The Wall Street Journal’s Kimberley Strassel reports today that the businesses in the U.S. Climate Action Partnership are beginning to realize that the cap and trade was never about global warming:
“People are learning,” says William Kovacs, vice president of environment, technology and regulatory affairs at the U.S. Chamber of Commerce (which has been cautious about embracing a climate plan). “The Obama budget did more to help us consolidate and coalesce the business community than anything we could have done. It’s opened eyes to the fact that this is about a social welfare transfer system, not about climate.”
Nothing makes this more clear than President Barack Obama’s budget. Obama’s budget promises to raise $650 billion in revenues by selling carbon permits (which are the exact same thing as an energy tax). Only $150 billion of that pot of money will go to alternative energy production. The rest goes to pay for income redistribution in the form of income tax “cuts” for people that don’t pay income taxes.
But that is just the beginning. That $650 billion total low-balls the amount that a cap and trade system could raise if 100% of credits were auctioned off at the levels of carbon reduction that Obama wants. The Center for Data Analysis at The Heritage Foundation analyzed the economic impact of the less aggressive Lieberman-Warner cap-and-trade. We found that total value of the allowances (the government auctioned permits whose cost is passed along to energy consumers) would be at least $1,622,848,000,000 for the years 2012 to 2019.
In other words, if 100% of the permits were auctioned off, the left would have almost another trillion dollars to spend on new social programs. Or as Obama’s budget euphemistically puts it, the money be used “to further compensate the public.