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Letter to Congress on Waxman-Markey

vincentgioiaCongress, if you won't read Waxman-Markey (aka American Clean Energy and Security Act ) before voting, at least read this

Clear thinking people owe a debt of gratitude to authors Stephen Spruiell & Kevin Williamson who wrote an article for National Review that outlined no less than 50 outrageous features of the Waxman-Markey climate bill, also known as the American Clean Energy and Security Act. Some refer to the bill by the acronym "ACES" which is not only correct but also prescient; ACES is the "Aces and Eights" dead man's hand for America.

Like most legislation passed by the House of Representatives ACES was not read before it was voted upon. Speaker Nancy Pelosi saw to it that there was no time for those who might have wanted to understand what was in the bill had time to digest it. Even the author Waxman famously said in answer to a question about the bill "You don't expect me to know everything in this bill, do you?"

However if one takes time to read the over 1,000 pages of this legislation you will understand that it will not reduce greenhouse-gas emissions and relies upon the concept of carbon offsets, "which can be manufactured out of thin air and political imagination." By use of so-called carbon credits, it will eliminate most of the demands that the legislation puts on industry but will nonetheless increase prices consumers pay for every product that requires energy for its manufacture - which, of course, is everything. Waxman-Markey represents the worst abuse of the public trust and even worse in cost than the stimulus and the bailouts put together.

As Spruiell and Williamson wrote:

"Waxman-Markey creates a permanent new regime in which environmental romanticism and corporate welfare are mixed together to form political poison. From comic bureaucratic power grabs (check out the section of the bill on candelabras) to the creation of new welfare programs for Democratic constituencies to, above all, massive giveaways for every financial, industrial, and political lobby imaginable, this bill would permanently deform American politics and economic life."

"ACES" has four major objectives: giveaways to special-interests, regulatory mandates having nothing to do with climate change, and a wish list of left wing ideology. Every knife in the heart of American independence cannot be cataloged in a short summary but as Spruiell and Williamson identified here are some of the 50 most outrageous provisions that would change our lives in America forever.

1.Eighty-five percent of the carbon permits will not be sold at auction - they will be given away for free to utility companies, petroleum interests, refineries, and an array of politically connected businesses, however higher costs are in our future. This is the reason big business supports cap-and-trade.

2. Wall Street investment bankers whose money got Obama elected will be enriched, For example: Goldman Sachs is heavily invested in carbon-offset development and carbon permissions. According to CNN:

"Less than two weeks after the investment bank announced it would be laying off 10 percent of its staff, ***Goldman Sachs confirmed that it has taken a minority stake in Utah-based carbon offset project developer Blue Source LLC. . . . "Interest in the pre-compliance carbon market in the U.S. is growing rapidly," said Leslie Biddle, Head of Commodity Sales at Goldman, "and we are excited to be able to offer our clients immediate access to a diverse selection of emission reductions to manage their carbon risk."

3. The legislation includes corporate subsidies and special set-asides for politically connected industries, a new corporate interest group, USCAP, the United States Climate Action Partnership, was formed. This group is largely responsible for the fact that carbon permits are being given away like rather than auctioned. The Canada Free Press listed the following participants of this group who will be benefited:

Alcoa, American International Group (AIG) which withdrew after accepting government bailout money, Boston Scientific Corporation, BP America Inc., Caterpillar Inc., Chrysler LLC (which continues to lobby with taxpayer dollars), ConocoPhillips, Deere & Company, The Dow Chemical Company, Duke Energy, DuPont, Environmental Defense, Exelon Corporation, Ford Motor Company, FPL Group, Inc., General Electric, General Motors Corp. (now owned by the Obama administration), Johnson & Johnson, Marsh, Inc., National Wildlife Federation, Natural Resources Defense Council, The Nature Conservancy, NRG Energy, Inc., Pepsico, Pew Center on Global Climate Change, PG&E Corporation, PNM Resources, Rio Tinto, Shell, Siemens Corporation, World Resources Institute, Xerox Corporation.

Major recipients of this largesse in the form of carbon permits are the electric utilities such as those represented by the Edison Electric Institute. Together with the coal and steel companies, the utilities are positioned to receive a huge portion of the carbon permits have become among the nation's highest-spending lobbies who work to ensure that their interests are served by cap-and-trade.

4. Waxman-Markey will also create "offsets" with the result that nearly all of the bill's carbon-reduction targets can be met with offsets alone through 2050, meaning decades before any actual reduction of greenhouse gases is required. That means huge new expenses for small businesses and consumers in return for basically zero environmental improvement.

If you wish, you can also earn an offset that can be sold. Buy a farm and profit through such methods as, "improved manure management," "reduced tillage/no-tillage," or "afforestation of marginal farmlands." What this means plant some trees around the house and claim some extra credits on the land.

5. Because the cap-and-trade regime will disadvantage domestic oil refineries vis-à-vis foreign competitors, Waxman-Markey will buy them off with free permits - 2 percent of the national total will go to domestic refineries, at no cost.6. Again, to enlist more support, Agribusiness is exempted from cap-and-trade controls but farmers will be given permits to sell and to profit from anyway.

7. Some in congress voted for the bill because it supposedly strips the EPA of its oversight role when it comes to managing the offsets associated with American farms. However this is specious reasoning because at the urging of Cargill and other big farm aggregates oversight will be entrusted to the USDA - known to be "basically a wholly owned subsidiary of the agriculture cartel, one of America's most rapacious special-interest groups, which already is stuffed with subsidies and sops."

8. Waxman-Markey protects the discredited ethanol industry by directing the EPA to ignore the real environmental impact of ethanol and other biofuels. The huge subsidies given on the farm lobby through the ethanol program that encourages farmers to clear forest land to plant corn is preserved notwithstanding that ethanol is a net environmental loss since the use of ethanol does nothing to offset carbon "pollution." The EPA will be forbidden to change the ethanol program for a minimum of a five years "study" required before a ruling on whether ethanol should be treated the same as any other fuel, and the EPA, USDA, and Congress all must agree to act beforehand.

9. How about this one; farmers will be rewarded for such things as "no till" planting, in which farmers forgo plowing and plant seeds directly into the soil. Two peer-reviewed scientific papers suggest that no-till either does nothing to decrease carbon dioxide or actually increases the level of greenhouse-gas emissions by upping emissions of nitrous oxide - a much more powerful greenhouse gas. Of course weed control will be more difficult the market for herbicides such as Monsanto's RoundUp will be increased and guess who is spending millions lobbying for no-till?

10. Waxman-Markey will give the Obama administration broad new powers to enact tariffs on imports from jurisdictions that have not enacted similar legislation. This gives Obama an opportunity to develop politically driven trade protectionism and retaliatory measures. As the New York Times wrote:

"A House committee working on sweeping energy legislation seems determined to make sure that the United States will tax China and other carbon polluters, potentially disrupting an already-sensitive climate change debate in Congress. The Ways and Means Committee's proposed bill language would virtually require that the president impose an import tariff on any country that fails to clamp down on greenhouse gas emissions. Directed primarily at China, the United States' biggest manufacturing competitor, the provisions aim to protect cement, steel and other energy-intensive industries that expect to face higher costs under a federal emissions cap."

11. Big Labor. A huge supporter of democrats and Obama, will benefit hugely. Projects receiving grants and financing under Waxman-Markey provisions will be required to implement Davis-Bacon union-wage rules, making it hard for non-union firms to compete - and ensuring that these "investments" pay out inflated union wages. And it's not just the big research-and-development contracts, since Waxman-Markey forces union-wage rules all the way down to the "plumbing-repair and light-bulb-changing level."

12. The renewable electricity standard in the bill requires utilities to supply 20 percent of their power from renewable energy sources (or "increased efficiency") by 2020. The bill would create a system of renewable electricity credits similar to the carbon offsets mentioned above - utilities that cannot meet the standard could purchase credits from other utilities but one way or another the cost will be passed along to us.

13. The renewable standard excludes sources of power like nuclear and coal gasification even though these sources are cleaner than traditional coal-burning plants. "Qualified hydropower" is also narrowly defined to exclude hydropower from Canada. Why is that if not to protect profits of domestic industries at the cost to the public?

14. Waxman-Markey calls for the establishment of a Carbon Storage Research Corporation (CSRC) to direct $1 billion annually into the development of carbon-capture technologies. The CSRC would be funded via assessments on utility companies. This is another charge that will be added to electricity bills.

15. Carbon capture will require a whole new bureaucracy and new regulations. The bill requires the EPA to create a permitting process for geologic sequestration (burying captured carbon emissions in the ground), regulations to keep the buried carbon from escaping into the air, and regulations to keep it from escaping into the water supply, much of the technology required for this does not yet exist.

16. We know about the replacement of incandescent light bulbs with compact fluorescents already mandate, but the new bill regulates every light fixture under the sun. There are rules governing fluorescent lamps, incandescent lamps, intermediate base lamps, candelabra base lamps, outdoor luminaries, portable light fixtures. The government actually started down this road by regulating light bulbs in the 2005 energy bill. This bill tightens the regulations, which means the unintended consequences produced by the 2005 bill - use of more expensive light bulbs that burn out quicker - will get worse.17. Waxman-Markey will also dictate what appliances we can use. Clothes washers and dishwashers, portable electric spas, showerheads, faucets, televisions - all these and more are covered specifically in the bill. How do you feel about the government telling you what appliances are good for you or not?

18. Appliances will be required to come with "carbon output" labels, and retailers will get bonus payments for marketing those that are certified "best-in-class." The bill sets up a payment schedule to reward the manufacturers of these "best-in-class" products: $75 for each dishwasher, $250 for each clothes washer, and so on. It's best to buy that appliance of your dreams now because soon you will be told what you should be dreaming about

19. Homes are not exempt from government regulation because under Waxman-Markey the EPA is required to establish environmental standards for residences, meaning a "federally dictated one-size-fits-all policy for greening every home in America." New houses in particular will be affected by these regulations mandated by "ACES." Of course the house of your dream will have to be green, may not include all you want and will cost more - but, hey, you will be helping to save the planet from a nonexistent threat.

20. All commercial buildings also would be governed by a "national energy efficiency building code" that would require 50 percent reductions in energy use in all buildings by 2018, followed by 5 percent reductions in energy use every three years after that through 2030. Everyone knows these changes will be costly, but Waxman-Markey supporters argue that they will pay for themselves through lower energy bills which is nonsense because energy costs will also be rising. Businesses and homeowners will pay twice - once to retrofit or build and again through the energy bill.

21. EPA is given broad power to regulate greenhouse-gas emissions from mobile sources such as cars, trucks, buses, dirt bikes, snowmobiles, boats, planes, and trains - nothing is beyond the control of government.

22. Even non-mobile sources are to be regulated by the EPA as well. The Supreme Court cleared the way for the EPA to regulate greenhouse-gas emissions by declaring carbon dioxide to be a pollutant. Just think about it, you are polluting the air with every breadth you exhale. There is no doubt President Obama will move forward with this even if Congress fails to pass the cap-and-trade bill. He has already announced a strict national fuel-efficiency standard for cars, and the implications for other sources of greenhouse-gas emissions are not good.

23. Waxman-Markey requires the EPA to establish a federal greenhouse-gas registry. Businesses would be required to collect and submit data on their emissions to the EPA, creating yet another compliance cost for them to pass on to their customers.

24. The bill does away with the 10th Amendment by prohibiting states from creating their own cap-and-trade programs. Nearly half of all U.S. states have already taken some sort of action to cap greenhouse-gas emissions by forming regional compacts and implementing their own emission standards. Understandably, these states support a federal cap so that they are not at an economic disadvantage to states that do not cap emissions. If these states want to destroy their own economies in the pursuit of green goals but states that don't see any reason to do so should not be forced to share in their in that destruction.

25. The government having acquired automobile companies will be forcing the public into green electric put putts. Utility companies are directed by ACES to start laying the groundwork for a glorious future in which everyone drives a plug-in car. The legislation directs them to start planning for the deployment of electrical charging stations along roadways, in parking garages, and at gas stations, as well as "such other elements as the State determines necessary to support plug-in electric drive vehicles."

26. Waxman-Markey requires the Secretary of Energy to establish a large-scale vehicle electrification program and to provide "such sums as may be necessary" for the manufacture of plug-in electric-drive vehicles, including another $25 billion for "advanced technology vehicle" loans. The bill directs the Secretary of Energy to promulgate regulations requiring that each automaker's fleet be comprised of a minimum percentage of vehicles that run on ethanol or biodiesel. Forget about that SUV or other unapproved vehicle you may want, the government will tell you what you want.

27. You may recall that Congress passed (and Obama signed) a "cash for clunkers" program as part of the war appropriations bill this month. Under the program, you get a rebate for trading in a used car for one that gets slightly higher mileage. The Waxman-Markey bill takes this concept and applies it to appliances, electric motors - basically anything that can be traded in for a more energy-efficient version. These types of programs hugely fail cost-benefit analyses because more energy goes into the production of the new appliances than would have been used if the old ones had just run their course.

28. Democrats and Obama know that money alone won't make green mandates cost-competitive and that only carbon rationing can achieve that; that's why they are pushing a carbon-rationing bill.

29. Waxman-Markey includes $7.5 million to establish a National Bioenergy Partnership to promote biofuels. Economic barriers to the commercial viability of biofuel as an energy source have proven to be so insurmountable that even with all of the federal mandates and subsidies already thrown their way, the ethanol companies lined up with everyone else for a federal bailout when the financial crisis hit. "The last thing consumers need is another full-time, federally subsidized lobbying arm for that industry."

30. ACES (and eights) also takes care of Obama's most reliable constituencies; college administrators, will be given billions of dollars to play with through the creation of eight "Clean Energy Innovation Centers," university-based consortia charged with a mission to "leverage the expertise and resources of the university and private research communities, industry, venture capital, national laboratories, and other participants in energy innovation to support cross-disciplinary research and development in areas not being served by the private sector in order to develop and transfer innovative clean energy technologies into the marketplace."

31. Of course, another Obama constituency, the community-organizing political arm of the democrat Party - i.e., ACORN - is amply rewarded by Waxman-Markey for their heroic efforts of fraudulent elections of the past and the future. ACORN and the like will be eligible to receive billions in funding as the bill "authorizes the Secretary [of Energy] to make grants to community development organizations to provide financing to businesses and projects that improve energy efficiency." Federally subsidized "community organizers" will be paid $55 an hour to share their energy expertise with businesses.

32. Waxman-Markey also enables Obama "spread the wealth" by using the tax code to transfer wealth from people who pay taxes to people who don't, mainly from likely Republican voters to likely Obama voters. The bill "amends the Internal Revenue Code to allow certain low income taxpayers a refundable energy tax credit to compensate such taxpayers for reductions in their purchasing power, as identified and calculated by the Environmental Protection Agency (EPA), resulting from regulation of GHGs (greenhouse gases)." Not only will Waxman-Markey slip more redistribution into the tax code, it will establish a new monthly welfare check. It will create an "Energy Refund Program" that will "give low-income households a monthly cash energy refund equal to the estimated loss in purchasing power resulting from this Act." If all this wasn't bad enough, another new class of government dependents will be created by Waxman-Markey. Americans put out of work by Waxman-Markey will be eligible to participate in a program to distribute "climate change adjustment assistance to adversely affected workers."

33. With unemployment abounding, Waxman-Markey will create new jobs in government. The bill creates: a new United States Global Change Research Program, a National Climate Change Adaptation Program, a National Climate Service, Natural Resources Climate Change Adaptation Strategy office at the White House, and an International Climate Change Adaptation Program at the State Department; imagine the hundreds of thousands dependent on the government, and Democrats, for their livelihood - how do you think they will vote?

34. It's easy to see why many states support cap and trade legislation; it allows each state to set up a State Energy and Environment Development (SEED) account into which the federal government can deposit emission allowances. States can then sell these allowances and use the proceeds to support clean-energy programs. They must set aside a certain amount of the money to fund federal mandates, but they are given broad discretion to use the rest by making loans, grants, and other forms of support available to favored constituencies. Once again the 10th amendment is reduced by the federal government using the greed lure of money.

35. Waxman-Markey doesn't overlook the health care debate; it requires the Department of Health and Human Services to develop a "strategic action plan to assist health professionals in preparing for and responding to the impacts of climate change."

If legislators don't want to take the time to read the American Clean Energy and Security Act, I hope they at least have time to read these outrageous encroachments on our constitutional freedoms and liberty before they vote on this calamity again.

Vincent Gioia is a retired patent attorney living in Palm Desert, California. His articles may be read at www.vincentgioia.com and he may be contacted at This email address is being protected from spambots. You need JavaScript enabled to view it.

 

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