Waxman-Markey Will Help the Poor, Impose Modest Costs on the Wealthy
Here’s the CBO’s score of the impact of the Waxman-Markey bill on household budgets:
On that basis, the Congressional Budget Office (CBO) estimates that the net annual economywide cost of the cap-and-trade program in 2020 would be $22 billion—or about $175 per household. That figure includes the cost of restructuring the production and use of energy and of payments made to foreign entities under the program, but it does not include the economic benefits and other benefits of the reduction in GHG emissions and the associated slowing of climate change. CBO could not determine the incidence of certain pieces (including both costs and benefits) that represent, on net, about 8 percent of the total. For the remaining portion of the net cost, households in the lowest income quintile would see an average net benefit of about $40 in 2020, while households in the highest income quintile would see a net cost of $245.
A net benefit of $40 to the poorest Americans is a good thing. And a net cost of $245 (less than a dollar a day!) to the wealthiest Americans is, in my view, a small price to pay for the dual goals of preventing extreme hardship and the developing world and reducing the odds of a spiraling-out-of-control climate disaster scenario that threatens the existence of human civilization.
Will these facts impact the debate? Ryan Avent is skeptical:
Emphasis mine. So, how long do you think GOP legislators will continue to use the bogus $1,600 cost per household per year figure they’ve been touting? I’m putting my money on “indefinitely.”
That’s almost certainly true. But something I hope legislators will keep in mind is that what they’re political opponents say about them will almost certainly matter less to voters than what actually happens. If we implement a solid energy reform strategy, people will hear warnings of economic doom and then they’ll see those warnings not come to pass.
40 Responses to “Waxman-Markey Will Help the Poor, Impose Modest Costs on the Wealthy”
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June 21st, 2009 at 3:27 pm
Time is running out. The possibility of stopping shy of 2C of warming is becoming slimmer. In fact, according to the comments from attendees, most climate scientists doubt the political will to do anywhere near enough.
June 21st, 2009 at 3:30 pm
Because govt estimates on the cost of such bills has always been accurate. If you believe these estimates, then you deserve the impoverishing impact this bill will end up having.
June 21st, 2009 at 3:39 pm
then you deserve …
Guess what you deserve.
June 21st, 2009 at 3:51 pm
I deserve the govt I have, which will at best give me 70’s style deflation, and at worst give me ruinous inflation on the model of many South American countries that have tried our current “theory” of economics. What I can say for sure is that the path we are on will not end well.
The only reason we can sustain the level of deficit spending we are engaged in is the reserve status of the dollar. Pay attention to what the BRIC countries are saying and doing; that reserve status is highly unlikely to hold up. When it falls apart, our ability to float the level of debt we are floating now will end with it.
June 21st, 2009 at 3:57 pm
What a difference a good CBO score makes…
which of course is entirely about the politics of dollar signs, not actual impacts.
James Robertson: Better to be floating in debt than in melted ice caps.
June 21st, 2009 at 4:05 pm
Steven – actually no, and it’s not clear that we would be floating in melting icecaps anyway. The reason I say no is simple: countries where the currency has collapsed tend to go through massive social upheaval, often with revolutions and/or civil wars. That’s well documented in history; we know for certain that a currency collapse is something to avoid.
As to climate change, we have no certainty on it at all – the science is not settled, and there’s plenty of debate – not to mention the fact that even the IPCC asserts that the kind of changes being proposed would have minimal impact on anything. High cost, minimal impact – it’s enough to make you wonder what the real goals are.
Either way, a collapse of the currency is a far, far bigger problem with much more immediate risks within the US.
June 21st, 2009 at 4:12 pm
When it falls apart, our ability to float the level of debt we are floating now will end with it.
I don’t know what this has to do with global warming, as opposed to exploding trade deficits going back to the 90’s. It is worth noting that European countries have ratified Kyoto and reduced their CO2 emissions, yet the euro has doubled in value since 2002.
June 21st, 2009 at 4:16 pm
James, the science is fundamentally settled; the only debate is coming from far-right denialists and even the oil companies have backed off their denialism now. Obviously, I’d like stronger policy, but I’ll take getting my foot in the door, picking up some more seats, and then making it stronger in 2011.
June 21st, 2009 at 4:17 pm
As to climate change, we have no certainty on it at all – the science is not settled, and there’s plenty of debate
You have no certainty at all. Don’t bring science into it, because the debate among scientists has been settled a long time ago.
http://www.realclimate.org/index.php/archives/2009/06/a-warning-from-copenhagen/
You could educate yourseld and read this report. Of course you will do no such thing and keep repeating “we need more proof!!!” like flat-earthers and creationists.
June 21st, 2009 at 5:05 pm
Hmmm, these guys say the globe is cooling. They have a chart and everything.
June 21st, 2009 at 5:26 pm
[...] noted earlier the CBO’s analysis indicating that the poorest 20 percent of Americans will actually gain [...]
June 21st, 2009 at 5:39 pm
One, Europe hasn’t stayed within the bounds of Kyoto – not even close. Two, the only reason emissions there dipped at all in the 90’s was the collapse of the Soviet sector, and the follow on closing of many, many inefficient (and highly polluting) plants. That’s especially true for the old East Germany.
As to the science, I’ve read enough from advocates and skeptics to know this: the science isn’t settled, and most of the government money is pushing the “climate change” agenda – so if I need to be skeptical, it’s about the side that gets lots more grant money based on having the “correct” opinion.
June 21st, 2009 at 5:40 pm
Hmmm, these guys say the globe is cooling.
Let’s see, a post dated February 2008 from some guy claiming the Earth is cooling. Sadly, the sources he gives rebutes his idiotic generalization of 12 months of data.
For example, the basic dataset (HadCRUT) used by the UK shows a clear increase in global temperatures since the 50’s:
http://www.cru.uea.ac.uk/cru/data/old-temperature/hemglob.gif
and predicts even more rapid global warming in the future:
http://www.metoffice.gov.uk/climatechange/science/projections/air_time.html
Shooter, I’ll let you go through the other sources that Dailytech blogger claims, see if you can find a single data series supporting your point.
June 21st, 2009 at 6:16 pm
The sky is falling….Give me more of your money!
June 21st, 2009 at 6:47 pm
That’s a shockingly poor way to evaluate scientific evidence. It’s the same rationale that people use to claim that vaccinations cause autism. As for the ‘government conspiracy’ case, that’s easily destroyed by the fact that the scientific community and the career scientists within the government clashed against Bush’s opposition to climate change, even when doing so meant potentially losing grants or their jobs.
June 21st, 2009 at 8:45 pm
Well, JR, you guessed wrong.
June 21st, 2009 at 9:19 pm
Steven – actually no, and it’s not clear that we would be floating in melting icecaps anyway.
By ‘we’, J-Rob means ‘himself’, as always; he’ll ardently support anything that fucks over every other human being on the planet as long as he’s all right.
June 21st, 2009 at 9:51 pm
Well, if you really do believe it’s a catastrophe, then why are you pushing for something that the IPCC says won’t have any impact? What you really want, if you truly believe that what we have is a catastrophe, is a nearly immediate end to all non-natural carbon emissions. So no cars, no coal, no oil.
Let me know when you get serious enough to start advocating that, and a crash program of building nuclear power plants, and of stopping the enviro nuts from roadblocking windmills, solar arrays, and powerlines.
Until you’re willing to do that, I simply can’t take you guys at all seriously. You’re poseurs at best, people with some other kind of agenda at worst.
June 21st, 2009 at 9:57 pm
Hmmm, these guys say the globe is cooling.
…and their evidence is the fact that temperatures in January 2008 were lower than temperatures in January 2007, by an amount that looks identical to the temperature swings that have occurred hundreds of times in the past 130 years.
Congratulations, shooter, you’ve demonstrated that you don’t know enough about statistics to understand that difference between a trend and variability. I’ll make sure to treat your commentary on the subject appropriately.
June 21st, 2009 at 10:44 pm
JR has won the debate against the people in his head.
June 21st, 2009 at 11:06 pm
What I notice is a distinct lack of addressing anything I say. The IPCC does say that acts like Kyoto will have a trivial impact. So if you really think this is a crisis, start acting like it’s one, and start advocating for the kind of sweeping changes a crisis would require – instead of utterly irrelevant moves that would merely increase the cost of energy to Americans
June 22nd, 2009 at 1:07 am
Actually, what you said initially was that the science is unsettled. That point was rebutted convincingly, so much so that you did not further address it and instead changed the subject to the effectiveness of Kyoto in an effort to demonstrate that your opponents advocate a solution that will not solve the problem. Criticizing the proposed means of addressing a problem, of course does, does nothing to support the claim that the problem does not exist.
June 22nd, 2009 at 1:36 am
This inconvenient fact is what has led to the recent downfall of the Republican party. It doesn’t matter so much that Democrats have not been terribly aggressive. The fact is that Republican policies are blamed for the miserable state of the nation. And, I would argue, fairly so.
Of course, the current problem is that, even with a mandate to do something different, our Democratic leadership is mired in the mentality that the electorate is still in a mid-90s mindset. So the Democratic leadership appears to want to do pretty much exactly the same thing.
And that will fail for them just as it did for the Republicans.
You would think that at some point the forces of political evolution would kick in, whereby policies that are actually successful might be rewarded by the electorate. Sadly, while evolution tends to be inevitable, it also can be quite slow.
June 22nd, 2009 at 7:14 am
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June 22nd, 2009 at 7:21 am
I didn’t go back to the science because I can’t be bothered to argue that point with a bunch of blinkered ideologues. I read widely on this issue and it looks like the science is anything but settled. I have my doubts about any impending catastrophe based on the levels of natural variability in the system – but that’s not worth arguing with a bunch of people who think of Al Gore as a prophet.
The other point is even simpler: If you assume the crisis that you all say is coming, your desired set of responses are a stupid joke. They will have no impact other than to raise prices dramatically. They won’t actually change anything in the direction you worry about (doubly so since the Chinese have already told us to screw off on this)
Which is why I can’t really take you guys seriously on this. You advocate actions that are meaningless if you take this problem seriously. You refuse to take on the interests on your side of the aisle that make any action on viable alternative energy sources (more powerlines for remote sources of wind/solar, more nuclear power, more wind/solar in places the enviros won’t countenance them) impossible. You refuse to do anything other than take actions that would make large cars and large houses expensive.
Which is why it’s easy to conclude that there’s an entirely separate agenda in play.
June 22nd, 2009 at 7:39 am
I read widely on this issue and it looks like the science is anything but settled. I have my doubts about any impending catastrophe based on the levels of natural variability in the system – but that’s not worth arguing with a bunch of people who think of Al Gore as a prophet.
The real reason you won’t argue the science is that you’re wrong.
June 22nd, 2009 at 8:26 am
Argued like a true ideologue there – proof by assertion. Natural variability has taken us from the warmth of the Jurassic (much warmer than anything we have now, or are likely to see soon), to the depths of various ice ages. We don’t fully understand how or why that’s happened – and yet you would have us believe that human activity over the last 200 years or so is set to wreck the environment.
Right.
Get back to me when you’re ready to start advocating the types of changes that would be required to halt the catastrophe you claim is coming. Until then, the facts don’t even matter, because it’s clear that you’re nothing but a poseur.
June 22nd, 2009 at 9:23 am
James Robertson, the pre-eminent climate scientist of our time, knows more than the thousands of poopy-head scientists world-wide who worked on the IPCC. Listen to him dimwits!!
On the other hand, to have a troll who types correctly and manages to get his grammar right is a novelty. I, for one, appreciate it.
June 22nd, 2009 at 9:26 am
Numbers J-Rob. Go home, work on numbers. All your pretty arguments do not have a single number in them. Engineers need numbers. Lawyers need arguments. We know who to trust when it comes to technical data.
June 22nd, 2009 at 9:44 am
Robertson, you’re a dope. Something has raised the Earth’s temps. “Natural variability” isn’t a force by itself. It’s a description. There’s been a change in some actual force. The amount of energy trapped due to the increase in GHGs during the industrial age is, coincidentally, sufficient to have raised the Earth’s temps by the observed amount.
As for advocating something sufficient to forestall calamity, I sure do.
June 22nd, 2009 at 1:29 pm
[...] Matthew Yglesias [...]
June 22nd, 2009 at 1:36 pm
My Lord! Yes I have no doubt that the climate bill in it’s present condition will cost very little. But that is only the thin edge of the wedge. Only an idiot would think that it would stay at that level. You’re living in Climate change fantasy land if you think this is the case.
Understand this: The final target for the Greenies has always been 1% of GDP which is about $500 per person per year (Or $2000 per year for every family of four). And if the Greenies can get more than that, they will.
The thing that amazes me about all of this is the fact that the Dems are so willing to be blamed for this tax; they know that it will become an albatross around their necks in every upcoming election for decades to come. The Republicans will beat them over the heads with it forever. So I have to assume that the companies which become rich through the new Cap&Tax program will pay back the Dems at election time. It always comes back to the money, it’s not really about saving the planet, is it.
June 22nd, 2009 at 2:20 pm
The Republicans will beat them over the heads with it forever.
Probably not that long. Just until Florida loses Miami Beach.
June 22nd, 2009 at 2:38 pm
Probably not that long. Just until Florida loses Miami Beach.
Statements like the above are the exact reason this movement will fail.
If anyone puts any stock in the models after none of them have predicted this current cooling trend, they are morons.
June 22nd, 2009 at 4:43 pm
Statements like the above are the exact reason this movement will fail.
If it were only a movement instead of science.
If anyone puts any stock in the models after none of them have predicted this current cooling trend, they are morons.
What a doofus. All the GCMs I know of have fluctuations in temps.
June 22nd, 2009 at 8:03 pm
[...] to believe that any effort to limit carbon emissions will cripple our economy. The numbers (via Matt Yglesias) tell a different [...]
June 22nd, 2009 at 9:45 pm
If it were only a movement instead of science.
It stopped being science a long time ago.
June 23rd, 2009 at 5:58 am
rE: Either way, a collapse of the currency is a far, far bigger problem with much more immediate risks within the US.
There is far, far less evidence for any sort of looming currency collapse than there is for global warming.
June 24th, 2009 at 9:53 am
Personally, I agree with Mr. Robertson.
A: China and India have already said that they aren’t going to cripple their economies by cab and trade, so what happened to GLOBAL WARMING. Australian news television on June 23, 2009 said that their congress will not pass a cap and trade law until they see other nations doing it so they aren’t just sending Australia’s economy down the sink.
June 26th, 2009 at 1:44 pm
[...] Office, which actually did a detailed analysis of the distributive consequences of Waxman-Markey, concluded that the bill would have a positive impact on the poor even if you ignore the benefits of averting catastrophic climate [...]