Cap and Trade vs. the American Dream

National Review
The global-warming bill got a chilly reception when it was introduced in the House Energy and Commerce Committee’s global-warming subcommittee. It was not only the subcommittee’s Republicans but also a number of its Democrats who had serious questions about the proposal to slash greenhouse-gas emissions.

Unable to win subcommittee support for the bill, committee chairman Henry Waxman (D., Calif.) and his chief environmental lieutenant, Ed Markey (D., Mass.), had to withdraw it and go back to the drawing board. After intense closed-door negotiations, they returned to the full committee with a new version last Friday, May 15. Early indications are that this “new and improved” version now contains enough sweeteners to make it palatable to committee Democrats made queasy by the original draft.

These reluctant Democrats hail from states with heavy concentrations of manufacturing employment, lots of electricity generated from “dirty” coal, robust energy sectors (oil refineries, offshore platforms, etc.), and other characteristics that make their districts ground zero for any cap-and-trade scheme. Given all this, one would assume that the fruits of these negotiations would be a watered-down proposal that destroyed fewer jobs, imposed lower increases in energy costs, and demanded less austere lifestyle changes.

One would be wrong. Economists at the Heritage Foundation’s Center for Data Analysis plugged the new provisions of the draft proposal into a sophisticated model of the U.S. economy. The results were nothing short of astonishing: The negotiations succeeded in making the revised plan even more economically debilitating than the original.

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