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Cap-and-Trade will do neither, says 1 expert

Being green is everything today. From consumer products to government policy, care for the environment is a powerful force guiding massive changes in our economy, our morals, and our way of life.

No other force has the power to change the basic tenets of our democracy the way care of the environment can. Public opinion polls show that about half of the American public put the environment at the top of their priority list.

A Harris poll in 2005 reported, “Three in four U.S. adults (74 percent) agree that ‘protecting the environment is so important that requirements and standards cannot be too high, and continuing environmental improvements must be made regardless of cost.’”

With this kind of mandate, regulators and marketers have forced upon us low-flow toilets, CFL light bulbs, and a host of other changes - all in the name of protecting the environment. Yet, all this pales in comparison to what is in store for our economy and our nation if the Obama Administration is successful in implementing its Cap-and-Trade program.

The Waxman/Markey Bill is set for House action in June. The 1,000-page bill is designed to reduce U.S. greenhouse gas emissions by taxing those industries that produce greenhouse
gasses.

Marty Irwin, Director of the Indiana Center for Coal Technology Research at Purdue, testified the legislation would not be good for Indiana’s rural economies.

“Let’s be clear, the Waxman/Markey Cap-and-Trade bill is neither; it does not cap CO2 emissions, in fact CO2 emissions will increase under this legislation,” Irwin explained. “And the only trading that will take place is trading Indiana manufacturing jobs for ones in China and India.”

Midwestern states such as Indiana and Ohio, which derive much of their energy from coal or fossil fuel, would be hit hard. Indiana Gov. Mitch Daniels estimates that electric rates in the Hoosier State would double due to Cap-and-Trade.

Job losses would be in the thousands in Indiana and in the hundreds of thousands nationwide. Cap-and-Trade would strike at the heart of the Midwest: manufacturing and agriculture.
Ohio Congressman Bob Latta said rural communities would be especially hard hit. A sharp jump in energy costs would force manufacturing to move elsewhere, and higher energy costs would increase the cost of many farm materials. He also pointed out that that loss of rural jobs would hurt many farm families who depend on those jobs for off-farm income.

Critics of the idea say the only winners under Cap-and-Trade are East Coast and West Coast states where most power is generated by hydro or nuclear sources. These states would see no change in their energy costs. Critics also claim the environment would not be improved under this scheme.

The bill has several glaring inconsistencies. While penalizing coal and oil, it provides incentives for renewable energy sources such as wind and solar. Ethanol is not included as a renewable energy source, but rather penalized with additional restrictions. The bill purports to reduce greenhouse gas emissions, yet the only greenhouse gas-free energy source - nuclear - is not even mentioned in the legislation.

As I have said before, we need an energy policy that makes sense, that provides real environmental benefits while not crippling our economy, and that provides for growth and opportunity in the future.

We must have an energy policy that is participatory by the market, by business, and by individual consumers.

Heavy-handed government mandates or draconian taxation plans are not good for our nation or our environment.

There will be a cost to cleaning up our environment and protecting it, but that cost must be manageable, fair, and balanced. It is time the White House and Congress stop playing political games with energy and get serious about a bi-partisan approach.

The views and opinions expressed in this column are those of the author and not necessarily those of Farm World. Readers with questions or comments for Gary Truitt may write to him in care of this publication.

6/3/2009