Free Markets, Free People

Energy

The EPA Says Cap-And-Trade Will Have No Effect Without China

But Energy Secretary Chu, when asked if he agreed with an EPA chart which depicted that, said, without explanation, that he did not:

During a hearing today in the Senate Environment and Public Works Committee, EPA Administrator Jackson confirmed an EPA analysis showing that unilateral U.S. action to reduce greenhouse gas emissions would have no effect on climate. Moreover, when presented with an EPA chart depicting that outcome, Energy Secretary Steven Chu said he disagreed with EPA’s analysis.

“I believe the central parts of the [EPA] chart are that U.S. action alone will not impact world CO2 levels,” Administrator Jackson said.

Sen. James Inhofe (R-Okla.) presented the chart to both Jackson and Secretary Chu, which shows that meaningful emissions reductions cannot occur without aggressive action by China, India, and other developing countries. “I am encouraged that Administrator Jackson agrees that unilateral action by the U.S. will be all cost for no climate gain,” Sen. Inhofe said. “With China and India recently issuing statements of defiant opposition to mandatory emissions controls, acting alone through the job-killing Waxman-Markey bill would impose severe economic burdens on American consumers, businesses, and families, all without any impact on climate.”

You can watch Jackson confirm it and Chu deny it here:

Click through at the first link to see the chart – it’s rather hard to read, but the EPA analysis depicted on it essentially says what Inhofe points out – that without China and India and other developing countries, cap-and-trade will have no beneficial effect on the overall reduction of CO2 emissions.

Of course what’s most interesting is to watch “Mr. Science”, Secretary Chu, reject the EPA’s analysis without offering a single justification for such rejection.

Science over ideology, or so it was promised. It sure isn’t evident in Chu’s one word answer to the question posed to him.

~McQ

Cap-and-Trade Bill: The Home Invasion

One of the single most important reasons we’ve been railing against the push for universal health care around here is because, at bottom, it will result in a massive loss of individual freedom. Aside from the physicians who will be treated like slaves (the only possibility if their services are considered a “right”), government will have every reason to control how we live our lives since, after all, if its paying for our health care then it has a vested interest in how we live our lives. Too much sugar, Tylenol or cigarettes? Well you’ll just have to quit or pay heavy fines or even go without health care altogether. Indeed, this is how virtually all bureaucracy works — i.e. once the state has responsibility for some part of your life, it starts taking over greater and greater portions thereof. As it turns out, cap-and-trade will be no different:

Let me introduce you to a little section of the Waxman-Markey cap-and-trade bill called the “Building Energy Performance Labeling Program”. It’s section 304 [ed. – It’s actually Section 204] of the bill and it says, basically, that your house belongs to the state. See, the Federal Government really wants a country full of energy-efficient homes, so much so that the bill mandates that new homes be 30 percent more energy efficient than the current building code on the very day the law is signed. That efficiency goes up to 50 percent by 2014 and only goes higher from there, all the way to 2030. That, by the way, is not merely a target but a requirement of the law. New homes must reach those efficiency targets no matter what.

But what does that have to do with current homeowners like you? Well, I’m glad you asked. You’re certainly not off the hook, no way, no how. Here’s what the Democrats have planned for you. The program requires that states label their buildings so that we can all know how efficient every building (that includes residential and non-residential buildings) is and it requires that the information be made public.

First, a couple of corrections: (1) The “Building Energy Performance Labeling Program” is in Section 204 of the bill; (2) Section 304 of the Energy Conservation and Production Act (42 U.S.C. 6833) is amended by Section 201 of this bill to mandate the efficiency standards set forth above.

Taking these in order, the labeling program essentially coerces the states into adopting the federal standards set forth in the bill for identifying and reporting the energy efficiency of each structure, whether residential or commercial. Essentially this means that Uncle Sam will get all the information it wants about your energy use in the home by strong-arming the states into gathering it for them.

That’s bad enough, but it’s the amendment to Section 304 of the Energy Conservation and Production Act that really inserts the feds into your life. That’s where the efficiency mandates are laid out in Congress’ attempt to create a national building code:

(c) State Adoption of Energy Efficiency Building Codes-

‘(1) REQUIREMENT- Not later than 1 year after a national energy efficiency building code for residential or commercial buildings is established or revised under subsection (b), each State–

‘(A) shall–

‘(i) review and update the provisions of its building code regarding energy efficiency to meet or exceed the target met in the new national code, to achieve equivalent or greater energy savings;

‘(ii) document, where local governments establish building codes, that local governments representing not less than 80 percent of the State’s urban population have adopted the new national code, or have adopted local codes that meet or exceed the target met in the new national code to achieve equivalent or greater energy savings; or

‘(iii) adopt the new national code; and

‘(B) shall provide a certification to the Secretary demonstrating that energy efficiency building code provisions that apply throughout the State meet or exceed the target met by the new national code, to achieve equivalent or greater energy savings.

If states or localities fail to adopt measures implementing or exceeding the efficiency standards promulgated under this bill, then the federal standards simply become the law of that land:

(d) Application of National Code to State and Local Jurisdictions-

‘(1) IN GENERAL- Upon the expiration of 1 year after a national energy efficiency building code is established under subsection (b), in any jurisdiction where the State has not had a certification relating to that code accepted by the Secretary under subsection (c)(2)(B), and the local government has not had a certification relating to that code accepted by the Secretary under subsection (e)(6)(B), the national code shall become the applicable energy efficiency building code for such jurisdiction.

This is a massive arrogation of power to the federal government, and an intolerable invasion of individual property rights. In order to avoid a fairly blatant exercise of unconstitutional authority, the bill essentially denies federal funds to states that do not comply. However, it also leaves wide open just how compliance will be enforced:

‘(f) Federal Enforcement- Where a State fails and local governments in that State also fail to enforce the applicable State or national energy efficiency building codes, the Secretary shall enforce such codes, as follows:

‘(1) The Secretary shall establish, by rule, within 2 years after the date of enactment of the American Clean Energy and Security Act of 2009, an energy efficiency building code enforcement capability.

‘(2) Such enforcement capability shall be designed to achieve 90 percent compliance with such code in any State within 1 year after the date of the Secretary’s determination that such State is out of compliance with this section.

‘(3) The Secretary may set and collect reasonable inspection fees to cover the costs of inspections required for such enforcement. Revenue from fees collected shall be available to the Secretary to carry out the requirements of this section upon appropriation.

‘(g) Enforcement Procedures- (1) The Secretary shall assess a civil penalty for violations of this section, pursuant to subsection (d)(3), in accordance with the procedures described in section 333(d) of the Energy Policy and Conservation Act (42 U.S.C. 6303). The United States district courts shall also have jurisdiction to restrain any violation of this section or rules adopted thereunder, in accordance with the procedures described in section 334 of the Energy Policy and Conservation Act (42 U.S.C. 6304).‘(2) Each day of unlawful occupancy shall be considered a separate violation.‘(3) In the event a building constructed out of compliance with the applicable code has been conveyed by a knowing builder or knowing seller to an unknowing purchaser, the builder or seller shall be the violator. The Secretary shall propose and, not later than three years after the date of enactment of the American Clean Energy and Security Act of 2009, shall determine and adopt by rule what shall constitute violations of the energy efficiency building codes to be enforced pursuant to this section, and the penalties that shall apply to violators. To the extent that the Secretary determines that the authority to adopt and impose such violations and penalties by rule requires further statutory authority, the Secretary shall report such determination to Congress as soon as such determination is made, but not later than one year after the enactment of the American Clean Energy and Security Act of 2009.

Subsection g above appears to empower the Secretary to assess civil penalties against individuals for noncompliance. I say “appears” because the italicized portion does not actually show up when you view the bill, only when you cut and paste it as I’ve done here (I never considered the idea that “transparency” in law-making meant “making the law transparent”). Of course, even without that italicized section, it’s pretty easy to see where this is going. If your home isn’t as efficient as the federal government wants it to be, then you will probably be facing some sort of civil penalty. How that could possibly be constitutional I have no idea.

In addition to the outrageous invasion of our homes represented by this bill, the mandates set forth are sure to drive up the costs of new homes in ways that will probably make them unaffordable for a great many people. For example, I would guess that if homes are to be 30% more efficient in just a few years, then they will likely be roughly 30% more expensive. It may be less, it may be more, but either way those prices are going up. That’s not exactly the best prescription for an ailing home market.

The bottom line of all this is that you had better be sure to tidy up your home because the federal government is coming to stay awhile and it’s bringing an awful lot of demands with it. It’s going to make having your mother-in-law over for a spell seem like a Bahamian resort vacation.

Is Cap-and-Trade a Job Killer?

Of course it is.  If it wasn’t, why would a provision such as this be in the bill?

According to Friday’s Washington Times, the legislation includes language that provides, should it become law, that people who lose their jobs because of it “could get a weekly paycheck for up to three years, subsidies to find new work and other generous benefits—courtesy of Uncle Sam.”

How generous are these benefits? Well, according to the Times, “Adversely affected employees in oil, coal and other fossil-fuel sector jobs would qualify for a weekly check worth 70 percent of their current salary for up to three years. In addition, they would get $1,500 for job-search assistance and $1,500 for moving expenses from the bill’s ‘climate change worker adjustment assistance’ program, which is expected to cost $4.2 billion from 2011 to 2019.”

Unlike thinking countries who do indeed see a future for alternative energy (but understand “future” is the key word), it appears our government is set on destroying our current “fossil-fuel sector” and hope something will be available on the scale necessary among the alternatives to pick up the slack.

The term “amazingly short-sighted” seems appropriate here, doesn’t it? After Nancy Pelosi’s “jobs, jobs, jobs and jobs” comment concerning the ostensible purpose of the bill the Democrats then build in a provision which apparently is designed to soften the blow of legislatively killing a vital industry that, at the moment, has no real replacement.

Brilliant.

~McQ

Happy “Dependence” Day

I‘m sorry, but the more I get into the monstrosities coming out of Washington DC, the less I see “independence” as a reality. Just a quick read through Waxman-Markey (and a quick read in anything but easy given the size of the bill) will tend to make you a bit pessimistic about “independence”. Consider the mundane topic of shade trees:

SEC. 205. TREE PLANTING PROGRAMS.

(a) Findings- The Congress finds that–

(1) the utility sector is the largest single source of greenhouse gas emissions in the United States today, producing approximately one-third of the country’s emissions;

(2) heating and cooling homes accounts for nearly 60 percent of residential electricity usage in the United States;

(3) shade trees planted in strategic locations can reduce residential cooling costs by as much as 30 percent;

(4) shade trees have significant clean-air benefits associated with them;

(5) every 100 healthy large trees removes about 300 pounds of air pollution (including particulate matter and ozone) and about 15 tons of carbon dioxide from the air each year;

(6) tree cover on private property and on newly-developed land has declined since the 1970s, even while emissions from transportation and industry have been rising; and

(7) in over a dozen test cities across the United States, increasing urban tree cover has generated between two and five dollars in savings for every dollar invested in such tree planting.

So now the federal government will issue guidelines and hire experts to ensure you plant shade trees properly:

(4) The term ‘tree-siting guidelines’ means a comprehensive list of science-based measurements outlining the species and minimum distance required between trees planted pursuant to this section, in addition to the minimum required distance to be maintained between such trees and–

(A) building foundations;

(B) air conditioning units;

(C) driveways and walkways;

(D) property fences;

(E) preexisting utility infrastructure;

(F) septic systems;

(G) swimming pools; and

(H) other infrastructure as deemed appropriate

And Waxman-Markey is indeed a “green-job creator” of a bill – it creates an entirely new job category – Federal House Inspector. Yes, that’s right, in order to sell your house in the future you must passed a federal housing inspection which will certify your home has the minimal energy rating necessary. And if not, you’ll be required to bring it up to par by replacing appliances (water heaters, air conditioning, etc) or repairing (leaky windows, etc) whatever the inspector finds before you can put it on the market.

Have a candelabra in your dining room? Don’t you dare put any more than a 60 watt bulb in there.  You need to also bone up on what you’ll be allowed to do with outdoor lighting, water dispensers, hot tubs and other appliances, not to mention wood burning stoves and water usage.

Yup, if this piece of legislation makes it through the Senate, we need to seriously rethink the name we give the 4th of July. “Independence” will no longer apply. And, given the level of intrusion this bill brings to our lives, you can just imagine what’s in store for us in any health care legislation passed by this administration.

Happy Dependence Day, folks.

~McQ

CBO, Entitlments, Health Care Reform and the Deficit

One more time into the breach. The CBO has issued a warning to Congress about entitlement spending. Again. Here’s a key paragraph:

Almost all of the projected growth in federal spending other than interest payments on the debt comes from growth in spending on the three largest entitlement programs–Medicare, Medicaid, and Social Security.

Most of you know that Medicare and Medicaid have an unfunded future liability of 36 trillion dollars. That’s about 3 times the annual total GDP of the US economy. And they are the very same type of “public option” program – i.e. government insurance – that the left says is so very necessary and crucial to real “health care reform”.

In other words, the left’s argument is that adding at least 47 million (presently uninsured), plus the possibility of adding 119 million who are shifted to the public option from private insurance (private insurance, btw, doesn’t have any effect on the deficit whatsoever since we, the private sector, are paying for it) will somehow make the deficit picture better?

I’m obviously missing something here.

With the public option, we’re adding a new entitlement (47 million who presently supposedly can’t afford insurance, meaning taxpayers will subsidize theirs). Assuming it is set up originally to be paid for by premiums, at some point, like Medicare and Medicaid, and every other government entitlement program I can think of, it will pay out more than it takes in. How can it not? It is a stated “non-profit” program and it will include subsidies. At some point, another revenue stream is going to be necessary as it burns through the premiums with its payouts.

Well, say the proponents of government involvement in your health care, we’re going to save money by doing preventive health care. Yes, preventive care is the key to lower costs because a healthier population is one which visits the doctor less. While that may seem to be at least partially true (you’d think a healthier population would, logically, visit the doctor less) the part that is apparently missed when touting this popular panacea is the cost of making the population healthier (and the fact that the assumption of less visits isn’t necessarily true) doesn’t cost less – it costs more:

If health care providers can prevent or delay conditions like heart disease and diabetes, the logic goes, the nation won’t have to pay for so many expensive hospital procedures.

The problem, as lawmakers are discovering to their frustration, is that the logic is wrong. Preventive care — at least the sort delivered by doctors — doesn’t save money, experts say. It costs money.

That’s old news to the analysts at the Congressional Budget Office, who have told senators on the Health, Education, Labor and Pensions Committee that it cannot score most preventive-care proposals as saving money.

So with that myth blown to hell, we’re now looking at a government plan which will add cost to the deficit by subsidizing the insurance of 47 million and (most likely) many more, plus a plan to use a more costly form of medicine as its primary means of giving care.

But, back to the entitlement report – or warning. The CBO says that unless entitlements are drastically reformed (that means Medicare, Medicaid and to a lesser extent, Social Security) we’re in deep deficit doodoo:

The most frightening findings in this report are the deficit and debt projections. In this year and next year, the yearly budget shortfall, or deficit, will be the largest post-war deficits on record–exceeding 11 percent of the economy or gross domestic product (GDP)–and by 2080 it will reach 17.8 percent of GDP.

The national debt, which is the sum of all past deficits, will escalate even faster. Since 1962, debt has averaged 36 percent of GDP, but it will reach 60 percent, nearly double the average, by next year and will exceed 100 percent of the economy by 2042. Put another way, in about 30 years, for every $1 each American citizen and business earns or produces, the government will be an equivalent $1 in debt. By 2083, debt figures will surpass an astounding 306 percent of GDP.

The report also finds high overall growth in the government as a share of the economy and of taxpayers’ wallets that provides an additional area of concern. While total government spending has hovered around 20 percent of the economy since the 1960s, it has jumped by a quarter to 25 percent in 2009 alone and will exceed 32 percent by 2083. Taxes, which have averaged at 18.3 percent of GDP, will reach unprecedented levels of 26 percent by 2083. Never in American history have spending and tax levels been that high.

Here’s the important point to be made – these projections do not include cap-and-trade or health care reform.

Got that? We’re looking at the “highest spending and tax levels” in our history without either of those huge tax and spend programs now being considered included in the numbers above. Total government spending, as a percent of GDP is now at an unprecedented 25%. And they’re trying to add more while this president, who is right in the middle of it, tells us we can’t keep this deficit spending up forever.

Fair warning.

~McQ

Quote Of The Day

From a commenter on Arnold Kling’s Atlantic site, one of the more succinct summaries of what Waxman-Markey really is:

‘Cap and Tax’ simply provides more opportunities for political favoritism — creating arbitrary credits to be awarded to pet projects while getting others to pay for the favors. Meanwhile the energy expense baseline of the entire economy goes up. Waxman-Markey are gushing about how historic this bill is. That it is — it puts Smoot-Hawley in second place as potentially the most misguided economic legislation of the last 100 years.

Take the time to read Kling’s post as well.

If you’re wondering who will be paying “for the favors”, Conor Clarke at the Atlantic has been kind enough to put that in chart form using the CBO’s data on tax distribution:

cap and trade share by income

But remember you 95% out there – your taxes won’t go up by a single dime – not one dime. Your fuel, electric, transportation, food and just about anything else you can imagine? Dimes won’t even begin to describe the increases you’ll see.

~McQ

Waxman-Markey (Cap And Trade) Passes The House

The vote was 219 to 212.

4 votes on the other side and it goes down to defeat.

So, who are these people:

Mary Bono Mack (Calif.), Mike Castle, Mark Steven Kirk (Ill.), Leonard Lance (NJ), Frank LoBiondo (NJ), John McHugh (NY), Dave Reichert (Washington), Chris Smith (NJ)

They’re the Republicans who voted for the bill and assured its passage.

You may want to find some way to thank them for passing one of the largest and most regressive tax increases in US history.

~McQ

Will Waxman-Markey Inspire A Trade War?

Apparently it will according to some who have actually beaten their way through the entire bill and read the contents:

The Ways and Means Committee’s proposed bill language (pdf) would virtually require that the president impose an import tariff on any country that fails to clamp down on greenhouse gas emissions.

Of course in this full bore onslaught of major life changing legislation which the Democrats seem determined to push through the Congress as quickly as they can (citing the imminent crisis it will foment if they don’t), this issue seems to be lost in the shuffle:

“This is a sleeper issue that lawmakers have not been paying enough attention to,” said Jake Colvin, vice president for global trade issues at the National Foreign Trade Council, which represents multinational corporations like Boeing Co. and Microsoft Corp. advocating for an open international trading system.

“The danger is, you focus so much on leveling the playing field for U.S. firms, that you neglect the potentially serious consequences that this could have on the international trading system,” Colvin said.

Ya think?

Nancy Peolosi is aiming for a vote in the House this Friday, before the July 4th recess. That obviously will mean very, very limited debate, if any. As NRO notes:

Not content to tempt political fate by imposing huge carbon taxes on the American middle class, Democrats have added a provision which imposes stiff tariffs on our trading partners if they don’t adopt aggressive carbon restrictions of their own.

You heard correctly: progressives have authored a bill that earns the mortal enmity of domestic energy consumers and our most crucial trading partners at the same time. Economy-killing climate policies and a trade war — together at last!

The devil is in the details:

Leaks from Hill offices indicate that the president would now be forced to impose the carbon tariffs — and could only opt out of doing so with permission from both chambers of Congress. Carbon-intensive imports would be subject to penalties at the border unless the country of origin requires emission reduction measures at least 80 percent as costly as ours. (The original Waxman-Markey bill had a threshold of 60 percent.)

Brilliant. Of course, some are going to argue that such measures surely will not be in the Senate version and not survive the reconciliation process when the two versions are merged. With this Congress I wouldn’t bet the farm on that.

There’s some talk that the blue dogs are going to oppose this bill. Obviously you would expect the GOP to oppose it as well. Are there enough other Dems to oppose so as to defeat it? Pelosi may not be the sharpest knife in the drawer when it comes to many things, but over the years she has learned to count votes I’m sure.

Bottom line: this bill is an economy killer, plain and simple. But it is also a progressive wet-dream shared by Pelosi. She is going to do everything in her power to push it through the House.

~McQ

Cap and Trade – The Plan to Raise Gasoline Prices

And apparently force you into those electric cars the government is dumping all that money into.

According to API president Jack Gerard, in a letter he sent to members of Congress, the plan included in Waxman-Markey is pretty darn clear:

The legislation will drive up individual and commercial consumer’s fuel prices because it inequitably distributes free emissions “allowances” to various sectors.  Electricity suppliers are responsible for about 40% of the emissions covered by the bill and receive approximately 44% of the allowances – specifically to protect power consumers from price increases.  However the bill holds refiners responsible for their own emissions plus the emissions from the use of petroleum products.  In total refiners are responsible for 44% of all covered emissions, yet the legislation grants them only 2% of the free allowances.

Upon reading that I assume anyone with the IQ of warm toast can see where that is headed. It is a targeted tax on oil and gas which will be passed on to the consumer in just about every conceivable way possible. Both at the pump and in the cost increases rolled into products we buy due to increased transportation costs, etc.

Electricity, however, whose coal plants are supposedly one of the primary producers of CO2 and very much responsible for the emissions problems we supposedly have get a pass. Does that even begin to hint that this legislation isn’t just about controlling CO2 emissions?

In fact, it shouts it out fairly clearly doesn’t it. Keep the proles happy by ensuring their power to the house is subsidized and stick it to them at the pump where government (who now has a stake in the game) wants consumers buying “green” cars. Don’t you just love it when a plan begins to come together?

Moving on, Gerard’s letter lays out some sobering numbers:

This places a disproportionate burden on all consumers of gasoline, diesel fuel, heating oil, jet fuel, propane and other petroleum products. An analysis of the Congressional Budget Office Report indicates that it could add as much as 77 cents to a gallon of gasoline over the next decade. And, according to the Heritage Foundation this legislation could cause gas prices to jump 74% by 2035. That means, at today’s prices, gasoline would be well over $4 a gallon.

Of course by 2035 we’ll all be riding around in vehicles powered by uincorn methane. And everyone knows that unicorn methane is nontoxic, environmentally friendly, smells good and is eco friendly.

That said, there is the cap and trade plan as it pertains to one vital segment of our economy in all its simple glory. It will force you to pay outrageous prices to use petroleum products in order to move you to the desired, but not yet available, means of conveyance. In the meantime, and until it is available, you’ll just have to suffer with the cost increases.  Also remember that government estimates of cost are notoriously conservative and the real cost of such legislation is likely to be much higher than anticipated.

And don’t laugh too hard when they try to sell that to you by saying they’re attempting to save the planet. They’re exempting coal fired power plants for heaven sake. Trust me, this isn’t about emissions. If it were, they wouldn’t treat natural gas the way they do in the legislation as the letter points out.

After all, they’re the government and they’re there to help.

~McQ