I try hard to stay away from controversial political issues, but this is one piece of legislation that will have a major impact on our economy. This is bad law for many reasons. Here are just a few:
1. It will create a brand new bubble called – carbon credits. This trillion dollar market barely exists now. But if the law is implemented, the new carbon credit market will virtually be a repeat of the commodities- market casino with one exception – the rise in prices will be government mandated. Goldman Sachs won’t even have to rig the game. It will be rigged in advance.
2. It is the single largest tax increase in history disguised as an environmental plan. It provides the government the opportunity to establish fines and punishments on any business found not to be in compliance. Look out if you’re business is republican or conservative organization.
3. The price of Energy will shoot through the roof. Arguments over how high the increase will be in the first year are not as important as how much higher it will go every succeeding year.
4. As the G8 Meeting concluded with support for the bill, representatives from both China and India scoffed at joining the Cap and Trade fiasco. This means that products made in the USA will be a lot more expensive than similar products made in China and India. We will definitely be in a competitive disadvantage as we try to compete in the global economy. On Tuesday, Indian Environment Minister Jairam Ramesh said that India “will not accept any emission-reduction target, period. This is a non-negotiable stand.”
On Thursday, China’s vice foreign minister, He Yafei, told reporters in Beijing that China is “firmly opposed” to any measures that will impose trade penalties on countries that fail to limit their carbon dioxide emissions. “We are firmly against such attempts to advance trade protectionism under the pretext of climate change. It is not conducive to world economic recovery. It serves nobody’s interests.”
If you like poverty, inefficiency, and bureaucratic controls over the economy, and therefore control over your choices, the “climate change” movement is ideal.
If you want to subsidize China and India, neither of which will enforce the rules laid down by unelected international bureaucrats, this movement is for you.
If you want to pay more for less energy, there is no better way than to pass the cap and tax bill which the House has passed. It will be sent to the U.S. Senate next week.
The rest of us should oppose it.