or other factors? If other factors, please list those factors and describe how they impact the loss and creation of green jobs and non-green jobs. Please also explain the methodology for determining the net effect on employment.
Here is a copy of the letter.
The video of Rep. Barton questioning Energy Secretary Chu:
Here is a selection of Rep. Marsha Blackburn’s (R-TN) remarks to the panel:
“Laying aside my skepticism of the underlying science that led us to this bill, I would like to address some of my concerns over the legislation itself. There are at least two provisions that we know will be detrimental to the economy at the worst possible moment.
"First, are the renewable electricity standards imposed by this bill? Currently, 3% of our electricity is generated by renewable energy. The Chairman’s bill calls for 25% by 2025. To meet that standard under current electricity usage levels would require 20,000 megawatts of renewable energy to come online each year until 2025.
"I would remind my colleagues that only 10,000 megawatts worth of renewable electricity came online last year. The Energy Information Administration estimates that only 8,000 additional megawatts will come online over the next four years.
"This makes the renewable energy requirements in this bill entirely unrealistic, and that is under current usage rates. This bill also aims to increase electricity usage without accommodating that increased usage in the standard for renewable generation. The proposed standards also happen to be exceedingly expensive. We are saddling our states and our energy consumers with unrealistic demands at prohibitively high prices.
"Secondly, while there are large holes in the Chairman’s bill when it comes to the mechanics of a Cap and Trade proposal, few in this room doubt that we are actually talking about a Cap and Tax system. Electricity rates are going to rise and Washington is going to pocket the profits. I take no comfort from any assurance I hear from my colleagues across the aisle or down the street that energy consumers will be compensated in any way.
"We must be plain, and we must be honest when we discuss this system. It will pull thousands more out of the family budget every year. There is simply no way around it and we are wrong to try and sugar-coat it."
Energy Secretary Chu Gave A Perplexing Answer This Morning
An exchange between Republican Ranking Member on the Energy and Commerce Committee Rep. Joe Barton and Energy Secretary Stephen Chu this morning:
Rep. Joe Barton: “Dr. Chu, you’re our scientist. How did the oil and gas get under Alaska?”
Energy Secretary Steven Chu.: “This is a complicated story, but essentially oil and gas got there as the result of hundreds of millions of years of geology, and in that time also the plates have moved around. And so it’s the combination of where the sources of the oil and gas are and…”
Rep. Barton: “Isn’t it obvious that at one time it was a lot warmer in Alaska and on the North Pole? It wasn’t a big pipeline that we created in Texas and shipped it up there and put it underground so we could now pump it out, was it?”
Sec. Chu: “There are, there’s continental plates that have been drifting around throughout the geological ages.”
Rep. Barton: “So it just drifted up there?”
Sec. Chu: “Ah, that’s certainly what happened.”
As the cap and tax legislation debates continue, one blogger points out how global warming fear mongers are getting to children.
Rep. Michele Bachmann (R-MN) is glad the Weekly Standard indicated the deception of MIT Professor John Reilly. Bachmann, an outspoken critic of the cap and tax bill, has used the number --$3,128 cost per American family if the bill passes -- produced by an MIT study. After Reilly publicly said the number was false, he was debunked but not before the mainstream media and Democrats' bought the lie. Bachmann responds:
I am more skeptical of Washington’s intentions and I believe that the Democrats have no intention of using a cap-and-trade system to deliver rebates to consumers; they want the tax revenue to fund more government spending. Key Democrats – including President Obama and Senators Reid & Conrad – have even said they want to use cap-and-trade to fund their government-run health care plan.
The reality is, it's anybody's guess as to how the cap-and-trade revenues would end up getting spent. What we do know is that you’ll be paying them but it will be the government spending them -- not you -- and that's the problem.
I hope the press is just as quick and eager to correct the report that the GOP's estimate of cap-and-trade's cost is a "pants on fire" falsehood as they were in claiming it.
Rep. Michael Burgess (R-TX) pressed the panelists to admit that jobs can and will go overseas if this energy legislation is passed. Jackson admitted that it was possible that would happen.
Burgess noted that the panelists never specificaly held human beings responsible for global warming, which would be "the fundamental piece of evidence" to prove the bill was necessary.
Chu answered, "There is very strong evidence that the lions share of what we are seeing is due to human activity."
A analysis from the Tax Foundation documents the cost of this cap and tax legislation:
Many U.S. lawmakers view cap and trade as a politically superior non-tax approach to climate policy. However, cap and trade imposes identical economic burdens on households to a similarly designed carbon tax. Using the newly-released 2002 input-output accounts we present new estimates of the distributional impact of a typical cap-and-trade system by income, age, U.S. region and family type. In total, households would face an annual burden of roughly $144.8 billion per year with costs disproportionately borne by low-income households, those under age 25 and over 75 years, those in Southern states, and single parents with dependent children. Using RIMS II multipliers we estimate the broader economic impact of cap and trade. Depending on how the system is structured, cap and trade could reduce U.S. employment by 965,000 jobs, household earnings by $37.8 billion, and economic output by $136 billion per year or roughly $1,145 per household. Lawmakers weighing the costs and benefits of climate policy should be aware that cap and trade would impose a significant and regressive annual burden on U.S. households, and would not represent a "tax free" way to reduce greenhouse gas emissions.
Rep. John Shimkus (R-IL) just completed his turn, calling this bill "the largest assault on democracy and freedom in this country that I have ever experienced." Part of his discussion with the panelists is as follows:
Shimkus: Has China or India agreed to some type of low carbon fuel standard?
Lahood: I don't know.
Shimkus: Has China or India agreed to an international regime to cap carbon dioxide?
Shimkus: What is the largest emitter of methane gas?
Shimkus: I think the largest emitter of methane gas is wetlands. If wetlands are the largest emitter of methane, you're not proposing draining wetlands are you?
Shimkus later continued, "My belief is that this is an intentional move to deceive us so that we're not alowed to do the cost benefit anaylsis...
...This is the height of hypocrisy...to bring a bill without the data."
He then asked Jackson if she knew how many coal miner jobs in Ohio were lost due to the Clean Air Act. When she said she didn't know, he responded that 35,000 jobs was the answer.
"Those of us who want jobs are going to try and defeat this bill."
Rep. Steve Scalise (R-LA) just finished speaking. He asked the panelists about job losses Americans will incur if the legislation passes. He also asked about specifics on allowances for carbon emissions, numbers which are not included in the bill. Jackson had no direct answer on the jobs question though did say President Obama had specified a number for allowances.
Here is Rep. Mary Fallin (R-OK) speaking on the legislation at a presser this morning:
I’m very fortunate to come from a state that has tremendous energy production. And in my state, my oil and gas, my energy producers in Oklahoma are very concerned about the Obama Administration’s proposals on energy. We want to step forth today as Republicans and tell the President we are willing to work with him on reducing our dependence on foreign energy and helping to find alternative forms of energy. But the way he is proposing it, with increasing taxes on oil and gas and production and exploration will devastate the energy industry especially in Oklahoma.
We’ve already seen a 39% reduction in gross production taxes in our state, which is a $2 billion drop out of a $7 billion budget. We’re already seeing job loss. We’re already seeing companies, and I’ll give you one specific example of a company in Tulsa who said that they last year drilled 36 wells and this year they plan on drilling zero. No production, because they are waiting to see what Congress is going do with Cap and Trade and with the proposed tax increases--energy taxes on the energy industry. It is estimated that the proposed tax increases in President Obama’s budget will increase taxes on energy by $30 billion and cost up to 7 million jobs at a time when our economy is in a downturn and a time when people are concerned about keeping their jobs and paying their bills. And the portion of the population that would be affected by these energy tax increases will be our poor and our elderly and those who have to spend a larger portion of their income on paying for energy costs.
Whether it is higher utility costs or higher gasoline costs, it’s estimated these new energy taxes, what we call Cap and Tax--Cap and Trade, could cost the average family $3,000 a year in increase costs. And once again, at a time when our economy is down, when people are struggling to pay their bills, stay in their homes, and keep their jobs is not a good time be enacting policies that will hurt energy production.
Rep. Marsha Blackburn (R-TN) is now speaking:
"When you look at the low carbon fuel standard in the bill, what do you see that doing to prices at the pump?" she asked.
LaHood: I wouldn't have any idea...
Chu: It will increase the price at the pump...
"So in other words, you all see this as increasing the cost to the American consumer?" Blackburn pressured.
Chu: We see this as shifting costs...
Glenn Thrush reports that House Republican Chairman Mike Pence called the cap and tax legislation "an economic declaration of war on the Mid-West."
Pence wants the Democrats to include more costs and numbers in the bill. Pence heads the American Energy Solutions Group.
Rep. Mike Rogers (R-MI) thinks its funny that the 111th Congress says they've done a lot for the auto industry.
"The proposal for cap and tax will raise to energy rates for producing everything in the U.S.
...If we dramatically raise the rates of electricity, we will not be competitive when it comes to building anything in the U.S. It's an absolute slap in the face to anyone that got up and built good cars...
...The fact that you stand before us and tell us you have done more for the automobile companies...put a bur under my saddle...we certainly don't think so..."
The entire premise behind a cap and tax energy proposal is to punish those who produce, thereby punishing those who consume, which by my quick math amounts to everyone in the United States. Unfortunately, the sadistic nature of radical environmentalism is the disproportionate impact on the poor. While there are some families in this country who can afford to be burdened by a $3,128 energy tax—the vast majority cannot.
Rep. Lee Terry (R-NE) is speaking to the panel now. He asks, "In regard to methane...what industry has to worry about [it]?...What is the largest emitter of methane gas?"
Hon. Lisa Jackson: "Livestock."
Terry: "is it the EPA's plan to start regulating methane?"
Jackson: "No plan to regulate..."
Terry: "If nothing is in this bill that exempts the cattle industry, won't cattle have to be regulated?"
Jackson answered that she hadn't read the whole bill and would have to check.
Rep. Greg Walden (R-OR) just asked each panelist if they had actually read the 648-page document. They all said no.
Politico just published a piece reporting on Secretary of Energy Stephen Chu's call for a cap on carbon pollution this morning.
“We can neither let our planet get too hot nor let our economy grow too cold...We must get off the sidelines of the clean energy race and play to win,” Chu said.
Rep. Mary Bono Mack (R-CA) is speaking now:
My congressional district is one of the top five hardest hit in the housing crisis...this is important to me and my district. I believe in innovation and I believe there is a lot in this bil that can go a long way for energy independence. But..I have very deep concerns about the cost and what this will do to my constituents California's rates are ...higher than the rest of the nation.
...My colleague [Rep. Upton], has asked each of you...what will this do fro the cost of energy for cosumers and I look forward to your answers.
Bono Mack had specific questions for each of the panelists regarding diesel fuel as well.
Why are cap and tax opponents so fired up? President Barack Obama summed it up nicely: "Energy prices will necessarily skyrocket" if this kind of a plan passes. American taxpayers will shoulder that burden. Here's the clip:
Rep. Ed Whitfield (KY) is speaking to the panel now. Whitfield released a statement yesterday on the legislation:
“While climate change may be one of the most urgent problems facing our country, the way this bill affects our production of electricity and the production of the fuel we use for our transportation needs in America may very well dwarf our climate change problems,” Whitfield said. “It is essential that as we move forward to produce cleaner energy we balance the need for cleaner fuel sources versus the need for protecting jobs in the U.S. and keeping our country competitive in the global market place.”
"Should there be a seperate title in this bill for nuclear energy?" asked Rep. Cliff Stearns (R-FL) He repeatedly asked for a yes or not answer. Secretary of Energy Chu would not say yes or no.
Human Events' covered the hearings today in a piece by reporter Connie Hair. Hair spoke with House Republican Chairman Mike Pence, who also heads the American Energy Solutions Group, is quoted in the piece:
"We don’t believe that a draconian national energy tax dropped on top of a coal-burning industry principally that -- according to the President of the United States last year -- will cause utility rates to ‘skyrocket’ is the right approach. … Since we arrived on Capitol Hill we’ve heard a lot of good things about working together and what we have seen is the opposite. What we have seen is closed rules, limited amendments, last minute introduction; we’ve seen massive, hundreds of billions of dollars of legislation that’s been brought to the floor -- twelve hours to review it, twenty-four hours to review it. Our concern would be that the American people are entitled to count the cost of this cap and trade legislation and not wait until the day before the bill comes out of committee and goes to the floor and passes to be told what it will cost.”
Barton questioned the EPA's Lisa Jackson on how C02 will literally harm the earth and harm individuals. He asked if there is evidence of C02 causing disease or death.
He moved on to Secretary of Transportation Ray LaHood, asking LaHood what he knows about specific allocations in the bill for the automotive industry.
Barton then asked Secretary of Energy Stephen Chu a question as well.
The panelists were unable to provide sufficient answers to Barton's specified questions before time ran out.
Cap and tax could cost families more than $3,900 per year -- and that's no lie
The Weekly Standard reported today on the unprecedented energy costs that will burden American families if the Democrats' cap and tax legislation is passed. Republicans have commented that the legislation could cost up to $3,900 per year per family, according to an MIT study. Democrats' and mainstream media outlets passed this number off as false after MIT professor John Reilly said it was. But Reilly was deceitful in this claim. The confusion that resumed is broken down in this piece, which lays out Reilly's bewildering narrative and game changing personal opinons on how the cost is actually doled out.
Rep. Fred Upton (R-MI) just spoke and asked the following questions:
Will the legislation increase energy costs?
Will it result in American jobs being shipped overseas?
What is the cumulative cost per household?
How much will the legislation actualy reduce global temperatures, if at all?
He pointed out that the EU's cap and tax plan was a failure.
"The stakes are high, the planet is warming," he admitted but said that cap and tax would hurt our economy and other options should be considered.
After Democrat Energy and Commerce Chairman Rep. Henry Waxman (D-CA) opened the hearings this morning, House Republican Energy and Commerce Ranking Members Rep. Joe Barton (TX) gave his opening remarks. Here is a selection:
Mr. Chairman, we cannot kick our economy while it is down. Instead of supporting the notion that skyrocketing energy prices are good for America, let’s get busy accelerating the development and deployment of low-carbon technologies and getting American workers back at what they do best: working. Under the Waxman-Markey draft we are capping our economy and trading away our jobs. We are instituting a regressive energy tax on Americans already enduring high unemployment, lost 401(k)s, and rampant home foreclosures. The Waxman-Markey discussion draft is a web of increased regulation that will entangle the economy into paralysis. I cannot in good conscience support such a proposal.
Yesterday, Politico called this the "mother of all climate weeks" and they could be right. This morning marks the beginning of a major hearing, including 54 witnesses to testify on the controversial cap and tax legislation proposed by Energy and Commerce Committee Chairman Henry A. Waxman and Chairman of the Energy and Environment Subcommittee and Select Committee on Global Warming Edward J. Markey.
The "American Clean Energy and Security Act of 2009" (ACES) aims to impose cap and trade regulations and witnesses from both sides of the aisle, including former Vice President Al Gore, are scheduled to speak on a number of panels in the next three days.
The debate, conveniently scheduled to begin on Earth Day, will be closely monitored by President Obama's team. Obama is in Iowa today, touting the bill's promise to create more renewable energy jobs. However, studies suggest that up to 7 million jobs could be lost due to the bill's massive regulation and imposition on hard working Americans and industries.
The hearings begin today at 9:30am, beginning with a Panel titled "Administration Views on the ACES Discussion Draft,' with by the Environmental Protection Agency's (EPA) Hon. Lisa Jackson. Secretary of Energy Hon. Stephen Chu will follow and the panel will close with Secretary of Transportation Hon. Ray Lahood.
Republicans and moderate Democrats' hope testimonies will lean in their favor, though Waxman and supportive Democrats have said they aim to pass the legislation by the Memorial Day recess.
House Republican Chairman Mike Pence was tapped by House Leader John Boehner to head the GOP Energy Solutions Group, which is working to create Republican alternatives to the Democrats’ bill, which is short on numbers and cost.
The debate process is scheduled to proceed consistently over the next few weeks. You can find Republican anaylsis of the bill here and GOP.gov will have all your coverage.