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Author Topic: Cap & Trade
G2
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The global warming tax, aka then Waxman-Markey Bill, 10 things to be aware of:
quote:

1. Cap and Trade Is a Massive Energy Tax

2. It Will Not Make a Substantive Impact on the Environment

3. It Will Kill Jobs

4. It Will Cause Electricity Bills and Gas Prices to Sharply Increase

5. It Will Outsource Manufacturing Jobs and Hurt Free Trade

6. It Will Make You Choose Between Energy, Groceries, Clothing, and Haircuts

7. It Will Be Highly Susceptible to Fraud and Corruption

8. It Will Hurt Senior Citizens, the Poor, and the Unemployed the Worst

9. It Will Cost American Families Over $3,000 a Year

10. President Obama Admitted "Electricity Rates Would Necessarily Skyrocket" Under a Cap-and-Trade Program (January 2008)

So called "pollution permits" will be handed out as subsidies, consequently debt is driven up, interest rates increase, and businesses (especially small businesses) will reduce investment, resulting in a more costly bill. Real GDP losses are estimated at $9.6 trillion.

Everyone is going to take a beating under this legislation. It will raise electricity rates 90% after adjusting for inflation, gas prices 74%, natural gas prices 55%, and an average family's annual energy bill by at least $1,500. Go check your electric bill and double it. How'd you like to pay that every month?

India and China aren't going along so it will be even cheaper and more attractive than it is now to move manufacturing jobs to those countries. It is estimated that 1,105,000 jobs will be lost as a result of this bill.

All this for what? This bill may *at best* result in 0.2 degree drop in temperature by the end of the century. That's the best case scenario, two tenths of a degree in the next 100 years. The reality is it will be less than the optimistic estimate. In other words, we get nothing really.

Given all that, why do it? The New York Times tells us that cap and trade "is almost perfectly designed for the buying and selling of political support through the granting of valuable emissions permits to favor specific industries and even specific congressional districts". Now we see the real reason for this.

[ May 21, 2009, 08:11 AM: Message edited by: G2 ]

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Colin JM0397
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The thought behind all this is there is more going on than meets the eye.

As much as it sucks for all of us involved, we do have a finite amount of resources, space, and the environment can only handle so much abuse. Industrial development needs to be curtailed and brought into - as much as it makes me shudder to use the watermelon (green outside, red all the way through) term - sustainable development.

For India and China to bring their populace up to the same standard of living we enjoy in the US, it would take, on the low end of estimates, 5x the natural resources that are even available across the entire planet.

I am pissed our leaders fear having frank discussions with us regular folks about such issues, but that's they way I see it. They think we're too ignorant to "get it", so they just lie to us about the reasons. That is my largest complaint against the government – they are constantly blowing smoke up our collective arses.

IMO it is time we take a pragmatic look at our place in the planet, not just in our country. This is not to say I want to squash national sovereignty or any of that garbage. But we in the US have a chance to be the leaders we claim to be.

You night not like the Greens, the former Marxists masquerading as greens, the "whacko environmentalists", but there is an obvious point that cannot be argued at play here: planet-wide growth and industry is nearing the point of outstripping our natural resources, and global pollution is in danger of tipping us too far into a toxic environment.

IMO we need to reign things in, and there are some costs associated with that - some very, very steep costs. We're talking a real reductions in consumption, energy usage, space usage, etc. Done smartly over time, it is manageable... Sadly, long term change doesn't fit too well into 2,4, and 6 year election cycles.

Nevertheless, the populace can drive this. It is time to choose. Do you want cheap gas, cheap food, cheap transportation today, or do you want to a viable environment in 100 years? The two things do not go together.

We have "the Pacific plastic island" that's larger than Texas. We have the Gulf of Mexico dead zone that's larger than New Jersey - from farm runoff into the Mississippi river...

Screw the global warming/cooling - I'm seeing much bigger things to worry about these days.

Maybe I have it all wrong and this is just a dog and pony show... But these people (government types) are not idiots. They might be power hungry jackasses, but they are not idiots. They know the cap and trade will have negligible effects on warming.

[ May 21, 2009, 09:57 AM: Message edited by: Colin JM0397 ]

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G2
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quote:
Originally posted by Colin JM0397:
It is time to choose. Do you want cheap gas, food, transportation, today, or a viable environment in 100 years?

That is a false dichotomy.

quote:
Originally posted by Colin JM0397:
Maybe I have it all wrong and this is just a dog and pony show... But these people (government types) are not idiots. They might be power hungry jackasses, but they are not idiots. They know the cap and trade will have negiligable effects on warming.

What's your theory on why they're doing it?
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The Drake
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Nobody's energy bill is going to go up by $100 per month. At best you can say that the energy costs are embedded in goods and services - when AT&T has to pay more for their energy, it gets passed on to their customers as higher rates.

You also forgot:

11. It Will Reduce Dependence on Foreign-Made Fossil Fuels With Volatile Pricing and Supply.

I do share the concern about political manipulation.

Kind of funny that US Steel, Mittal Steel, Alcoa, and the Steelworkers Union all support the bill if the result will be to push all jobs overseas, don't you think?

committee website

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Colin JM0397
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They think we're idiots, plain and simple.
Often times I have to agree with that sentiment.

Nevertheless, I do have faith in average folks to make smart decisions IF and WHEN the information flows freely. While information on such things is available to those taking the time to look, it's not the way the MSM does things.

Kind of a catch 22 from my point of view. Kind of like a parent being pissed off at their fat kid... Well, you fed him to make him fat.

-----

False in what way? Do you want to tell those billions of Chinese and Indians chomping at the middle class bit that, while we in the US enjoy our 2.5 cars, 3 plasma screen TV's, and eating out often, they need to hold steady where they are?

What other way to scale back - or at least hold steady - on overall consumption than to lead by example. It is, after all, the western idea of middle class they seem to be aspiring to. Perhaps we need to shift the reality and perception of what living in a developed nation means.

Granted, I haven't a clue how to do this other than start in my own home. Scaling back and doing things smaller does go against the "I got mine" way we've turned to in the US.

IMO, this is one of the benefits to the global recession. It is making us slow down and take stock of what is really important - ie ditching the wasteful crap we don't need.

Buy into my tin hat ways or not - but I'm of the opinion that the recession has been engineered with such ideas in mind because average folks would not willingly scale back when things are booming.

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G2
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quote:
Originally posted by The Drake:
Nobody's energy bill is going to go up by $100 per month. At best you can say that the energy costs are embedded in goods and services - when AT&T has to pay more for their energy, it gets passed on to their customers as higher rates.

Everyone, inlcuding Obams says it will go up "sharply". Here's what's happening:

quote:
  • The typical family of four will see its direct energy costs rise by over $1,500 per year.
  • Pain at the electric meter will cause consumers to reduce electricity consumption by 36 percent. Even with this cutback, the electric bill for a family of four will be $754 more that year and $12,200 more in total from 2012 to 2035.
  • The higher gasoline prices will have forced households to cut consumption by 15 percent, but a family of four will still pay $596 more that year and $7,500 more between 2012 and 2035.
  • In total, for the years 2012-2035, a family of four will see its direct energy costs rise by $22,800. These inflation-adjusted numbers do not include the indirect energy costs consumers will pay as producers are forced to raise the price of their products to reflect the higher costs of production. Nor does the $22,800 include the higher expenditure for such things as more energy-efficient cars and appliances or the disutility of driving smaller, less safe vehicles or the discomfort of using less heating and cooling.

That's direct, out of pocket costs. Consumer prices will rise costing everyone more as a result as well. For many people, $100 a month is a lot and that's just to start. Everything will cost more, everything. Over a million jobs will evaporate.


quote:
Originally posted by The Drake:
You also forgot:

11. It Will Reduce Dependence on Foreign-Made Fossil Fuels With Volatile Pricing and Supply.

No it won't.

quote:
Originally posted by The Drake:
I do share the concern about political manipulation.

Kind of funny that US Steel, Mittal Steel, Alcoa, and the Steelworkers Union all support the bill if the result will be to push all jobs overseas, don't you think?

committee website

Not at all, the reason they support it is obvious. In those two lines, you sum up exactly why they would be for it. Somebody's going to get paid off ...
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G2
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quote:
Originally posted by Colin JM0397:
TFalse in what way? Do you want to tell those billions of Chinese and Indians chomping at the middle class bit that, while we in the US enjoy our 2.5 cars, 3 plasma screen TV's, and eating out often, they need to hold steady where they are?

False in that those are the only choices. We can have both or even something altogether different. You present a very limited subset of the possibilities.
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The Drake
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quote:
Originally posted by G2:

11. It Will Reduce Dependence on Foreign-Made Fossil Fuels With Volatile Pricing and Supply.[/qb]

No it won't.
[/quote]

Care to explain why? You yourself quoted assertions that people will cut down on fuel and power - thus reducing the amount of total purchases. Not to mention that alternative energy will make up a greater share of the remaining energy purchases.

As for your assertions of cost, I assume they are coming from the MIT study, although you yourself are probably unaware of that because the conservative blogs aren't much good at sourcing their data.

quote:
To back up the claim, their staff pointed us to an M.I.T. report that says a similar a cap-and-trade proposal (the administration has not yet detailed their own version) would raise $366 billion per year. If you divide that by the 117 million households in the United States, you find it would cost each household $3,128, they said.

But is it that simple? Can you just assume consumers would be out $366 billion since that's how much the program would raise from fuel companies?

No.

"It's just wrong," said John Reilly, an energy, environmental and agricultural economist at M.I.T. and one of the authors of the report. "It's wrong in so many ways it's hard to begin."

Not only is it wrong, but he told the House Republicans it was wrong when they asked him.

"Someone from the House Republicans had called me (March 20) and asked about this," Reilly said. "I had explained why the estimate they had was probably incorrect and what they should do to correct it, but I think this wrong number was already floating around by that time."

quote:
The report did include an estimate of the net cost to individuals, called the "welfare" cost. It would be $30.89 per person in 2015, or $79 per family if you use the same average household size the Republicans used of 2.56 people.

The cost would grow over time as the program ramps up, but the average annual cost over time in today's dollars — that is, the "average annual net present value cost" — is still just $85 per person, Reilly said. That would be $215.05 per household.

Uh oh, there goes your soundbite! Not really as scary now, is it?
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G2
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quote:
Originally posted by The Drake:
quote:
Originally posted by G2:

11. It Will Reduce Dependence on Foreign-Made Fossil Fuels With Volatile Pricing and Supply.

No it won't.

Care to explain why? You yourself quoted assertions that people will cut down on fuel and power - thus reducing the amount of total purchases. Not to mention that alternative energy will make up a greater share of the remaining energy purchases. [/QB][/QUOTE]Fuel is a global commodity and the demand for that commodity is increasing. All the Western countries along with China and India need more and more. The US cutting electricity and fuel consumption by 36 and 15 percent will result in those decreases being picked up by the other countries and demand will continue to grow. There might be a slight downward blip, maybe, it could happen. But demand from all the other corners of the globe will more than compensate for that.

quote:
Originally posted by The Drake:
As for your assertions of cost, I assume they are coming from the MIT study, although you yourself are probably unaware of that because the conservative blogs aren't much good at sourcing their data.

You assume incorrectly. Uh oh, there goes your soundbite! Want to try it again?
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IrishTD
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@Colin:

US per capita consumption has been fairly flat since about 1990 (source: DoE link)

@Drake:
quote:
Kind of funny that US Steel, Mittal Steel, Alcoa, and the Steelworkers Union all support the bill if the result will be to push all jobs overseas, don't you think?
Not really. As G2 alluded to political manipulation is happening. These companies don't want to pay for an initial permit, hence why they are on board with it. If they opposed cap-and-trade, they'd have to pay for the initial permits. As with most things, just follow the money.
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Colin JM0397
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That’s good news. However, I'm talking about a lot more than energy: Food, materiel, crop land, etc.
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flydye45
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I've been thinking of claiming a plant and just selling my credits on the market. Don't turn it on. Just live off the pollution blackmail, the planetary indulgences.

Sigh. First I need a plant. Maybe Obama can at least put up a TARP for me to start.

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Kuato
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doesn't work that way, fly.

every green MW is electronic book-entered as it enters the transmission grid (where it is traded/sold).

You have to produce a MW (greenly) in order to have exactly one Tax Credit for sale on the electronic platform or OTC transaction.

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Kuato
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G2-

When the MW are being produced greenly, and the utilities are forced to pay if they produce a MW "dirtily" why are you supposing that they will continue to produce their energy the old way? Why wouldn't they convert?

The tax credits can be bought by anyone- Pepsi and Dupont are some of the nation's biggest buyers.

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G2
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quote:
Originally posted by Kuato:
G2-

When the MW are being produced greenly, and the utilities are forced to pay if they produce a MW "dirtily" why are you supposing that they will continue to produce their energy the old way? Why wouldn't they convert?

They will only convert when the tax penalty makes the "green" energy cheaper. It will have to include the cost of build out of the new infrastructure to handle it as well (windmills, solar panels and all the transmission lines out to the new generators). That's not free; I know some make the case that it is but it's not. In fact, it will be very expensive. It will also take time, years most likely, to build up enough to go to 100% "green" energy.

So the tax penalty will have to be enough to offset all those costs and when it gets to that point, then they will begin the build out. Why would they convert before that?

The rest of the world will stay with oil and gas, truly cheap energy that already has supported infrastructure. No doubt China will enjoy it when their economy eclipses the US economy and the yuan becomes the standard of trade. All brought to you under the guise of "clean energy".

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The Drake
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quote:
Originally posted by G2:
Fuel is a global commodity and the demand for that commodity is increasing. All the Western countries along with China and India need more and more. The US cutting electricity and fuel consumption by 36 and 15 percent will result in those decreases being picked up by the other countries and demand will continue to grow. There might be a slight downward blip, maybe, it could happen. But demand from all the other corners of the globe will more than compensate for that.

I think you need to read more carefully. My statement was that it would reduce dependence, not reduce pricing. On the contrary, pricing will clearly continue to rise just as you have suggested. To make it more clear, without a dependence on foreign oil, we'd be able to tell the entire middle east to go screw itself just like we can today with Africa.

quote:
You assume incorrectly. Uh oh, there goes your soundbite! Want to try it again?
Wow, most normal people would quote the source of the data they are using. If not the MIT study that most of the Congressmen are misusing, then can you please tell me which paper from which crazed think tank you are using for your data to quantify this mythical $3000?
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Kuato
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quote:
Originally posted by G2:
quote:
Originally posted by Kuato:
G2-

When the MW are being produced greenly, and the utilities are forced to pay if they produce a MW "dirtily" why are you supposing that they will continue to produce their energy the old way? Why wouldn't they convert?

Why would they convert before that?

The rest of the world will stay with oil and gas, truly cheap energy that already has supported infrastructure. No doubt China will enjoy it when their economy eclipses the US economy and the yuan becomes the standard of trade. All brought to you under the guise of "clean energy".

G2-

Renewable energy is cheaper now. What does a wind generator pay for After Pay Out on the machinery? Why not make those terms long and low interest? What does a solar plant? Or Waste To Energy, which pays nothing for the fuel while the coal generators shell out 30% or more to pay for the coal?

The reason renewables appear to be not be profitable at this point is because of the way the numbers are calculated- 99% of renewable facilities are utility owned and utilize an Avoided Cost agreement- this is an agreement that removes the amount paid to the renewable generator (which is owned -or actually the energy is owned- by the utility, so they don't care) so that the profit is removed (that's what they mean, avoided cost means the cost after the profit is removed).

I think I've explained this before, and maybe even to you, so why am I doing it again? How many renewable PPAs would you like me to send to you?

[ May 22, 2009, 10:10 AM: Message edited by: Kuato ]

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