The STOCK Act’s Muzzle and How to Fix it in Conference (Update)

Good News/Bad News On Human Spaceflight Regulation

Utah Doubles Down on Gambling Prohibition

Facebook Filing Blasts Obama-Bush Overregulation of Sarbanes-Oxley and Dodd-Frank

Justice Kagan Should Recuse Herself from Obamacare Case

Michigan SEIU Scam the Product of Government Collective Bargaining

heritage foundation

The Lazy Non-Poor People Below the “Poverty” Line Who Get Welfare, and the Hard-Working Poor Above it Who Get Taxed

by Hans Bader on September 13, 2011 · 6 comments

in Legal, Politics as Usual, Zeitgeist

There are plenty of people below the poverty line who aren’t really poor, and some people above the poverty line who are indeed quite poor. The poverty line is a very arbitrary measure seemingly designed to justify lots of spending on welfare and social services for “disadvantaged” people who aren’t really poor, spending that generates jobs for government employees (and government-subsidized non-profits) who provide welfare and handouts.

Robert Rector of the Heritage Foundation explains how many people below the poverty line aren’t really poor at all:

There is a wide chasm between the public’s concept of poverty and “poverty” as it is defined by the Census Bureau. The public generally thinks of poverty as . . . homelessness, or malnutrition and chronic hunger. In reality, the vast majority of those identified as poor by the annual census report did not experience significant material deprivation.
In a recent Rasmussen poll, adults agreed (by a ratio of six to one) that “a family that is adequately fed and living in a house or apartment that is in good repair” is not poor. By that simple test, about 80 percent of the Census Bureau’s “poor” people would not be considered poor by their fellow Americans.
In the same Rasmussen poll, however, 73 percent said poverty was a severe problem. Why the disconnect? The answer: Public perception of poverty in the U.S. is governed by the mainstream media, which invariably depicts the Census Bureau’s tens of millions of poor people as chronically hungry and malnourished, homeless or barely hanging on in overcrowded, dilapidated housing.
The strategy of the media is to take the least fortunate 3 percent or 4 percent of the poor and portray their condition as representative of most poor Americans. . .[But] they are far from typical among the poor. . . a poor child in American is far more likely to have a widescreen plasma television, cable or satellite TV, a computer and an Xbox or TiVo in his home than he is to be hungry. . .In 2009, the U.S. Department of Agriculture asked parents living in poverty this question: “In the last 12 months, were [your] children ever hungry but you just couldn’t afford more food?” Some 96 percent of poor parents responded “no”: Their children never had been hungry because of a lack of food resources at any time in the previous year. . . .
Here are more surprising facts about Americans defined as “poor” by the Census Bureau. . .
Eighty percent of poor households have air conditioning. By contrast, in 1970, only 36 percent of the entire U.S. population enjoyed air conditioning. Fully 92 percent of poor households have a microwave; two-thirds have at least one DVD player and 70 percent have a VCR. Nearly 75 percent have a car or truck; 31 percent have two or more cars or trucks. . .Nearly two-thirds have cable or satellite television. Half have a personal computer; one in seven have two or more computers. More than half of poor families with children have a video game system such as Xbox or PlayStation. . . A third have a widescreen plasma or LCD TV. . .
At a single point in time, only one in 70 poor persons is homeless. The vast majority of the houses or apartments of the poor are in good repair; only 6 percent are over-crowded. The average poor American has more living space than the average non-poor individual living in Sweden, France, Germany or the United Kingdom. . .Forty-two percent of all poor households own their home; on average, it’s a three-bedroom house with one-and-a-half baths, a garage, and a porch or patio. . . among the lowest-income fifth of households, inflation-adjusted consumer spending actually increased modestly during the recession.
Given these facts, how does the Census Bureau conclude that more than 40 million Americans are poor? They identify a family as poor the family’s cash income falls below specific thresholds. For example, in 2009 a family of four was “poor” if annual cash income fell below $21,954.
But in counting income, the Census Bureau ignores almost the entire welfare state. This year, government will spend over $900 billion on means-tested anti-poverty programs that provide cash, food, housing, medical care and targeted social services to poor and near-poor Americans. . .This means-tested welfare spending comes to around $9,000 for each poor or low-income American — virtually none of which is counted by census officials for purposes of calculating poverty or inequality.

[click to continue…]

Brava, Sen. Murkowski

by Marlo Lewis on June 14, 2010

in Global Warming

Last Thursday, by a vote of 53-47, the Senate rejected S.J.Res.26, Alaska Sen. Lisa Murkowski’s resolution of disapproval to overturn EPA’s endangerment rule.

Although Sen. Murkowski fell four votes short of achieving a legislative victory, she nonetheless won an important political victory.

During the past four-plus months, despite vicious attacks by eco-pressure groups and preemptive cringing by the subsidy dependent auto industry, Sen. Murkowksi worked patiently, calmly, and indefatigably to clarify the real issues, which are: (1) “The sweeping powers being pursued by EPA are the worst possible option for reducing greenhouse gas emissions”; (2) “politically accountable members of the House and Senate, not unelected bureaucrats, must develop our nation’s energy and climate policies”; and (3) ”those policies must be able to pass on their own merits, instead of serving as a defense against ill-considered regulations.”

All 41 Republican Senators and six Democrats voted to stop EPA from ‘enacting’ controversial global warming policies through the regulatory back door. This means Democratic leaders have become the Party of Endangerment — the party taking ownership of the regulatory consequences of EPA’s endangerment rule; hence the party taking responsibility for the economic fallout.

By denying President Obama bipartisan cover for greenhouse gas regulation under the Clean Air Act, Sen. Murkowski has made EPA’s endangerment rule a political liability for Democrats and a political asset for Republicans in an election year.

That should increase the pressure on moderate Dems and Republicans alike to distance themselves from Democratic leaders and eschew cap-and-trade, which, like EPA’s regulations, would increase consumer energy prices, killing jobs and growth.

Sen. Murkowski’s opening and closing statements in the floor debate clearly and cogently explain how the endangerment rule imperils our economy and representative democracy. Below are some noteworthy excerpts.

Excerpts from Sen. Murkowski’s Opening Statement

The sweeping powers being pursued by the EPA are the worst possible option for reducing greenhouse gas emissions. . . .It would amount to an unprecedented power grab, ceding Congress’ responsibilities to unelected bureaucrats, and move an important debate from our open halls to behind an agency’s closed doors.

* * *

The only similarity I see between the spill in the Gulf of Mexico and EPA’s regulations is that both are unmitigated disasters — one happening now, the other waiting in the wings if Congress fails to adopt this resolution.

* * *

No one is more aware of this uncomfortable fact [that EPA's regulatory net would expand by orders of magnitude] than the EPA itself. That’s why the agency has attempted to dramatically increase the thresholds for greenhouse gases in its so-called tailoring rule. Unhappy with the plain language of the Clean Air Act, the agency plans to lift its limits up to 1,000 times higher than Congress directed. It’s deeply disturbing that EPA did not accept that the Act is simply not structured for this task, and instead attempted to make it so by ignoring the plain language and unilaterally amending it.

* * *

I encourage my colleagues to think about the logic behind the tailoring rule. The EPA is asking us to accept that while greenhouse gases are not in the Clean Air Act, Congress clearly intended them to be regulated under it. At the same time, we’re expected to believe that while explicit regulatory thresholds are in the Act, Congress meant for EPA to ignore them.

* * *

To this day, the agency still has not provided anything close to a full projection of the economic impacts that its economy-wide climate regulations will have. There are two potential reasons why: the EPA either has no cost estimates, or knows they are too astronomical to calculate and release.

* * *

The problem is that BACT [best available control technology] remains completely undefined at this point. It could mean efficiency improvements, expensive add-on technologies, or even fuel-switching requirements. Over time, the EPA would have little choice but to impose all of those requirements and more, regardless of the consequences.

* * *

Again, it’s hard not to find this both surreal and deeply alarming. We need to be growing our economy, not paralyzing it.

* * *

This brings me to my final point: politically accountable members of the House and Senate, not unelected bureaucrats, must develop our nation’s energy and climate policies. And those policies must be able to pass on their own merits, instead of serving as a defense against ill-considered regulations.

* * *

Nor is it [S.J.Res.26] about fuel efficiency — the Department of Transportation is and has been in charge for 35 years, and we don’t need another agency and another standard thrown into the mix to do the same job . . . .The EPA does not need to take over this process, and it should not be allowed to do so under a law that was never intended to regulate fuel economy.

* * *

Bringing climate science, the oil spill, and fuel economy into this debate are attempts at misdirection — “green herrings” intended to convince members to oppose our resolution. But this debate has nothing to do with those topics. . . .It’s about maintaining the separation of powers between the legislative and executive branches, as our founding fathers intended, and rejecting an unprecedented overreach by the EPA into the affairs of Congress.

Excerpts from Sen. Murkowski’s Closing Statement

Most cynical are the efforts to link our resolution to the oil spill. That serves only to cheapen the horrible and ongoing tragedy in the Gulf of Mexico and distract from the reasons why 41 Senators sponsored this resolution. Here’s the real question: why is the EPA attempting to impose economy-wide regulations — regulations that will not help clean up or prevent future accidents — instead of focusing its resources on the spill?

* * *

We’ve heard that our resolution is anti-science. Some of our supporters agree with it [EPA's endangerment analysis], and some do not. The reality is that the science is what it is, and it is beyond the power of Congress to change. But this is an issue of the best way, and the most appropriate body, to respond to the conclusions being reached by members of the scientific community.

* * *

Threatening to disrupt our nation’s economy until we pass a bill by the slimmest of margins, regardless of its merits, won’t be much of an accomplishment. Nor is that approach worthy of the institutions and people we serve. It isn’t appropriate for a challenge of this magnitude. No policy that results from it will achieve our common goals or stand the test of time.

* * *

Today is the day for the Senate to take the threat of EPA climate regulations off the table once and fall all. . . .By passing our bipartisan resolution of disapproval resolution, we can return the debate over climate policy to its rightful home, here in Congress, where duly-elected representatives can represent the best interests of their constituents.

Obama Administration Rewards Corrupt Mortgage Giants, Punishes Productive Private Banks, Fleeces Taxpayers and Responsible Credit Cardholders

by Hans Bader on March 10, 2010 · 3 comments

in Bailout Watch, Deregulate to Stimulate, Economy, Energy, Environment, Labor, Mobility, Natural Resources, Politics as Usual, Precaution & Risk, Regulation, Sanctimony

The Obama administration wants to increase taxes on productive banks that are self-supporting, while exempting the mortgage giants and other companies that got massive taxpayer bailouts. For more details, click on this graph, “Bank-robbing tax lets ‘bad guys’ go free,” courtesy of a Washington think-tank, the Heritage Foundation. It shows that the mortgage giants Fannie Mae and Freddie Mac are exempt and will never have to pay a dime, despite being bailed out by taxpayers at a cost of more than $200 billion, while Bank of America and Wells Fargo, which are solvent and returned all their TARP money, would be forced to pay billions under the administration’s proposed tax.

General Motors and Chrysler won’t have to pay a dime, either, even though the government claimed they were “financial institutions” just like banks in order to use bank bailout money to bail them out at a cost of at least $70 billion (a bailout that would not even have been needed to save the companies if they had simply been reformed to make them competitive, and received relief from burdensome red tape, like poorly-drafted CAFE and global-warming regulations that may backfire. Instead, the Obama administration effectively gave the companies, at taxpayer expense, to the UAW, a powerful union opposed to much-needed reforms).

In other news, economists and real estate experts say that a mortgage bailout program the Obama administration spent $75 billion on has backfired and harmed the real estate market.

Obama recently expanded the bailout of mortgage giants Fannie Mae and Freddie Mac and lavished money ($42 million) on their CEOs.

Under the Bush administration, federal regulators took over Fannie and Freddie in the name of stopping their risky practices. But the Obama administration has increased their purchases of risky mortgages in a vain attempt to inflate the economy. Worse, it forced them to run up to tens of billions in losses to bail out deadbeat and at-risk mortgage borrowers, and then tried to conceal those losses, in conduct reminiscent of Enron. But their management hasn’t objected, because the costly requirements are accompanied by massive taxpayer bailouts and lavish pay for the mortgage giants’ CEOs.

Fannie and Freddie helped spawn the mortgage crisis by acting as loan toilets, buying up risky mortgages and thus creating an artificial market for junk. “From the time Fannie and Freddie began buying risky loans as early as 1993, they routinely misrepresented the mortgages they were acquiring, reporting them as prime when they had characteristics that made them clearly subprime.”

Why did they buy these risky loans? They put up with Clinton-era affordable-housing regulations that required them to buy up lots of risky loans, in order to curry favor on Capitol Hill and thus retain their annual $10 billion in tax and other special privileges (which they possessed owing to their status as “Government-Sponsored Enterprises” or GSEs). They paid their CEOs millions in the process, and engaged in massive accounting fraud — $6.3 billion at Fannie Mae alone — to increase the size of their managers’ bonuses. As GSEs, they were exempt from the capital requirements that apply to private banks, so they did not have enough reserves to cover their losses when their mortgages started defaulting.

At the direction of the Obama administration, Freddie Mac is now running up $30 billion in losses to bail out mortgage borrowers, some of whom have high incomes. Federal regulators sought to make Freddie Mac hide the resulting losses from the SEC and the public.

Under Obama’s proposed financial “reforms,” banks will be pressured to make even more risky, low-income loans. Obama has sent to Congress his proposal to create a politically correct entity called the Consumer Financial Protection Agency, tasked with enforcing the Community Reinvestment Act. Government pressure on banks to make low-income loans was a key reason for the mortgage meltdown and the financial crisis. Yet Obama’s proposals would empower the new agency to enforce the Community Reinvestment Act, which was a key contributor to the financial crisis, without regard for banks’ financial safety and soundness.

Moreover, Obama’s proposed financial rules do absolutely nothing to reform Fannie Mae and Freddie Mac, admits Treasury Secretary Timothy Geithner, even though he admits that “Fannie and Freddie were a core part of what went wrong in our system.”

Meanwhile, a new law backed by the Obama administration, the CARD Act of 2009, has effectively forced responsible credit-cardholders to subsidize irresponsible people, leading to the return of annual fees on many credit cards, and the elimination of many cash-back and rewards programs. My wife, who has an excellent credit rating, was recently informed that one of her cards will now have an annual fee — of $60! (She promptly canceled the card.)

Waxman-Markey’s impact on housing prices — more than your average postage stamp

by Marlo Lewis on January 7, 2010

in Global Warming

Proponents of the Waxman-Markey (W-M) cap-and-trade bill assure us it will cost the average household less than a postage stamp a day. The Heritage Foundation’s energy team — David Kreutzer, Ben Lieberman, Karen Campbell, William Beach, and Nicolas Loris — have rebutted this claim six four ways from Sunday (see here, here, here, and here).

Some postage stamps, of course, cost more than most people’s homes. For example, this rather plain looking item, a two-pence stamp issued by the Mauritius post office in 1847, sells for $600,000 or more.

Now, nobody is saying that Waxman-Markey will cost the average household what it costs to buy a mansion, but the National Association of Home Builders (NAHB) estimates that W-M could increase the purchase price of a new home by $1,371 to $6,387, and that this would have the effect of making 337,000 to 1.57 million households unable to qualify for a home mortage. Repeat after me: “Law of Unintended Consequences!”

NAHB summarizes its analysis on pp. 13-14 of its December 30, 2009 comment on various EPA rulemakings regarding greenhouse gases (GHGs) under the Clean Air Act. Here are the main steps:

To produce the materials used to construct a typical single-family home (2,420 square feet plus two-car garage), manufacturers emit 55.42 metric tons (MT) of carbon dioxide-equivalent (CO2-e) GHGs.
The U.S. Energy Information Administration (EIA), using a 4% discount rate, projects that under W-M, carbon allowances in 2030 would cost between $19 and $87 per MT.
Manufacturers’ costs for producing homebuilding materials would increase by $1,037 to $4,831 per single family home (when I do the arithmetic, I get an increase of $1,052 to $4,821).
Factor in additional financing and broker commissions, and the price of a typical single-family home would increase by $1,371 to $6,387.
To qualify for a mortgage, borrowers may not exceed a specific “front end ratio” — the percentage of income that would be consumed paying principal and interest on the mortage, plus property taxes and insurance. A common standard is that these payments should not exceed 28% of household income.
In the low-cost case (carbon permit price = $19/MT CO2-e), roughly 337,000 households that would qualify for a mortgage before the W-M-induced price increase, no longer qualify. In the high-cost case (carbon permit price = $87/MT CO2-e), approximately 1.57 million U.S. households are priced out.

Some enterprising reporter should jump on this. What do Reps. Waxman and Markey have to say about NAHB’s analysis? When they drafted the bill, what assumptions did they make about its potential impacts on housing prices and homeownership? Indeed, can they adduce any evidence that they gave even a moment’s consideration to these important matters?

Will climate change cause water wars? Will Waxman-Markey enhance U.S. energy security? No and No.

by Marlo Lewis on September 21, 2009

in Energy, Ethanol, Global Warming

Last week, on the free-market energy blog MasterResource.Org, I posted a two-part column on climate change and national security. In a nutshell, I argued that global warming is likely not an important geopolitical or military “threat multiplier,” and that the national security risks of climate change policies likely outweigh those of climate change itself.

One of the great things about “publishing” on the Internet is that readers can quickly and easily share other insights and information the author had not considered.

Climate scientist and fellow blogger Chip Knappenberger called my attention to a remarkable essay in Nature magazine by Wendy Barnaby, editor of People & Science, the journal of the British Science Association — and to Chip’s review of Barnaby’s essay on WorldClimateReport.Com.

One of the principal ways climate change supposedly acts as a “threat multiplier” is to intensify drought and water shortages, leading to crop failure, famine, and armed conflict within and among nations. Barnaby had written a book about biological warfare, and the publishers suggested she write a book about the coming century of “water wars.”

At the outset, she assumed that water scarcity is a signifcant source of armed conflict in the world – a pervasive problem just waiting to be ‘threat multiplied’ by climate change. The book was to include a history of water wars, but, as she dug into her topic, she found there wasn’t much history to write about. ”Cooperation, in fact, is the dominant response to shared water resources,” she discovered. The data are overwhelming:

Between 1948 and 1999, cooperation over water, including the signing of treaties, far outweighed conflict over water and violent conflict in particular. Of 1,831 instances of interactions over international fresh water resources tallied over that time period (including everything from unofficial verbal exchanges to economic agreements or military action), 67% were cooperative, only 28% were conflictive, and the remaining 5% neutral or insignificant. In those five decades, there were no formal declarations of war over water (emphasis added).

It is true that many nations are water-stressed, but this has not meant that their people must either perish or go to war to seize another country’s water supplies. Usually, it means that countries cooperate and import “virtual water” in the form of agricultural produce. It takes lots more water to grow crops than it does to supply households with drinking water. So where water is scarce, people tend to substitute grain imports for home-grown produce. Israel, Jordan, and Egypt are a case in point:

Israel ran out of water in the 1950s: it has not since then produced enough water to meet all of its needs, including food production. Jordan had been in the same situation since the 1960s; Egypt since the 1970s. Although it’s true that these countries have fought wars with each other, they have not fought over water. Instead, they all import grain. As [U.K. social scientist Tony] Allan points out, more ‘virtual’ water flows into the Middle East each year embedded in grain than flows down the Nile to Egyptian farmers.

Climate change-related drought would pose challenges to resource managers but should not lead to armed conflict where nations are free to cooperate and trade. (As noted in my MasterResource column, cap-and-trade treaties require carbon tariffs for enforcement — a recipe for conflict and trade war rather than cooperation and trade.)

Barnaby’s conclusion is worth reproducing in full:

Book or no book, it is still important that the popular myth of water wars somehow be dispelled once and for all. This will not only stop unsettling and incorrect predictions of international conflict over water. It will also discourage a certain public resignation that climate change will bring war, and focus attention on what politicians can do to avoid it: most importantly, improve the conditions of trade for developing countries to strengthen their economies. And it would help to convince water engineers and managers, who still tend to see water shortages in terms of local supply and demand, that the solutions to water scarcity and security lie outside the water sector in the water/food/trade/economic development sector. It would be great if we could unclog our stream of thought about misleading notions of ‘water wars.’

Waxman-Markey would increase U.S. dependence on petroleum product imports

As discussed in my column on MasterResource.Org, U.S. dependence on oil, including oil imports, is not a “crisis.” Nonetheless, many eco-warriers and defense hawks claim that it is. They also claim that Waxman-Markey would enhance U.S. energy security by inaugurating the transition to a “beyond petroleum” economy.

Well, another colleague sent me a report showing that Waxman-Markey would make us more dependent on petroleum product imports.

The report, prepared by EnSys Energy for the American Petroleum Institute, finds that by 2030, Waxman-Markey would:

Significantly increase U.S. refining costs;
Reduce U.S. refining volume by up to 4.4 million barrels per day (mbd);
Reduce annual U.S. refining investments by up to $89.7 billion (up to an 88% decline in investment);
Reduce refinery utilization rates from 83.3% to as low as 63.4%;
Create competitive advantage for non-U.S. refineries; and, hence
Increase U.S. reliance on petroleum product imports.

EnSys analyzed three scenarios: a “Base Case” (EIA’s reference case projection of future liquid fuels supply and demand without climate legislation); a “Basic Case” (EIA’s analysis of Waxman-Markey assuming timely development of key low-emission technologies and no severe policy constraints on the use of both domestic and international offsets); and a No International/Limited Case (EIA’s analysis of Waxman-Markey assuming limited access to international offsets, and no deployment of key technologies beyond EIA’s reference case).

Okay, now that we understand the terminology, let’s look at some graphs from the EnSys report. First, the impact of Waxman-Markey on U.S. refinery output:

Next, the impact on U.S. refining investments:

Next, the impact on petroleum product imports by volume:

Next, the impact on petroleum product imports by percent:

Finally, the impact of Waxman-Markey on U.S. refining global market share:

Bottom line for “energy security” mavens: Waxman-Markey grows foreign refining output at the expense of U.S. output, and increases U.S. dependence on petroleum product imports.

The EnSys report very likely understates the impact of Waxman-Markey on U.S. refining. A modeling study can only estimate how carbon constraints will affect refining via their impact on fuel prices. Models cannot estimate how carbon-constraints might affect refining via their impact on investor psychology.

Investors can get spooked when government declares regulatory warfare on an industry, and the Waxman-Markey bill does just that. Consider the gross disparity between the refining industry’s share of covered emissions (43%) under Waxman-Markey and its share of emission allowances (2.5%).

Investors cannot be blamed if they view Waxman-Markey as the proverbial “writing on the wall” for the U.S. refining industry. From this I conclude that Waxman-Markey’s adverse impacts on U.S. refining – and thus on the volume and percent of petroleum product imports – could be substantially greater than those EnSys projects.

Conclusion

Waxman-Markey will not take us “beyond petroleum.” Instead, it will make gasoline more costly to consumers while making America more dependent on imported petroleum products.

Firing Blanks on FOIA Part II

by Iain Murray on September 17, 2009

in Economy, Energy, Environment, Global Warming, International, Regulation

In his update to his post, Declan McCullagh notes an objection by the Center for American Progress:

The fourth objection is the most compelling. The Center for American Progress writes: “The potential benefits of clean energy legislation far outweigh the modest costs.” That’s a reasonable cost vs. benefit calculation, and it includes the claim that even with the extra taxes, cap and trade is so vital to America, it’s still worth it.
That’s the right approach to take: it would be a very good thing if all federal regulation were subject to a cost vs. benefit analysis. For example, if rising temperatures are significantly harming the planet, and cap and trade would reduce greenhouse gases enough to slow the rise, that would be a real benefit. But the Center for American Progress never actually makes that argument, and as CEI senior fellow Christopher Horner says: “Nobody has ever said this will change the temperature. It won’t.”

Well, we’ve already covered that one. Even taking the most favorable analysis to WaxKey, the costs to Americans massively outweigh the benefits to them. Here’s my post from a week ago:

There’s a new cost:benefit study from New York University Law School’s Institute for Public Integrity that, its authors claim, shows that, “From almost any perspective and under almost any assumption, H.R. 2454 [Waxman-Markey] is a good investment for the United States to make in our own economic future and in the future of the planet.” A good investment for the US? Really?

The authors recognize that the benefits they find are global, while the costs are located in the US. So let’s see what benefits accrue to US citizens and at what cost. (I am working with the authors’ figures here, which derive from the EPA, and are significantly different from the figures provided by such groups as the Heritage Foundation or the American Council for Capital Formation, which find much, much higher costs.)

Highest possible benefit = $5.2 trillion / 6 billion people = benefits of $866 per person

Cost to US citizen = $660 billion / 300 million people = cost of $2200 per citizen

That means a best possible benefit to cost ratio for a US citizen of 0.4:1.

The report talks about thinking of the Waxman-Markey costs as a “highly effective, highly leveraged form of foreign aid.” One has to doubt that, given that the benefits that accrue to the developing world do so mostly in the far future, while the developing world is in desperate need of greater wealth – and better access to energy – today. Even if it were true, however, one wonders whether the American public will accept a de facto tax increase of around $1300 per person, or $400 billion total, to pay for such climate aid.

Yet that’s assuming that the “high end” benefits scenario is what occurs. The global low end benefits are actually far outweighed by the American costs, leading to a benefit:cost ratio to America of something in the order of 0.05:1 (or a cost:benefit ratio of 20:1).

And, of course, there’s no guarantee that a reduction in American emissions will amount to a reduction in global emissions. We have seen the response to European cap-and-trade schemes being the relocation of facilities to other jurisdictions. If so, the effective foreign aid program of Waxman-Markey might actually be a loss of American jobs to be replaced by developing world jobs, with no emissions reduction at all. That would be very generous of us, but not quite what the authors of this study have in mind.

To summarize, the authors of the study have conclusively demonstrated that the Waxman-Markey bill is actually a very bad deal for the United States, and their attempts to claim otherwise are just spin.

New Paper Shows Staggering Cost to Americans of Waxman-Markey

by Iain Murray on September 9, 2009 · 2 comments

in Economy, Environment, Global Warming, International, Politics as Usual