The Lieberman-Warner “Climate Security Act” (S. 2191) is scheduled for a voteÂ next week in the USÂ Senate.Â The cap-and-trade scheme created by the bill would set an arbitrary ceiling on how much carbon can be produced by a given company and allows a company operating below that cap to sell credits to over-producing companies. The credits would be traded on a market not unlike a stock exchange, with brokers poised to cash in on commissions for trading paper that represents theoretical potential pollution.
This bill would create a huge expansion in the federal government’s size and power.Â The Congressional Budget Office (CBO) has said that this bill will result in $1.2 trillion in new federal revenue between 2009 and 2018. The CBO also stated it wouldÂ levy $90 billion a year in unfunded private sector mandates. The reportÂ shows that most of the cost of the bill would ultimately be passed on to consumers.
The Wall Street Journal suggests the Lieberman-Warner billÂ would beÂ “the most extensive government reorganization of the American economy since the 1930s.” And they probably have that right. Literally, from thin air, a whole new industry based on carbon trading will spring up, and that industry will touch and profit from every aspect of the economy. Nothing will be free from the effects of this legislation.
Accelerating the already rapid increases in the price of energy is the first, most obvious consequence of the bill, butÂ increased costs willÂ roll through our entire economy with every product and service seeing a commensurate price increase. Scarcity will be artificially introduced into the supply and demand environment of materials that would otherwise be abundant by restricting the energy needed to produce them. Everything will cost more, and because the new economic situation created by the bill doesnâ€™t add to the nationâ€™s productivity or create wealth of any kind, wages will not rise in proportion. The spending power of the dollar will simply diminish. Conservative estimates predict a drop in gross domestic product (GDP) of 4 – 6%.
The Lieberman-Warner bill will create dozens of new bureaucracies and hundreds of new regulations will come into being. This ambitious takeover of the economy will change regulations for fish and wildlife management, firefighting, air conditioning, space heater use, forestry, public health, utilities, taxes, corporations and more.
The bill is so far reaching itâ€™s difficult to foresee all of the consequences, but the economic burden created by it is obvious. There can be no doubt Lieberman-Warner will leave us a poorer nation if enacted.
Visit NoCapAndTrade.com to sign a petition and send a message to your elected officials.
Read How Minnesota will be Affected by the Lieberman-Warner Climate Change Legislation at The Heritage Foundation.