>>Cap and Trade in Practice. What it will mean to Americans too.
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Cap & Trade is a scheme to transfer wealth from the richer nations to the developing nations. China is considered a developing nation and so is India. As such they are permitted to pollute more that the United States or Europe. What irony, if Cap & Trade were to pass the United States would be in the position of having to borrow from China in order to pay China! But along with the tax dollars that would be taken from americans are jobs. Here is an example in the United Kingdom:
Corus, Europe’s second-largest steel producer, is shuttering a giant U.K. steelmaking plant at Redcar, cutting 1,700 jobs.
….in 2008 Corus had the second largest surplus of EU carbon allowances—7.5 million.
The EU is looking for ways to drive today’s depressed allowance price of about $21 apiece back up to former highs of about $50, so Corus has the potential for a $375 million windfall. By closing Redcar’s annual capacity of three million tons of steel, Corus will produce six million fewer tons of CO2. That means more carbon allowances, which could translate into about $300 million a year if credits hit $50. Corus is essentially being paid to lay off British workers.
Corus will also profit if it moves the production to India. As part of Kyoto, the United Nations created the Clean Development Mechanism to encourage Western companies to invest in developing-world factories. Participants are financially rewarded based on the amount of carbon they “save” with more efficient plants.
Corus was bought in 2007 by Tata, India’s largest steel company. The Indian steel industry is set to more than double production to some 124 million tons a year by 2011-2012. Were Corus to move production to a “clean” Indian factory, it could receive hundreds of millions of dollars annually from the Clean Development Fund. The kicker is that none of this results in fewer carbon emissions. A Corus plant in India might be more efficient by Indian standards, but it will be no more efficient than Redcar.
To summarize: Cap and trade is a scheme that would impose heavy carbon taxes and allowances on U.S. industries, which would then have an incentive to move overseas themselves, or to sell those allowances to overseas companies that could use them to become more competitive against U.S. companies. Like the 1,700 Brits at Redcar, American workers would be the big losers.
Are you still enamored of President Obama? Do you still think he will be the savior of the nation?
We can thank our lucky stars that President Bush refused to sign on to the Kyoto Agreements and that Copenhagen is turning out to be a bust too. But it isn’t because someone in the “richer” countries is showing some sanity. No, it is because China is refusing to sign on to allowing its country to be monitored by an outside source for compliance to any emissions agreement reached by the conference. BB