21 May 2009

Modern Day Indulgences - The Cap & Trade Scam

Have you ever heard of "indulgences"? I'm not talking about sitting down with a box of Lofthouse cookies or going elbow deep into a hand-packed pint from Baskin-Robbins... I'm talking about the difference between asking for permission and begging for forgiveness. In essence, an indulgence merges the two concepts so that you can be totally absolved of responsibility, well, beforehand, kind of... Let me explain…

While that is pretty much the layman’s understanding (for those laymen who have heard of the idea), the church doesn't specifically see it that way. Work with me here, we're building to a salient point. While the church has (had, they technically outlawed the practice long ago) specific guidelines regarding indulgences, throughout history, when indulgences have been sold by the church (for whatever reason), people viewed them predominantly as paying cash to the church to absolve one's sins - beforehand. Now the church gets very semantic with this and says that because forgiveness is presupposed for a believer, the indulgence is really a way for a person to avoid the personal punishment required for sins committed. Or as I understand it, permission to sin.

Okay… so that’s a brief overview. If you want to know more, check Catholic.com for a “primer” on the topic as well as learning about the “myths” of indulgences. I've tried to be as representative as possible based on my non-Catholic understanding of the topic. The NY Times, not an often quoted source, does a fair job of discussing their resurgence in today’s society though…

Okay, with the “indulgences” concept in mind… switch gears and think about the latest buzzwords Cap & Trade. This is the Obama administration’s wild-eyed plan to … you guessed it… sell modern day indulgences. But they'll be selling to businesses whose operations emit CO2. See how that all comes together?

Basically, here’s how Cap & Trade works: The government will set an arbitrary “cap” on the overall amount of CO2 emissions that can enter the atmosphere from all American companies in a given year (if it sounds ridiculous now, you can stop reading and begin opposing the policy, otherwise, it gets better). Then, the government will sell these licenses, i.e., indulgences, through a FREE-MARKET system (more government intrusion into private business) to all these businesses whose mission it is to pollute our skies. Some businesses will use their allotments wisely and they'll be fine. Others will be under their allotment and most will probably go over. That’s where the “trade” comes in. Companies who are under, can sell their licenses to those who go over so that it all balances out.

The Pew Center goes into a bit more detail, but you get the idea… Think carbon offsets for big business and the government. (Side note: what an incredibly stupid idea carbon offsets are. See for yourself. You may as well keep your money and burn it for heat! At least its tangible!).

Here’s the problem. The Cap & Trade program does NOTHING to curtail emissions. Bigger “polluters” will still go over, but they will BUY the permission to do so. And then, if they go over further, well, it will likely only be a fine to the government. The indulgences will be bid up in times when the deadline for compliance is near and as those license bidding costs go up for those who pollute more, guess what? So will your energy bills. Using many of the government's own data, the Heritage Foundation has excellent resources on the impact this legislation will have on businesses and consumers.

It’s sort of like the luxury tax in baseball. If you go over the salary cap, you pay a tax. But in baseball that tax is passed on to fans who buy tickets, concessions, merchandise, etc. In energy markets, those costs will be passed on to consumers who buy gas, turn on lights, use air conditioning, i.e., you. Corporations do not pay taxes. Consumers do. It’s all built in to the prices of goods and services. They pass it on 100% - if not more. And you can bet that companies will overestimate their costs to play in cap & trade and make money while you sit in a 90 house in the summer, a 60 house in winter, and your car sits in the driveway – all the while paying for their in CO2 pollution indulgences.

Here’s another thing… the biggest polluters on the planet, China and India… well, they don’t bother with such trivial things. They will still pollute freely at amazingly exponential levels compared to what American business does today. We also do not know how government operated installations will fare in this madness. Will they too be forced to buy indulgences? Or will they be exempt?

So, to recap… The government picks a number between 1 and a gazillion and then sells licenses to pollute that amount. These are then bid on and traded between polluters. As a consumer of energy, you are abused like a casino ATM spitting out winnings to a drunk. For reference, the Democrats estimate it to be about a $300 per year increase while the Republicans estimate it closer to $3500 per year. Clearly they have all this climate change down to a science and the numbers prove it, right Mr. Gore?

Of course, those who think this is such an outstanding policy are those with a vested interest in the whole scam. Never mind the fact that there is no conclusive science that the same CO2 that comes out of your mouth when you exhale damages the “environment” – ambiguously defined as the atmosphere around anyone interested in global warming…

I urge you to oppose the Waxman-Markey Climate Change bill with every fiber of your being. Even with some smart Democrat resistance, this will be pushed through Congress this year. Count on it. It will also likely be signed as fast as possible with little debate or scrutiny of what the actual legislation entails (remember the 5-day online review promise for final legislation? Obama doesn’t either…).

Once again, the “politics of hurry” will win out and taxpayers will be left out in the cold… literally.


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