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$175 Per Household For A Greener Tomorrow.... Well, Sort of....

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June 27, 2009 – Comments (16)

Wish I had found this before the vote, not that it matters. Anyway, I always find it amusing when the government uses the same bogus accounting that would land a CEO in hot water.  No irony is lost on me =D.  This is going to be fun. 

Below, Robert Murphy and the rest of the gang at the Institute for Energy Research take a closer look at the CBO's cost.... ahem... estimates.  It's quite amusing.

And now we sit back and wait for the ad hominem attacks from the Obamabots, and the aimless pleas of the weary and tired government loving drones that "something had to be done" and "it's not a perfect bill but at least we got something" and all that other nonsense.  Enjoy!

David in Qatar 

Enron Accounting: CBO and EPA Cooked the Books on Cost Estimates for Waxman-Markey Energy Tax

Later this week, the U.S. House will take up the Waxman-Markey global warming bill [Update: the bill passed last night 219-214], the centerpiece of which is a cap and trade program that advocates argue will reduce U.S. greenhouse gas emissions. The bill features a remarkably aggressive timetable, one that would force businesses to cut emissions by 17% (relative to the 2005 baseline) by the year 2020, and by a cumulative 83% by 2050. On cue, “independent” agencies of the government such as CBO and EPA have announced cost estimates that grossly understate the burden Waxman-Markey will place on most U.S. households.

On June 19, the CBO announced that the cap-and trade program contained in Waxman-Markey would cost households an average of $175 in the year 2020 (measured in today’s dollars). On June 23, in an effort to reassert its green bona fides, the EPA came out with an even lower estimate of $80-$111 per household. But even a cursory examination of the methodologies involved in manufacturing those numbers reveals that even the higher CBO figure is far too optimistic, since it leads citizens to believe that energy prices will only go up modestly because of the new cap and trade program.

In fact, very little related to the consequences of Waxman-Markey can be characterized as “modest.” Households will pay far more than $175 per year due to cap and trade, notwithstanding CBO’s attempts to hide it. The EPA study is misleading in the same fashion, but here we focus on the CBO report which can be read by the layperson and states quite clearly how it comes up with its low cost estimate.

Rags to Riches: How the CBO Transforms a Stealth Tax Into a Phantom Tax Cut

There are several major flaws with the CBO approach, but perhaps the most outrageous example of sleight of hand is the CBO’s focus on after-tax income. Because Waxman-Markey will raise prices more than incomes, households will necessarily become poorer. This will push households into lower tax brackets—and thus have lower tax liabilities to the tune of roughly $8.7 billion. Normal people would consider this to be a downside of Waxman-Markey. CBO is not normal. It considers this $8.7 billion as an addition to total household income—money from heaven!—and goes about celebrating the effect of this policy without saying a thing about the cause.

After explaining that some government benefits are indexed to the Consumer Price Index, which means that federal spending will have to increase owing to Waxman-Markey’s energy price hikes, the CBO study points out the silver lining:

"Because the federal income tax system is largely indexed to the consumer price index, an increase in consumer prices with no increase in nominal incomes would also reduce federal income taxes. That effect would increase households’ after-tax income but would also add to the federal deficit. In combination, the effect of price changes on the government’s indexed benefit payments and income tax receipts would convey an estimated $8.7 billion to households." (p.7)

Beyond the absurdity of translating rising prices into a benefit for households—on the basis that poorer people pay less in taxes—the CBO’s treatment of income tax revenues is inconsistent with its treatment of carbon allowance auction receipts. The CBO study acknowledges that households will pay higher energy prices partly because businesses will “pass on” the cost of buying emission allowances. But CBO didn’t include this component as a net cost to households, because the government could spend the auction receipts and thus recycle some of the money back into households.

But if that’s how the CBO wants to do its accounting, then it can’t credit households with a fictitious $8.7 billion “tax cut.” As the quotation above points out, the falling income tax revenues will simply mean a larger budget deficit if the government doesn’t cut other spending. This extra borrowing by the federal government will push up interest rates and transfer $8.7 billion out of the private capital markets. Households will ultimately lose wealth (in the form of greater public debt) that exactly offsets their alleged gain from falling into lower tax brackets.

Impacts on the “Average” Household

The CBO study admits on page 1 that the greenhouse gas (GHG) emission schedule would raise prices for Americans:

This analysis examines the average cost per household that would result from implementing the GHG cap-and-trade program under H.R. 2454….Reducing emissions to the level required by the cap would be accomplished mainly by stemming demand for carbon-based energy by increasing its price…. Those higher prices, in turn, would reduce households’ purchasing power. (p.1)

However, the CBO’s reported annual cost estimate of $175 per household in the year 2020, does not refer to the tallying up of the price hikes acknowledged in the quotation above. The CBO reduces the “gross cost” by mixing in all of the financial benefits that will accrue to “households” from the cap and trade program:

At the same time, the distribution of emission allowances would improve households’ financial situation. The net financial impact of the program on households…would depend in large part on how many allowances were sold (versus given away), how the free allowances were allocated, and how any proceeds from selling allowances were used. That net impact would reflect both the added costs that households experienced because of higher prices and the share of the allowance value that they received in the form of benefit payments, rebates, tax decreases or credits, wages, and returns on their investments. (pp. 1-2)

The problem should be obvious: If the government spends auction revenues, or hands out “free” allowances that possess high market value, to fund alternative energy boondoggles, the CBO study will carefully chalk that money up as flowing back into the pockets of U.S. “households.”

The CBO’s logic makes sense from a certain point of view: A firm that makes solar panels is owned by shareholders who live in houses, right? So when that solar panel firm sees huge profits in the new scheme, the wealth showered on its owners will accrue to households. Even though all electricity consumers will be paying higher prices, the “average” hit will be mitigated to the extent that some of those consumers happen to be on the receiving end of the cap and trade gravy train.
The CBO’s reasoning may be appropriate in some applications, but it is grossly misleading in the current political context. Citizens may come away from the report believing that their annual expenses will rise only $175 because of Waxman-Markey. The real figure is much higher.

The CBO's Gross Cost

In contrast to the net cost of “$22 billion—or about $175 per household” (p.2), what does the CBO say about the gross cost, meaning the actual reduction in household purchasing power? In other words, how much of a hit will households take in the form of higher prices and lower wages, before the CBO adds back in all the pork spending and other goodies? They tell us on page 4:

"According to CBO’s estimates, the gross cost of complying with the GHG cap-and-trade program delineated in H.R. 2454 would be about $110 billion in 2020…or about $890 per household." (p. 4)

We see that the number reported in the press—“$175 per household by 2020”—represents only 20 percent of the CBO’s projected increase in household costs. The other 80 percent of the gross price hikes is transferred away from unlucky consumers and into the pockets of politically-connected beneficiaries. Since this wealth is redistributed, it’s still in “households” (somewhere) and so the CBO doesn’t report the gross figure, which is five times higher than the number bouncing around the press. But that’s not the end of it. CBO didn’t score anything but the “cap and trade” part of the bill…not the renewable energy mandate, not the additional costs of complying with the bureaucratic nirvana of new standards for energy efficiency of lighting for home art and “personal spas,” etc. In some parts of the country, the “You Must Obey” renewable energy mandate could force significantly higher costs on consumers and businesses.

Winners and Losers

The CBO study acknowledges that its estimates are average figures, and that the impacts on particular sectors will be uneven:

"The measure of costs described above reflects the costs that would occur once the economy had adjusted to the change in the relative prices of goods and services. It does not include the costs that some current investors and workers in sectors of the economy that produce energy and energy-intensive goods and services would incur as the economy moved away from the use of fossil fuels….Stock losses would tend to be widely dispersed among investors because shareholders typically diversify their portfolios. In contrast, the costs of unemployment would probably be concentrated among relatively few households and, by extension, their communities." (p.8)

In addition to the negative impact on workers in energy-intensive sectors, the Waxman-Markey bill would also hurt energy consumers to different degrees, depending on which region of the country they lived in. The Southern and Midwestern states are much more reliant on coal and other fossil fuels for their electricity production. Consumers in these regions will see their electricity rates jump higher than in other areas of the country.

Conclusion

Make no mistake: Waxman-Markey is a tax that, to work properly, must find a way to drive up energy prices. CBO bends over backwards to try to disguise this fact, but even they admit Waxman-Markey will increase energy prices.

The CBO’s gross cost estimate of $890 per household is also optimistic. Other studies put the figure at $1,500 per family in higher energy costs. That makes the much lower figure of $175 per household extremely misleading.

Bent on disguising the true costs of Waxman-Markey, CBO performed a deeply flawed analysis. They treat lower household income as a good thing because households will be subject to lower tax rates, even though this will increase the budget deficit and help drive up interest rates making economic growth more difficult.

The CBO is also disingenuous in its treatment of free allowances. The financial benefit of the free allowances will go to a small subset of the population (and to overseas investors), but CBO merely averages the benefits across the U.S. population. This is deeply disingenuous and misleading.

Households are in for much bigger price hikes than the CBO would lead them to believe.

Despite CBO’s heroic attempts to put a nice gloss on Waxman-Markey, cap and trade is what Rep. Dingell said it was—a tax, and a great big one.

16 Comments – Post Your Own

#1) On June 27, 2009 at 9:24 AM, lighthouse99 (< 20) wrote:

David, there is another way of thinking about the costs...

Little criticism seems to be made of all the energy efficiency regulation in this and other proposals:

Ban consumers from buying what they want and applaud the savings! (little savings in banning impopular products, and inefficient products need to be popular or noone would buy them, classic example Edison’s light bulb, bought 19 times out of 20 in the USA - and therefore a banning priority in Waxman-Markey!)

The fact is that efficiency regulation on a product sacrifices performance, construction, appearance and price features, and does not necessarily give the savings suggested anyway.

See
http://ceolas.net/#cc2x
onwards regarding efficiency regulation effect on buildings, lightbulbs, cars, dishwashers and other products.

As for Cap and Trade…..

As you say, Cap and Trade is an expensive roundabout way of achieving…not very much.

Whatever one’s attitude to greenhouse gas emissions, they can be lowered just by changes in electricity and transport (together responsible for 4/5 of emissions!).

Electricity and transport changes have their own advantages - regardless of also lowering CO2:

1. Local environmental benefit from less pollution of sulphur and all else that's in the emissions, regardless of the less certain or immediate global benefit from CO2 reduction - and that is one reason why the focus on carbon trading is wrong, compared with the focus on reducing fuel combustion emissions.
2. Electricity supply alternatives which together with improved grid distribution gives better conmpetition and keeps down electricity bills for consumers.
3. Transport alternatives (using electricity, hydrogen and other energy sources), which also reduces the dependency on oil imports.

In 2020, from then available evidence, either
1. There is increasing consensus that global warming can’t be stopped anyway, and that further specific reduction attempts have no value: In that case little has been lost, since the described changes in electricity and transport industry carry their own benefit, or
2. Consensus remains that CO2 emission reduction should continue, in which case America is on track, and may continue with more specific emission reduction efforts for the years 2030 aqnd 2050 that also bring in agriculture, cement, steel and other industry whose businesses hitherto did not need disruption.

Cost to businesses - and the consumers - is kept to a minimum
by equity and long term loan finance, the latter can be fed/state guaranteed to keep down interest rates, with slow payback anyway giving little affected consumer electricity bills or car costs.
No disruption of American business practice and planning, by emission trading.
No volatile extra emission trading costs for a range of businesses, passed on to consumers.

Understanding Cap and Trade + why it is bad for America, see
http://ceolas.net/#cce5x

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#2) On June 27, 2009 at 11:48 AM, Option1307 (30.06) wrote:

Make no mistake: Waxman-Markey is a tax that, to work properly, must find a way to drive up energy prices.

This is what seems absolutely ridiculous to me. In order for this plan to "work", taxes must be raised. That is the basic premise of this bill. Increase the price of energy so people use less of it. Yet, opponents of this bill claim that it is not going to raise taxes that much, possible $175 a year.

Umm, what?

You cannot have both of these objectives simultaneously, it is simply impossibly. Theya re lying about one of the statements, period. (Either that , or they are incredibly dumb which is also very likely.) This is why I find the basic logic of this billed flawed. You can't have your cake and eat it too...

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#3) On June 27, 2009 at 1:53 PM, starbucks4ever (94.57) wrote:

To be fair, you should consider that the "cheap" energy we enjoy today has a hidden cost of many billions spent on the Operation Iraki Oil. We don't see this cost at the pump, but we see it when they send us a tax bill and we wonder what the f..c they do with this money. The answer is they spend much of it it on weapons to fight for cheap oil. 

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#4) On June 27, 2009 at 1:55 PM, whereaminow (< 20) wrote:

This.....is.... awesome......

David in Qatar

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#5) On June 27, 2009 at 1:57 PM, whereaminow (< 20) wrote:

And Part Two :)

David in Qatar

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#6) On June 27, 2009 at 2:02 PM, whereaminow (< 20) wrote:

zloj,

We are always agreed on foreign policy, but that energy doesn't come cheap. The hidden costs to Americans come in other forms:

1. Money diverted from the people, who could have put it to productive use, into the hands of foreign dictators, contractors, the military.

2. Money spent to repair what we destroy and replace what is broken.

3. The lost lives of productive men and women.

4. The lost years of productive men and women living overseas.

David in Qatar

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#7) On June 27, 2009 at 3:07 PM, lucas1985 (< 20) wrote:

"The Institute for Energy Research (IER), founded in 1989 from a predecessor non-profit organisation, advocates positions on environmental issues which happen to suit the energy industry: climate change denial, claims that conventional energy sources are virtually limitless, and the deregulation of utilities.

It is a member of the Sustainable Development Network. The IER's President was formerly Director of Public Relations Policy at Enron.
IER has been established as a 501(c)(3) non-profit group. It is a "partner" organization of the American Energy Alliance, a 501c4 organization which states that it is the "grassroots arm" of IER. AEA states that, by "communicating IER’s decades of scholarly research to the grassroots, AEA will empower citizens with facts so that people who believe in freedom can reclaim the moral high ground in the national public policy debates in the energy and environmental arena." AEA states that its aim is to "create a climate that encourages the advancement of free market energy policies" and in particular ensure drilling for oil is allowed in the Arctic National Wildlife refuse and in US coastal waters."

http://www.sourcewatch.org/index.php?title=Institute_for_Energy_Research

In other words, this is pure spin from whereaminow who feels entitled to post fact-free and context-free factoids on his blog.

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#8) On June 27, 2009 at 8:13 PM, whereaminow (< 20) wrote:

And now we sit back and wait for the ad hominem attacks

Ladies and gentkemen, lucas1985!

They're so predicatble, aren't they?

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#9) On June 28, 2009 at 7:30 PM, lucas1985 (< 20) wrote:

And now we sit back and wait for the ad hominem attacks

Let me educate you:
"ad hominem is one of the most frequently misidentified fallacies, probably because it is one of the best known ones. Many people seem to think that any personal criticism, attack, or insult counts as an ad hominem fallacy. Moreover, in some contexts the phrase "ad hominem" may refer to an ethical lapse, rather than a logical mistake, as it may be a violation of debate etiquette to engage in personalities. So, in addition to ignorance, there is also the possibility of equivocation on the meaning of "ad hominem"." (1)
"criticisms directed at testimony, which are not fallacious, since pointing out that someone stands to gain from testifying a certain way would tend to cast doubt upon that testimony. For instance, when a celebrity endorses a product, it is usually in return for money, which lowers the evidentiary value of such an endorsement—often to nothing!" (1)

"The mere presence of a personal attack does not indicate ad hominem: the attack must be used for the purpose of undermining the argument, or otherwise the logical fallacy isn't there. It is not a logical fallacy to attack someone; the fallacy comes from assuming that a personal attack is also necessarily an attack on that person's arguments.
Therefore, if you can't demonstrate that your opponent is trying to counter your argument by attacking you, you can't demonstrate that he is resorting to ad hominem. If your opponent's sarcasm is not an attempt to counter your argument, but merely an attempt to insult you (or amuse the bystanders), then it is not part of an ad hominem argument.
Actual instances of argumentum ad hominem are relatively rare. Ironically, the fallacy is most often committed by those who accuse their opponents of ad hominem, since they try to dismiss the opposition not by engaging with their arguments, but by claiming that they resort to personal attacks. Those who are quick to squeal "ad hominem" are often guilty of several other logical fallacies, including one of the worst of all: the fallacious belief that introducing an impressive-sounding Latin term somehow gives one the decisive edge in an argument."
(2)

"No one sensible takes this idea seriously when, for example, money is at stake. A member of a board of directors who has a financial interest in a proposal is expected to declare it and withdraw from the discussion for example. By contrast, believers in the “ad hominem fallacy” fallacy would suggest that the director’s arguments were just as valid as anyone else’s, and they do not need to declare their interest before taking part in the discussion (though they should not vote).
The problems with conflict of interest are twofold. First, it is usually impossible to check every factual claim made by someone putting an argument. Second, even if all the facts asserted in support of some position are verifiable, they may have been selected (cherry-picked) to favour a case, while facts pointing the other way have been ignored. If you’re willing to go to the trouble of fully informing yourself about the topic using independent sources evidence from interested sources is redundant, and if not, it’s unreliable"
(3)
"A question that’s often raised in relation to public policy issues involving science is whether conflicts of interest matter. For example, does it matter if scientists who publish reports suggesting that the dangers of smoking are overstated turn out to be funded by tobacco companies? Common sense suggests that it matters, but a lot of commentators, often with a vague recollection of classes in elementary logic, suggest that this is an ad hominem criticism and that the only thing that is relevant is the argument, not who makes it." (3)
"We not only have to trust scientists to give us the best advice, but we also have to trust them to tell us who the relevant scientists are. The big argument for accepting this is the undeniable success of the scientific enterprise as a whole, and its demonstrated capacity for correcting error. This can be contrasted with the demonstrated capacity of interest groups to maintain propositions that suit their interests in the face of strong, indeed overwhelming, evidence to the contrary." (3)

So, I disclose IER's huge conflicts of interests and then make the point that your argumentative skills often involve using shoddy sources of fact and/or the use of context-free factoids and your answer is screaming that I've committed a logical fallacy? I expected something better, knowing that right-libertarians usually comprise the somewhat (just somewhat) educated faction of Conservatism.
This analysis of the costs of Waxman-Markey is pure BS and it's been throughly debunked (4, 5)


1- http://www.fallacyfiles.org/adhomine.html
2- http://plover.net/~bonds/adhominem.html
3- http://johnquiggin.com/index.php/archives/2006/02/21/ad-hominem-ad-nauseam/
4- http://climateprogress.org/2009/04/30/american-energy-alliance-aea-institute-for-energy-research-ier/
5- http://mediamattersaction.org/factcheck/200906050003

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#10) On June 29, 2009 at 6:09 AM, whereaminow (< 20) wrote:

Lucas, you are so cute. You're like my personal very own troll.

Can you dispute any of the material presented in the IER article?  No? I didn't think so.

David in Qatar

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#11) On June 29, 2009 at 6:43 AM, whereaminow (< 20) wrote:

Lucas,

Did you read articles #4 & 5?  Neither of them addressed anything presented in the IER artcile.  They were attacks on IER, not on the material presented.

What is that called?

Can you dispute any of the material presented in the IER article?

David in Qatar

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#12) On June 29, 2009 at 8:15 AM, wrparks (68.79) wrote:

I like this argument.  One guy claims another guys sources are biased by citing sources who are equally biased and directly attack the previous guys sources.  Niiiice. 

 

 Next up, proof positive the Jews are Satan, as illustrated by Hezbolla, rebuted by Jews for Zion (made that one up......l)

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#13) On June 30, 2009 at 5:37 PM, lucas1985 (< 20) wrote:

"You're like my personal very own troll."
You're one of the greatest spin doctor in CAPS, so what?

"Did you read articles #4 & 5?"
Yes, I did read them. Clearly, you haven't read them.

"They were attacks on IER"
For the nth time, since when is exposing the HUGE conflicts of interests of someone considered a personal attack? Do you take everything at face value? Don't you analyze the expertise, qualifications, publication record, consistency, conflicts of interest, reliability of sources, framing of questions, wording, logic chain, etc of a person making a extraordinary claim?

"Can you dispute any of the material presented in the IER article?"
Yes, I can. That would require a significant amount of time which I don't have and a lengthy rebuttal because there's not a single bit of truth in that article. BTW, the IER continues with his policy of manufacturing doubt (1) which is nicely addressed by Joe Romm:
"Denial makes strange bedfellows.
Two of the leading sources of anti-scientific disinformation on global warming — George Will and Anthony Watts’ blog WattsUpWithThat — have embraced a man, Robert Bradley, who proudly shilled for Enron CEO Ken Lay, who was convicted on fraud and conspiracy charges in 2006.
Watts and I, you may recall, got into a tiny dustup a couple weeks ago (see Exclusive: New NSIDC director Serreze explains the “death spiral” of Arctic ice, brushes off the “breathtaking ignorance” of blogs like WattsUpWithThat and here).   Since then, Watts has been throwing everything at me including the kitchen stink, with four full posts attacking me this month.  I was planning to ignore him, until two things happened.
First, Watts ran a truly nonsensical piece (here) by Bradley, who is now President of the Institute for Energy Research, which “has received $307,000 from ExxonMobil since 1998.”  Bradley is one of the Denier-Industrial-Complex Kooks (DICKs) — see, for instance, “Mysterious industry front-group affiliated with Ken Lay’s former speechwriter launches anti-Waxman-Markey ads with phony MIT cost figures.”
Second, George Will published a piece, “Tilting at Green Windmills” in which he uses a discredited Spanish “study” to claim clean energy investments don’t create jobs (for debunking by CP and the Regional Minister of Innovation, Enterprise and Employment for the Government of Navarre, see here and here and here).  Will’s piece is noteworthy for this remarkable admission:
    [This] study was supported by a like-minded U.S. think tank (the Institute for Energy Research, for which this columnist has given a paid speech.
That’s right, George Will published an entire piece based on disinformation bought and paid for by a think tank that is bought and paid for by ExxonMobil and run by Ken Lay’s former top shill — and Will also took money from that think tank.
At least editorial page editor Fred Hiatt required that much in return for letting Will publish his umpteenth article full of misleading and inaccurate statements.
Now you may say, wait a minute, Joe, sure Bradley served as Director of Public Policy Analysis at Enron, where he was a speechwriter for CEO Kenneth Lay,” who was “convicted on fraud and conspiracy charges on May 25, 2006? — but how can you say he proudly shilled for Lay when he has wiped any trace of his connection to Enron from his IER bio here?
Well, I have had the misfortune of knowing Bradley for a long time, since Enron Energy Services (EES) reached out to many leading experts on energy efficiency, and they really liked by book, Cool Companies.  Certainly none of the energy efficiency folks were aware of what Enron was doing or they would have quit immediately.  I don’t even know if anyone in EES management knew what Ken Lay and his buddies in top management were doing to fraudulently rip-off the public.
And I have no idea whether Bradley knew of the fraudulent activity, but he certainly knew what kind of company he was working for.  Over the past several months, Bradley has bombarded me with requests to publish articles about the disinformation he and his IER buddies have written.  Just last month he wrote to me and James Hansen:
    I wish you (and him) could have been in the Enron government affairs meetings on CO2 trading–we were going to game it to death and make money coming and going. And no one was quaking about the future of global climate.
and before that he wrote to us:
    We were going to laugh all the way to the bank with our CO2 trading until the banks said no more laughing–you’re broke.  Keep trying Joe–Enron Lives!
As the Biblical Proverb says, “Pride goeth before destruction, and an haughty spirit before a fall.”
Enron does live in on the likes of people like Bradley.  That’s why Waxman-Markey has put in many safeguards to protect the public from fraud in the CO2 trading.
Does that mean the system will be free from fraud?  Of course not.  You can write all the laws you want against fraud and robbery and other crimes, and greedy people who think they are smarter than everyone else will still break the law.  The same is true of the tax code — people try to cheat it all the time and some succeed.
But one thing you can certainly say about CO2 trading:  The overwhelming majority of CO2 emissions come from the combustion of fossil fuels, and flows of natural gas, oil, and coal are very closely tracked in this country, both sales and purchases.  So it would be quite hard to engage in significant fraud of the kind that would lead to, say, much higher actual emissions than were being measured and regulated.  And as for cornering the market and running up the price of a tradable commodity, an Enron specialty, again, W-M has multiple safeguards to prevent that outcome.
I am not going to waste time here debunking the latest Bradley-Watts attack on me since I have dealt with almost every point in previous posts.  It is 100% nonsense, which is it no surprise since it is largely an excerpt from something Roger Pielke, Jr. wrote.  But it does contain one unintentionally humorous attack I will address in a later post.
The point is that one shouldn’t have to debunk anything Bradley writes — or anything the Institute for Energy Research has published or supported, including George Will.  You just need to consider the source."
(2)

If I want information on the intersection between climate science and economics I read the peer-reviewed scientific literature (3) and not the babbling of a man (4) who worked for a fraudulent firm, was convicted of fraud and receives money from the fossil fuel lobby. It really is that simple. We want to correct a market failure (mispricing of carbon-intensive energy sources and GHG emissions) by implementing measures that can bring the externality of climate-altering emissions back into the economic system using market-based procedures as far as it's possible. Your spinning efforts can't change this fact.


1- http://www.defendingscience.org/Doubt_is_Their_Product.cfm
2- http://climateprogress.org/2009/06/28/george-will-wattsupwiththat-robert-bradley-ken-lay-enron/
3- http://www.realclimateeconomics.org/
4- http://www.sourcewatch.org/index.php?title=Robert_L._Bradley

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#14) On July 01, 2009 at 9:01 AM, whereaminow (< 20) wrote:

I must be mistaken. I thought that the whole point of debate was persuasion.  If I haven't made it clear, the process by which you will persuade me that I am wrong is by disputing the material presented, not the source.  If you can not, or will not do that, then we have nothing to discuss. 

David in Qatar

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#15) On July 01, 2009 at 2:48 PM, lucas1985 (< 20) wrote:

I thought that the whole point of debate was persuasion.
Debate? Which debate? Spewing pre-digested talking points isn't debate. If you're not able to read a science journal or comb through the Stern Review to capture the essential facts of the costs of climate change and instead opt to take the "dittohead approach" and parrot the soundbites manufactured by spurious interests that's your problem, not mine.
You should be persuaded by the facts and not by the logical arguments of some random dude on the Internet. But then, market failures are anathema to Austrian economics so you just put your head in the sand and pretend that global warming is a liberal plot to tax America to the death and enrich Al Gore in the process.

disputing the material presented
Look at the science of climate economics which forms the foundation of this bill:
- Reviews of models: http://www.realclimateeconomics.org/reviews_of_models.html
- Uncertainty and worst-case risks:  http://www.realclimateeconomics.org/uncertainty_and_risks.html
- Benefits/damage valuation: http://www.realclimateeconomics.org/benefits_damage_valuation.html
- Costs of mitigation: http://www.realclimateeconomics.org/costs_of_mitigation.html
The progressive community doesn't view Waxman-Markey as a piece of perfect policymaking. Lots of progressives and environmentalists were/are opposed to Waxman-Markey because they think it's been weakened way too much in the name of bipartisanship and consensus. However, we can't wait for the perfect bill if we want to avoid the worst outcomes.

not the source.  
"The point is that one shouldn’t have to debunk anything Bradley writes — or anything the Institute for Energy Research has published or supported, including George Will.  You just need to consider the source." Joseph Romm, Climate Progress.
I should contact Bernie Madoff for investment advice and get my medical facts from the Tobacco Institute.

If you can not, or will not do that, then we have nothing to discuss
So you can feel free to spin and reframe nonsense and spoon-fed it to the gullible and uneducated.

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#16) On July 15, 2009 at 1:39 PM, lighthouse99 (< 20) wrote:

Re Lucas

The overwhelming majority of CO2 emissions come from the combustion of fossil fuels, and flows of natural gas, oil, and coal are very closely tracked in this country, both sales and purchases.  So it would be quite hard to engage in significant fraud of the kind that would lead to, say, much higher actual emissions than were being measured and regulated.

Exactly!  And the point against Cap and Trading is that it is bad whatever you want - less emissions or not.

I am in Europe so I am hardly a political insider or whatever...

Given the unproven emission reduction effects on global temperature - and the expense of emission reduction - the key is to engage in activities valuable in themselves, which also keep on track with emission reduction targets at minimal business disruption and expense.

Emission reduction could therefore also be much simpler, and  easier to agree on - without emission trading complicating international trade relations.
 
Sufficient first phase 2020/2030 emission reduction is achieved by acting on ELECTRICITY generation (coal, gas) and TRANSPORT (mainly automobiles) alone, since these 2 sectors typically (as in the USA) account for 80% of greenhouse gas emissions.


The focus on electricity and transport gives several advantages:
1. Local environmental benefit from less pollution of sulphur and all else that’s in the emissions, regardless of the less certain or immediate global benefit from CO2 reduction.


2. Electricity supply alternatives which together with improved grid distribution gives better competition and keeps down electricity bills for consumers.


3. Transport alternatives (using electricity, hydrogen and other energy sources), which give variety of choice and competition advantages for consumers, additionally reducing the dependency on oil imports.


4. No trade problems: Unlike Cap and Trade, which involves cement, steel and other industries having to face imports from unregulated countries, the here suggested electricity and transport changes are not just more limited, but also largely local. Since there is little competition between say utility companies internationally, "best practice" results can be compared and shared.
 
Funding and Impact
Equity and long term loan finance can be used: Long term industrial loans from financial institutions, particularly if federal/state guaranteed, give low yearly interest repayments and lessen the effect on electricity bills or transport cost.


Compare with
today’s all-encompassing Cap and Trade (emission trading) suggestions, with unpredictability, expense, and needless disruption from normal business practice on one hand, or unnecessary profiteering from free allowance handouts with little actual emission reduction on the other hand - together with extensive  -and unnecessary- regulation on what people can or can’t buy and use.

(see my previous post above as regards why all the Energy Efficiency regulation in the Energy Bill  is wrong and unnecessary )


Understanding why proposed Cap and Trade (Emission Trading) is so bad, in USA and elsewhere


 Market Reduction of CO2: Cap and Trade - or Not?
Basic Idea -- Offsets -- Tree Planting -- Manufacture Shift -- Fair Trade -- Surreal Market -- Real Market -- Allowances: Auctions + Hand-Outs -- Allowance Trading -- Companies: Business Stability + Cost --
In Conclusion

http://www.ceolas.net

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