CBO: Waxman-Markey Climate Bill to Cost Just $175 per Household
With Speaker Nancy Pelosi likely bringing climate change legislation to the House for a floor vote later this week, a newly-released report by the Congressional Budget Office found that the per-household cost of The American Clean Energy and Security Act was far lower than previously estimated costs.
According to the report, released late Friday afternoon, the annual cost of the Waxman-Markey climate change bill would be an estimated $175 per American household. In addition to the project low cost of Waxman-Markey, the CBO report also suggests the bill would achieve emissions reductions of approximately 17% below 1990 levels by 2020.
Authors of the report broke down projected costs (subscription req’d.) of the legislation by different economic demographics, with the lowest of the five income brackets seeing an average annual net benefit of about $40 in 2020 because of the different direct rebates and other payback provisions written into the legislation. The highest bracket can expect to see net costs of $245 per year.
Democrats respond positively, but environmental groups split over bill’s effectiveness
Democrats voiced varying levels of support for the bill, with many believing something is better than nothing, especially as the next round of UN climate talks is set to begin in Copenhagen later this year.
“This analysis underscores that this legislation is effective and affordable,” said Energy and Commerce Chairman Henry Waxman (D-Calif.), in a statement. “It sets America on a course of energy independence while taking significant steps to reduce dangerous global warming pollution.”
But many would-be supporters of the legislation are still not sold, arguing that the bill was watered-down with concessions to aid its passage. Broad-based environmental organizations like the Sierra Club are showing some internal divisions with respect to Waxman-Markey as some believe the bill is far too diluted to be an effective vehicle for substantive carbon reduction.
One particular point of contention in the current language the absence of any carbon-capping authority in the Environmental Protection Agency. Some argue that EPA must have the ability to enforce caps on power plants and other major greenhouse gas emitters. Josh Dorner, deputy director of communications for the Sierra Club said, “We think that to get where we need to go on global warming and to solve a whole bunch of other problems, that it’s fundamentally important that EPA retain the authority it has to go clean up these old coal plants,” said Dorner.
Republicans less enthused
Not surprisingly, Republicans were not particularly enthused about the report, complaining that the CBO report omitted several billions of dollars in direct and indirect costs. The GOP has said American households would pay between $770 and $1,380 more per year for energy and other consumer items.
A spokesman for House Minority Leader John A. Boehner (R-Ohio), told the Washington Post that the CBO analysts “got an unrealistically low number for cost per family because they didn’t factor in the millions of American jobs that will move overseas if the United States imposes this tax and our foreign competitors, like China and India, do not.”
Boehner has asserted that the bill would raise annual energy costs by $3,128 per household in 2015.
Ranking minority member of the House Ways and Means Committee also found issue with the report. “The CBO analysis makes clear that this is a new multi-billion dollar tax on every American family,” said Rep. Camp (R-Mich.) in a press release.
Here’s the hook that does have some political bite to it. Camp says that what would amount to a tax is in direct violation of the President Obama’s pledge that families making less than $250,000 would not pay higher taxes.
And for all intents and purposes, he’s right.