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Factsheet #28 on Climate Change

May 20, 2009

Waxman-Markey Global Warming Tax Kills More Jobs and Kills the Economy

Familes, make room

Cap and Tax Top Ten List

1. Cap and Trade Is a Massive Energy Tax

2. It Will Not Make a Substantive Impact on the Environment

3. It Will Kill Jobs

4. It Will Cause Electricity Bills and Gas Prices to Sharply Increase

5. It Will Outsource Manufacturing Jobs and Hurt Free Trade

6. It Will Make You Choose Between Energy, Groceries, Clothing, and Haircuts

7. It Will Be Highly Susceptible to Fraud and Corruption

8. It Will Hurt Senior Citizens, the Poor, and the Unemployed the Worst

9. It Will Cost American Families Over $3,000 a Year

10. President Obama Admitted "Electricity Rates Would Necessarily Skyrocket" Under a Cap-and-Trade Program (January 2008)

Waxman-Markey Bill: Dumb and Dumber

  • Waxman-Markey Global Warming Tax: The cap-and-trade tax proposed by Reps. Henry Waxman (D-CA) and Edward Markey (D-MA) is disguised as environmental legislation when it would have little impact on global temperatures. In fact, it is a massive energy tax that promises soaring household energy bills, major job losses, income cuts, and a sharp left turn toward big government.
  • And It Keeps Getting Worse: The original draft of Waxman-Markey was so bad for the economy that moderate Democrats demanded it be changed. The new version, believe it or not, is much worse. Compared to no cap and trade, real GDP losses increase an additional $2 trillion, from $7.4 trillion to $9.6 trillion
  • And Why Is It Getting Worse? Attempts to reduce costs to consumers in the current bill do ease some near-term economic pains, but because "pollution permits" are handed out as subsidies, debt is driven up, interest rates increase, and businesses significantly reduce the investments that drive the overall economy, resulting in a more costly bill.
  • Green Jobs Are a Myth; Real Job Losses Are Not: For every "green job" created, others are wiped out. Compared to no cap and trade, average unemployment increases in the new bill an additional 261,000 jobs, from 844,000 lost jobs to 1,105,000 lost jobs in the current version
  • Your Family Will Pay: Waxman-Markey will raise electricity rates 90% after adjusting for inflation, gas prices 74%, natural gas prices 55%, and an average family's annual energy bill by at least $1,500.

And What Do We Get After We Tax the Weather?

  • The Ultimate Outsourcing: India and China have repeatedly said they would not match U.S. environmental goals in order to protect their economies. Cap and trade will merely move manufacturing jobs to China and India.
  • Environmental Status Quo: All of the outrageous costs associated with this bill may at best result in 0.2 degree drop in temperature by the end of the century, and most likely even less.
  • Massive Corruption: The New York Times reports that cap and trade "is almost perfectly designed for the buying and selling of political support through the granting of valuable emissions permits to favor specific industries and even specific congressional districts" (May 20, 2009).
  • An Alternative That Supports American Taxpayers: Instead of appeasing a radical environmental agenda, President Obama should give us access to all energy sources, including domestic oil production, nuclear energy, coal, and new renewable fuels. Instead of new taxes, the President should aim to lower gas and electricity prices. When government impediments are lifted, America's energy entrepreneurs can develop innovative and market-driven solutions to our energy needs.

For more information, please visit: http://blog.heritage.org/2009/05/20/the-waxman-markey-global-warming-tax/

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