This passage from page 7 “justifying” the tax is telling:
“Domestic policies to address climate change and the related issues of energy security and affordability will involve significant costs and potential revenues, possibly np to several percentage points of annual GDP (Le, eqnal in size to the corporate income tax), Creation of a domestic cap and trade system would require management and oversight consistent with, if not stronger, than existing markets for commodities and government securities…”
From a CEI press release Kudos to Chris Horner for making the FOI request.
by Christine Hall CEI
September 18, 2009
Global Warming Cap-and-Trade Costs Could Hit $300 Billion Annually, Cost Up to Several GDP Points, US Treasury Admits
Treasury Dept Releases Un-redacted Documents Friday Afternoon
Washington, D.C., September 18, 2009―Global warming cap and trade costs could hit $300 billion annually, the Treasury Department admitted in documents released today – late in the afternoon and on the day of the Jewish New Year celebration. The same documents had been released by Treasury earlier this week but had important parts redacted. Now, the document is available in its entirety for public scrutiny.
The new information reveals that Treasury estimates that not only could cap and trade cost $300 billion annually, “domestic policies to address climate change and the related issues of energy security and affordability will involve significant costs and potential revenues, possibly up to several percentage points of annual GDP (i.e. equal in size to the corporate income tax).”
The documents were obtained by CEI Senior Fellow Christopher Horner through a Freedom of Information Act request and revealed in a Friday afternoon release after public attention to an earlier version raised questions of what the administration was hiding.
“Today’s release explains why the administration initially sought to keep its internal aspirations and expectations from the public: The cost of a cap-and-trade plan to businesses and consumers will be enormous,” said Horner. “This candid perspective of what could prove to be the biggest tax increase in our nation’s history now must be openly debated before the American public”.
A cap-and-trade plan, as called for by President Obama, would either immediately sell all carbon dioxide emission permits or sell nearly all after a few years of giving industry most of its permits for free.
View the Treasury Department documents (PDF)
Page 4 has the relevant number
Sarkozy, Merkel want carbon tax on imports
PARIS (AFP) – The leaders of France and Germany called Friday for the United Nations to support a carbon tax on imports from countries who fail to back international efforts to fight global warming.
French President Nicolas Sarkozy and German Chancellor Angela Merkel wrote to UN Secretary General Ban Ki-moon arguing that states that fail to back a deal at a climate summit in Copenhagen in December should be held accountable.
Damned if you do damned if you don’t.
Gene Nemetz (11:24:50) – I believe Chris Horner/CEI released this inthe form of a memo gotten via FOI earlier this week . Treasury may have “officially” released it Friday (under pressure) . I seem to recall Fox carrying this story a few days ago , but am not sure of the day , but I was surprised that WUWT didn’t latch onto it immediately .
Why do politicians think the solution to every problem is a tax?
Just askin’…
OK , Treasury released the unredacted documents Friday . Horner got redacted documents through FOI last week .
Quoting H.R.:
“Why do politicians think the solution to every problem is a tax?”
Commenting:
There is a saying: “To a carpenter, every solution looks like a nail.”
I don’t know who came up with this, but it is priceless.
Sarkozy knows that most of France’s electricity comes from Nuclear Power.
His consituents won’t pay much of a carbon tax.
nice trick – call for taxes on everyone else, but not on your own countrymen.
But to his credit, and unlike our own idiots, at least he remembers who voted for him. And why.
If you read this article:
http://climaterealists.com/index.php?id=4044&linkbox=true
you will find out that the Chinese have figured out the true intention of the C&T policies.
C&P is a break on economic development.
If you intend to live in a country that is tuning down it’s economic development you have to fight it or move to another part of the world where Governments are not as stupid as the ones we have in power today.
Signs of US decline:
http://factsnotfantasy.blogspot.com/
Tes, the President is lying:
http://www.iceagenow.com/Yes_the_President_is_lying.htm
Francis (10:43:40),
To which consumers will these revenues be given? For that matter, to which consumers will revenues from higher taxes on health insurance companies go? This is nothing more than populist income redistribution and the folks that are going to take the biggest hit are the middle-class.
Socialist policies depend on tapping the capitalist economy dry. When there is nothing left we will all be equally poor, though some will always be more equal than others.
It troubles me deeply that we are now faced with economic ruin caused purely by policy. This recession was setup by policy, triggered by policy (timed for the election) and maintained by policy.
When will the mainstream of the Democratic Party wake up and see that this has gone far past simple party gamesmanship? Have we progressed from the October Surprise to the October Revolution?
On April 28, 2009, the U.S. Department of Agricultural signed contract number AG3J141202971961 with Clougherty Packing, LLC of Los Angeles in the amount of $1,191,200 to purchase 760,000 pounds of frozen sliced ham (in 2 pound packages) to be distributed to local organizations that assist the needy such as food banks, food pantries, and soup kitchens. This works out $1.567 per pound. On the day that the widely read web site Drudgreport.com made note of this contract, that source documented similar products selling for 79 cents a pound at Food Lion supermarket.
The Secretary of Agriculture’s own press release defending the contract ended by highlighting what he thought was most important aspect of it: “While the principal purpose of these expenditures is to provide food to those hardest hit by these tough times, the purchases also provide a modest economic benefit of benefiting Americans working at food retailers, manufacturers and transportation companies as well as the farmers and ranchers who produce our food supply.” No mention of how much wealth was destroyed in the process of using government to provide a “modest economic benefit” to so many Americans. (compare to previous mentions that all parties benefit in a free exchange)
This “pork” is a great metaphor for exactly what will happen to the $300 billion this tax will squeeze out of our economy. It will be used to buy 79 cents worth of ham at a cost of $1.57. Further, government bureaucrats and politicians will issue press releases telling us what a great job they are doing for the economy and for protecting the planet.
The median family income in 2008 was $50,233. For every billion of waste, we can kiss the entire income from 20,000 families. This is yet another scheme to spend ourselves into prosperity that only benefits the supporters of big and Bigger government.
A child –
“THE REVENUES RAISED FROM EMISSION PERMITS WOULD BE RETURNED TO CONSUMERS”
An adult –
‘The whole point of cap and trade is to put the United Nations in control of an international system of wealth transfer based on trade in carbon credits’
At any rate, “returned’ is the wrong word. Money will be taken from people who create wealth and given to those that don’t in return for their votes. The people who have the money taken from them won’t ever see it return. It is not greed that makes people object to this, contrary to the Red’s assertion, rather it is the fact that a system like this destroys the wealth producing engine of an economy. It always has and it always will.
Jeff Id (09:33:01) : I love how they imagine more tax is always equivalent to more revenue.
rbateman (11:04:57) : pink slips
I agree Jeff; the way to raise revenues would be to cut taxes—something that is counter intuitive to a politician.
And I agree rbate; there would be more job loses.
It looks like Americans are doing something about the current crop of politicians. The ~1.5 million in Washington at 9/12 Rally tells me so.
There’s a simple way to get rid of the current crop of politicians : don’t vote for them.
Peter Schiff announced that he’s running for Senate. If he can become the Republican nominee in his State he will face Chris Dodd, yes, that Chris Dodd. Having Chris Dodd out of Washington would be a huge step toward fixing Washington.
Peter Schiff announcing his run :
I haven’t read all the posts. I will, but not right now. But at about 300 million people in the US that is $1000 each per year. The math isn’t very hard
Gene Nemetz (11:47:39)
Gene, “cut” spending? Ho ho, you do make me laugh though.
Well, I’ve spent 10 minutes looking for a citation but can’t pull one up. Guess my “Google Mojo” is off tonight…
At any rate, I’m certain I saw an interview with Meg Whitman (on Fox?) as she announced for Governor of California that stated she intended to push for a repeal of the California version of Cap & Tirade as it is a jobs killer. (And California is now over 12% unemployment and still rising…)
A view of the future? One can only hope so.
California is an existence proof of what will happen globally. Back Cap & TAX, jobs and manufacturing flee, unemployment rises until such time as “politicians see the light by feeling the heat”, then a movement will rise to repeal it.
So I think that $300 B is “way low”. It does not allow for all the jobs that will bail for better climate (financial that is…).
But at the end of the day, economic collapse leads to political revolt.
Watch California. It’s starting now.
California is at the point where the most radically positive pro-growth and anti-recessionary agenda would be to simply repeal all state centered environmental legislation.
Mr Smith, nice to hear from you again.
Near the end of the /u-s-treasury-the-costs-of-cap-and-trade-1761-per-year-per-household/ thread, I responded to your last exchange with me. I even offered to pay you for your skills in economics.
As my comment directly relates to the other side of the economic coin of this thread (economic savings from the benefits of increased CO2 verses the cost of regulating CO2) I have copied it here to save you the time of going back to that thread…
Dear Mr. Smith, thank you for your detailed response. I knew I could count on you to provide greater insight. I purposely understated the numbers in regard to increased biomass growth because when I guesstimate I like to understate.
To the basic assumptions you stated we would have to assume that without the benefit of the increase in CO2 the cost of every food would be greater then it is currently due to the law of supply and demand. This would, I think, add significantly to your numbers and would increase the price of every commodity in every part of the economy that uses resources that are also used in farming. Your point that this increased production very likely has prevented more then one war is of course extremely valid.
Of course we have to (if we are pro carbon tax) add the value of millions of tons of carbon that are absorbed by this increased biomass. (A negative feedback rarely calculated) We would have to include the carbon storage of the increased biomass in the oceans also. As mentioned the benefit will continue to increase while the warming decrease.
Yes indeed, you should be well paid to provide a detailed report on this. Unfortunately I (ex-wife, four children) could afford no more then a domestic beer. (-: Hum? Perhaps Mr Mckitrick could encourage a graduate student to do a thesis on this. Do you have his number?
Seriously such a study would generate a lot of publicity. Money still talks in the US of A.
Ok, so I did not offer you much, if I were wealthy I would commision such a study
Thanks,
Mr Anderson
So it’s not $1,761 per American household per year as earlier reported.
$300 billion per year divided among some 103 million households (310 million population with 3 members/household average?), that’s $2,903 per household per year, and that’s for federal carbon taxes alone! If you include carbon taxes by states, counties and cities, an average American household shold be paying extra taxes of more than $3,000 per year!
I doubt that Obama’s cap and trade bill will pass to become a law.
When I was in college there was an interesting study on environmental costs. Can’t post source since this was in the day of libraries. The study was about the predicted costs versus the actual costs after an environmental project or initiative was completed.
The study found some interesting relationships. The first was that businesses did the best job estimating actual costs. The worst were the environmental activists, followed by governments. The numbers were businesses overestimated the costs or underestimated the benefits by a factor of 2 to 3 to the actual cost/benefit determined. Governments underestimated the cost or overestimated the benefits by a factor of 3 to 5 to the actual costs/benefits. Environmental activists underestimated the cost or overestimated the benefits by a factor of 5 to 10 to the actual costs/benefit.
Since this cap and trade has both cost and benefit, you should take the $1500 to $1800 estimate and multiply by about 5 resulting in a $7500 to $9000 close estimate to the previous post of about $10,000. You will also see that the environmental activists are about at their factor 10 off or worse. I have seen their estimates, based on EPA and others; it was at Joe Romm’s, $80 to $175.
Let’s get real, if it only cost a person $100 to $175, much less this figure for a household, then why would we need to be rushed into doing anything at all for decades? Joe needs to do some basic thinking. It either means the proposed cap and trade is worthless and ineffective, or we shouldn’t be doing anything for decades. Which is it? Probably both based on the numbers.
The difference is about what has been proposed that “will make a difference” and what the House bill actually contains. This bill needs to be round filed. As far as it being a moral stance, if the cost estimates are true, the moral of the story is that it was done on the “cheap.”
There isn’t a chance in this world that the revenues would be returned to the taxpayers — and it doesn’t matter what concessions were in the house bill. When this makes it to conference, the democrats would see to it that these revenues go into federal coffers and stay there until spent on federal projects such as health care. They need the money, and this is a cash cow.
Statements that the revenues would be returned are as believable as we will realize $xxxB (put any figure here) through new efficiencies in medicare.
I hope that wws is right about the prospects of passage in an election year. Cap and Trade is likely more toxic to politicians’ futures than CO2 is to planet earth.
Moderator, please delete last post and substitute: I guarantee that any estimates of government revenues from this scam would be way too high, since they presume a functioning economy that we would no longer have. I also wonder why they bother to do the typical Friday afternoon “document dump” anymore, since most media ignore any data that conflicts with the environmentalist movement’s dogma anyway.
WestHoustonGeo (13:21:46) :
_________
Quoting H.R.:
“Why do politicians think the solution to every problem is a tax?”
Commenting:
There is a saying: “To a carpenter, every solution looks like a nail.”
I don’t know who came up with this, but it is priceless.
_____________
Love the thought, but let me improve that saying a little bit:
“To a man with a hammer, every problem looks like a nail.”