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An Open Letter to the U.S. Senate: Oppose S. 2191, the Lieberman-Warner "Climate Security Act"!
May 28, 2008
On behalf of the 362,000 members of the National Taxpayers Union (NTU), I urge you to oppose S. 2191, the Lieberman-Warner "Climate Security Act." This bill would impose an annual cap on the emissions of six greenhouse gases, principally carbon dioxide, and would establish a trading system for emissions allowances. This "cap-and-trade" system constitutes a colossal tax hike and should be opposed due to its enormous cost and regulatory implications.
First and foremost, this bill amounts to a huge tax hike. Though the mechanism obscures the fact slightly, this bill effectively imposes a substantial carbon tax. Capping emissions and requiring entities to purchase additional allowances from the federal government will lead to an explosion in revenue. The Congressional Budget Office (CBO) estimates that the tax increase adds up to nearly $1.2 trillion over just a seven-year period from enactment in 2012 to 2018.
Enacting S. 2191 would also tremendously harm economic growth and job expansion. An analysis by the Heritage Foundation estimated that GDP losses as a result of the legislation between 2010 and 2030 would range from $1.7 trillion to $4.8 trillion. Job losses could exceed 700,000 in 2015 alone. The CBO also estimates that the cost of S. 2191's private-sector mandates would amount to more than $90 billion per year from 2012 to 2016. These costs would severely undermine America's ability to attract businesses and capital. Meanwhile, the bill would drain household budgets by increasing the cost of natural gas and electricity for American families.
In addition to the aforementioned costs, the Lieberman-Warner bill contains troubling regulatory implications. The Environmental Protection Agency would be charged with the daunting task of establishing emissions allowances for thousands of American manufacturers and electricity generators, no doubt requiring an army of bureaucrats in the process.
We at NTU are not climate scientists, nor can we profess to explain the relationship between man and climate. But if Congress, through its deliberations, deems it desirable to cap carbon dioxide emissions, it should not be used as a guise for a massive tax hike. As with any bill, any increase in revenues should be matched by corresponding reductions in tax rates elsewhere to prevent taxpayers from sacrificing more of their money to Washington, D.C.
Despite the rhetoric to the contrary, this cap-and-trade legislation is not a "market solution." No bill that contains such mammoth tax increases and regulatory burdens could fit that description. As such, we urge you to oppose S. 2191. Roll call votes on this bill will be heavily weighted in our annual Rating of Congress.