Senate Democrats led by John Kerry (MA) are expected to unveil their new national energy legislation on Monday, April 26th. It will be known as the American Power Act but the details are still secret. The legislation is expected to appeal to conservatives by expanding nuclear power and allowing more off shore drilling.
Its fate could well be determined by the U.S. Chamber of Commerce which is now involved in negotiations with the Obama administration. The Chamber was in forefront of the opposition to the climate change legislation in the House, but they could now shift sides if the bill is altered significantly.
President Obama said on Friday his administration would shift its focus to climate change after finishing financial regulatory reform. The President said “This is one of these foundational priorities from my perspective that has to be done soon.”
The cap and trade national energy tax passed the House last year on a 219 to 212 vote. The bill would require emissions of greenhouse gases to be reduced by 17 percent by 2020. Speaker Pelosi secured the victory despite the opposition of 44 Democrats.
If enacted cap and trade would be the largest tax increase in American history, and the Congressional Budget Office (CBO) estimated the cost at close to a trillion dollars. CBO said the average American household could pay an additional $1,600 a year because of cap and trade, while other studies had a higher cost. The House passed the measure despite the fact that only 33 percent of voters believe global warming is mainly caused by human activity.
This was one of the major promises in last year’s presidential campaign. In January of 2008, Sen. Barack Obama (D-IL) described his proposal:
Under my plan of a cap-and-trade system, electricity rates would necessarily skyrocket. Coal-powered plants…natural gas…whatever the plants were, whatever the industry was…would have to retrofit their operations. That will cost money. They will pass that money on to consumers…So if somebody wants to build a coal-powered plant, they can; it’s just that it will bankrupt them because they’re going to be charged a huge sum for all that greenhouse gas that’s being omitted.
The good news is that the prospects for stopping cap and trade are excellent, and as of today the Democrats only have 26 solid votes in favor of the House plan. Interior Secretary Ken Salazar has signaled the upcoming Democratic strategy change by saying, “I think the term ‘cap-and-trade’ is not in the lexicon anymore.” Even Senator Barbara Boxer (D-CA), the Chairman of the Environment and Public Works Committee, has acknowledged that Congress may take years before it passes a global warming cap and trade bill.
The new energy legislation will be somewhat similar to health care. The House passed a health care public option but it was immediately rejected by the Senate. Now the Senate is expected to abandon cap and trade. The editorial in yesterday’s Christian Science Monitor noted:
A successful US cap-and-trade program in the 1990s reduced emissions known to cause acid rain from coal-burning plants. But the program was limited in its scope, and simple. Relatively few plants slowly switched to low-sulfur coal or added scrubbers.
Scaling up this idea for greenhouse-gas emissions – and allowing the trading of permits for green projects around the world – is asking for trouble. Public confidence in curbing global warming could nose-dive if a cap-and-trade plan results in a slew of dubious schemes.
One climate bill reportedly to be introduced in the Senate may dilute a cap-and-trade system by also offering a gasoline tax – a proven way to cut the burning of fossil fuels but one that may be anathema to voters. Before Congress leaps into cap-and-trade, it should take a lesson from voluntary offsets: Buyer beware.
As usual, radio commentator Rush Limbaugh is speaking for many conservatives in questioning the need for any climate change legislation. He recently said, “Computer models can not predict within hours where the wind will take the ash cloud from Iceland. Nevertheless, we are supposed to significantly alter our lives because of what similar computer models say global climate temperatures are going to be in 50 years. All of liberalism is a giant hoax. It’s just a giant lie with a bunch of subset of lies to support the big one.”