Tuesday, March 3, 2009

Stealth Tax

This article puts the Cap n Trade scheme by Congress in simple to understand terms. The key take away points are:
  • It IS A TAX
  • The cost will be passed on to the consumer
  • STEALTH - Congress's way of passing a tax without the unwashed (that's you & me) noticing . Taxes are unpopular you know
  • Industries like Duke energy have bought in because there are incentives for them baked into the plan. Also, they can pass on the cost with the blessing of congress
  • The $540 B of expected tax revenue will be managed (I'm sure very efficiently) from Washington with the likes of Pelosi and Reid deciding where it gets spent outside the appropriations process.
  • ENRON style brokers are greedily licking their chops at the prospects of dealing the buys/sells of the emission credits. (their commissions and bonuses also paid by you). Is their anything that can't be reduced to a commodity for these people. They will start out as relatively easy to identify credits to emit then they will be bundled for resale on a secondary market to spread the risk, then they will...HOLY COW!!
  • Others lurking behind the scenes stand to make big profits selling offsets, e.g. I build a factory in Arizona and install solar panels so I can sell my credits to you in sunless Anchorage so you can use coal. Oh, by the way I would have used solar in Arizona anyway because it pays there. I'm no fool, someone will pay me money to do something I was already going to do!! Nice!! If I don't use my land to raise cattle can I get some $ for the methane I would emit?
  • Offsets are an illusion created to offset the guilt of Al Gore and Leonardo DiCaprio for their multiple mansions and private jets.
  • Economist point out that a direct tax is much more efficient because it does not require all the overhead to manage and manipulate. Congress won't do the efficient thing because it is too obvious even to the American Idol audience that it is a tax.

Much more, read the whole thing.

Please don't take this lying down. Let your representatives know you are aware of what this is - A TAX.

Oh, I almost forgot. Lost in all this rhetoric is the simple fact that -
  • The Globe is not warming - Read this, from George Will in the WAPO
  • Even if it warming it not significantly affected by our carbon emissions
  • US Cap & Trade will not reduce emissions worldwide because China, India, Russia, Japan, et al have all said they will not participate.
  • Kyoto and the EU's effort at Cap n Trade was an abject failure. I achieved no reduction in emissions at an enormous cost.