The Congressional Budget Office said Wednesday that the cap-and-trade climate change bill sponsored by Sens. John Kerry, D-Mass., and Barbara Boxer, D-Calif., would generate a $21 billion surplus over the period of 2010-19. The nonpartisan CBO also said that after 2019, the bill, S 1733, would continue to generate more money than it would spend.
Here is the Congressional Budget Office’s full analysis:
On June 19th, the Congressional Budget Office analyzed the ACES Act — legislation crafted by Congress, not by “czars” in the White House — and determined “that the net annual economywide cost of the cap-and-trade program in 2020 would be $22 billion—or about $175 per household.” Yesterday, the CBO — a Congressional research arm independent of the “spooky” executive branch — released an updated analysis that lowered its previous cost projection to “$160 per household.” In other words:
The average household would spend 44 cents per day – less than a postage stamp.
The revised analysis also determined that the least well off Americans would receive a greater net benefit than its previous projections. “CBO estimates that households in the lowest income quintile in 2020 would see an average gain… [of] about $125” per household. By 2050, this net gain would increase to “$355 measured at 2010 income levels.”
According to Declan McCullagh, a libertarian blogger who works for CBS Interactive, secret Obama administration documents reveal that the cost of clean energy cap-and-trade legislation would be $1,761 per household — despite official estimates from the Environmental Protection Agency, the Congressional Budget Office, and the Energy Information Administration of about a postage stamp a day. Based on Treasury Department documents acquired by the Competitive Enterprise Institute (CEI), McCullagh claims that “a cap and trade law would cost American taxpayers up to $200 billion a year, the equivalent of hiking personal income taxes by about 15 percent“.
There are lots of other updates on this story in the Wonk Room piece. Please read the whole thing.
The CBS piece, which can be found here, was later updated with this statement from the Environmental Defense Fund:
Even if a 100 percent auction was a live legislative proposal, which it’s not, that math ignores the redistribution of revenue back to consumers. It only looks at one side of the balance sheet. It would only be true if you think the Administration was going to pile all the cash on the White House lawn and set it on fire.
The bill passed by the House sends the value of pollution permits to consumers, and it contains robust cost-containment provisions. Every credible and independent economic analysis of the American Clean Energy and Security Act (such as those done by the non-partisan Congressional Budget Office, the Energy Information Administration, and the Environmental Protection Agency) says the costs will be small and affordable — and that the U.S. economy will grow with a cap on carbon.
Clean Energy Works responded to the highly flawed CBS piece with this document:
Politico’s Ben Smith was also forced to correct his misleading piece on this:
CORRECTION: The League of Conservation Voters’ Navin Nayak points out to me that the documents are a bit less than meets the eye: They refer to a version of the legislation profoundly different than the one that passed. Specifically, the original White House plan had 100% of emissions permits being distributed by auction; the plan that passed has just 15%. “Can you say ‘irrelevant analysis’? It would be like pricing the health care bills currently in front of Congress based on a single-payer system,” he writes.
Assistant Treasury Secretary Alan Krueger has now weighed in:
“The reporting on the Treasury analysis is flat out wrong. Treasury’s analysis is consistent with public analyses by the EIA, EPA, and CBO, and the reporting and blogging on this issue ignores the fact that the revenue raised from emission permits would be returned to consumers under both administration and legislative proposals. It is time for an honest debate about how to solve a long-term challenge and deliver comprehensive energy reform – not for misrepresentations of the facts.”
More excellent pushback on this from Media Matters, Bill Scher at Blog for Our Future and Pete Altman at NRDC.
Finally, here is the out-of-date FOIA document the original flawed reporting from CBS and Politico was based on:
FOIA-Cap-andTrade-2009-09-11 –
Update: Kate Sheppard at The Washington Independent catches Senator Lamar Alexander (R-TN) repeating this lie to the Washington Post.
So much of the wailing and gnashing of teeth around the climate bill in Congress revolves around the costs of curbing greenhouse-gas emissions. What about the benefits?
That is, seemingly everybody—the Environmental Protection Agency, the Congressional Budget Office, the Energy Information Administration, not to mention private-sector lobbies—has tried to tally how much it will cost to nudge America toward cleaner energy and fewer greenhouse-gas emissions. None have sought to figure out what kind of benefits the bill could bring.
That got some folks thinking. “Climate change is arguably one of the most complex issues to face Congress in recent memory, and yet Congress is essentially conducting its deliberations after having reviewed barely half the data,” says a new brief out from NYU Law School’s Institute for Policy Integrity, an outfit basically created to bring cost-benefit analysis back to the environmental arena.
The upshot? As flawed as it may be, the Waxman-Markey climate bill makes economic sense, offering benefits worth at least twice as much as it costs, if not more.
Other Side of the Coin: The Economic Benefits of Climate Legislation –
