Cap-And-Trade Will Hammer Consumers
At a time when proposals for higher taxes are politically unpopular, Congress is coming up with other strategies to raise revenues at the expense of the American public.
Key congressional committees are expected to begin debating legislation that would impose mandatory limits on greenhouse-gas emissions. If Congress is successful, the average American will not be victimized as a taxpayer, but as a consumer.
The proposed legislation would create a European-style, market-based system that caps the maximum allowable amounts of carbon dioxide from power plants, manufacturers and vehicles.
If companies emit more than their cap allows, they must buy "carbon permits" on the market from companies that have extra ones. This cap-and-trade system is designed to give companies an incentive to reduce emissions, but unknowing consumers would be taxed through higher home energy bills and the rising cost of fuel, food and consumer products.
When Europe launched its system in 2005 as a way to meet its targets under the Kyoto Protocol, it cast itself as a leader in the fight against global warming. But Europe's first three years of cap and trade have not worked as intended. Emissions have risen.
With cap and trade, a significant cost has fallen on their economies from lost competitiveness, lost jobs and lost investment. If we're not careful, carbon cap and trade in the U.S. could be disastrous, especially if it is linked to Europe's system.
~From my commentary in today's Investor's Business Daily