How Much Will Cap-and-Trade Cost You?
Last week saw a couple of bad Congressional Budget Office results for health care. But it saw a good CBO result for cap-and-trade. Dave Camp, the ranking Republican on the House Ways and Means Committee, asked the CBO to take a look at the Waxman-Markey climate change bill. In particular, he wanted to know how much it would cost American families. The CBO happily complied. The answer? $165 for the average household. And if you're in the poorest fifth of the population, you'll actually get $40 back. Here's the table:
That number is for 2020. And it's pure cost. The CBO's analysis does not "encompass the potential benefits associated with any changes in the climate that would be avoided as a result of the legislation."
Furthermore, the bill will actually be cheaper for consumers in the years after that. In the early years, many of the carbon permits are simply given away. In the later years, those permits are sold, and the proceeds rebated to taxpayers. That's why the policy doesn't end up costing us much money. But in 2020, the year CBO examines, that process hasn't been completed: 17 percent of allowances will be sold and 83 percent given away. By 2035, about 70 percent of allowances would be sold, with only 30 percent given away.
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