SNOWDEN – Cap and Trade: “Blueprint for Disaster”

As readers of this blog are aware, I am a member (along with many legislative colleagues in both the House and Senate) of the American Legislative Exchange Council (ALEC), whose stated mission is: “to advance the Jeffersonian principles of free markets, limited government, federalism, and individual liberty, through a nonpartisan public-private partnership of America’s state legislators, members of the private sector, the federal government, and general public.” You may read more about ALEC at www.alec.org

ALEC’s Natural Resources Task Force (on which I do not serve) has released an Alert dealing with the proposed “cap and trade” legislation. Now, I am no expert on “cap and trade,” and I do not pretend to be. I haven’t personally read or analyzed the bill. However, I find this Alert particularly interesting because it focuses on the potential cost of “cap and trade” to Mississippi, as compared to other states.

Anyway, I present the Alert verbatim as food for thought (and obviously as blog fodder). Have at it:

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The U.S. Senate is using the Waxman-Markey cap-and-trade legislation as a blueprint for crafting a bill proponents hope will be ready for vote as early as September. The Waxman-Markey legislation adopted by the House on June 26 is a blueprint for disaster. It will impose higher energy costs on American families, cut American jobs (a net loss even after government-funded “green” jobs) and slow GDP growth in the middle of a recession.

What’s worse, the bill’s economic harms are distributed unevenly among states sparing Waxman’s (and Pelosi’s) California at the expense of the Heartland and the South. For example, to meet electricity needs under the allocation scheme adopted by the House, Mississippi would be forced to choose between buying extra credits from the coastal West and Northeast or paying foreign countries for offsets.

For how much would Mississippi be on the hook? According to analysis of the bill from the U.S. Chamber of Commerce using data from the Energy Information Administration (EIA) and the Congressional Budget Office (CBO), Mississippi would have to pay an extra $75 million in 2012 alone to comply with cap-and-trade (assuming CBO estimate of $15 per ton). This new tax on Mississippi is for electricity only and does not reflect other costs imposed by the bill. States like California, Washington, New York and New Jersey would actually gain under the allocation scheme adopted by the House.

Rep. Snowden’s Blog
Clarion-Ledger
8/6/9