Quotes on Cap and Trade and Energy

Under my plan of a cap and trade system, electricity rates would necessarily skyrocket. . . . Because I’m capping greenhouse gases, coal power plants, natural gas—you name it—whatever the plants were, whatever the industry was, they would have to retrofit their operations. That will cost money. They will pass that money on to consumers.”

President Barack Obama, January 2008

So if somebody wants to build a coal-powered plant, they can. It’s just that it will bankrupt them because they’re going to be charged a huge sum for all that greenhouse gas that’s being emitted.

— President Barack Obama, January 2008

“Nobody in this country realizes that cap and trade is a tax, and it’s a great big one.”

Rep. John Dingell, April 24, 2009

Speaking on cap and trade, Rep. Rangel said, “Whether you call it a tax, everyone agrees that it’s going to increase the cost to the consumer.”

— Charlie Rangel, Chairman, House Ways and Means Committee, quoted in May 14, 2009 Congress Daily

“Under a cap-and-trade program, firms would not ultimately bear most of the costs of the allowances but instead would pass them along to their customers in the form of higher prices. Such price increases would stem from the restriction on emissions and would occur regardless of whether the government sold emission allowances or gave them away. Indeed, the price increases would be essential to the success of a cap-and-trade program because they would be the most important mechanism through which businesses and households would be encouraged to make investments and behavioral changes that reduced CO2 emissions.”

Peter R. Orszag, Former CBO Director, current White House OMB Director, April 24, 2008,

“The government could either raise $100 by selling allowances and then give that amount in cash to particular businesses and individuals, or it could simply give $100 worth of allowances to those businesses and individuals, who could immediately and easily transform the allowances into cash through the secondary market.”

Peter R. Orzag, Former CBO Director, current White House OMB Director, November 1, 2007

“If you didn’t auction the [CO2] permits, it would represent the largest corporate welfare program that has ever been enacted in the history of the United States. All of the evidence is that what would occur is that corporate profits would increase by approximately the value of the permits.”

Peter R. Orszag, White House OMB Director, March 2009

Although the direct economic effects of a cap-and-trade program described in the previous section would fall disproportionately on some industries, on some regions of the country, and on low-income households, the program’s ultimate economic effect would depend on policymakers’ decisions about how to allocate the revenues from the emission allowances.

. . .

Some of the effects of a CO2 cap would be similar to those of raising such taxes: The higher prices caused by the cap would reduce real wages and real returns on capital, which would be like raising marginal tax rates on those sources of income.

— Douglas W. Elmendorf, Director, Congressional Budget Office, Testimony on The Distribution of Revenues from a Cap-and-Trade Program for CO2 Emissions before the Committee on Finance United States Senate, May 7, 2009.

George Soros: Definitely. I think this is a great opportunity to finally deal with global warming and energy dependence. The US needs a cap and trade system with auctioning of licenses for emissions rights. I would use the revenues from these auctions to launch a new, environmentally friendly energy policy. That would be yet another federal program that could help us to overcome the current stagnation.

SPIEGEL: Your proposal would be dismissed on Wall Street as “big government.” Republicans might call it European-style “socialism.”

George Soros: That is exactly what we need now. I am against market fundamentalism. I think this propaganda that government involvement is always bad has been very successful—but also very harmful to our society.

Interview with George Soros in Spiegel Online

“We need more expensive gasoline to change consumer behavior,” Mr. Jackson said. Otherwise, Americans will continue to favor big vehicles, not matter what kind of fuel-economy standards the government imposes on auto makers. Four dollars a gallon, he added, “is a good start.”

Michael J. Jackson, AutoNation CEO

“Until the consumer is involved, we are not going to make progress” in reducing the amount of oil the U.S. consumes.”

Alan Mulally, Ford Motor Co. Chief Executive

“Coal is My Worst Nightmare.”

Secretary of Energy, Steven Chu, April 23, 2007, presentation at U.C. Berkeley

“Somehow we have to figure out how to boost the price of gasoline to the levels in Europe.”

Secretary of Energy, Steven Chu, September 2008

“What the American family does not want is to pay an increasing fraction of their budget, their precious dollars, for energy costs.”

Secretary of Energy, Steven Chu, January 12, 2009

“A cap and trade bill will likely increase the costs of electricity. . . . These costs will be passed on to the consumers. But the issue is, how does it actually…how do we interact in terms with the rest of the world? If other countries don’t impose a cost on carbon, then we would be at a disadvantage. . . . We should look at considering duties that would offset that cost.”

Secretary of Energy, Steven Chu, House Committee on Science on Technology, March 17, 2009

“You can revisit and ratchet down later,” Chu said, adding that he would “rather have a bill this year” — even a relatively weak one — than no climate legislation at all.

— Secretary of Energy, Steven Chu, speaking at Harvard University, quoted in Inside Energy, August 10, 2009

Markey, who introduced Chu at the Harvard speech and took questions with him after, said even if the relatively weak House bill becomes law, Congress will revisit its emission-reduction targets in the coming years.

“This won’t be the last time we will visit this between now and 2020, 2030, 2050,” Markey said.

— Rep. Edward Markey, speaking at Harvard University, quoted in Inside Energy, August 10, 2009

The biggest priority is softening the blow on our trade sensitive industries and our consumers. I just want you to know that, that’s the goal.”

— Sen. Boxer, July 17, 2009, Senate Environment and Public Works Committee Hearing

“We need to be a leader in the world but we don’t want to be a sucker. . . . And if we go too far with this, all we’re going to do is chase more jobs to China and India, where they’ve been putting up coal-fired plants every 10 minutes.”

Sen. McCaskill talking to talk radio host Mike Ferguson, July 2009

“We are calling upon Congress to vote against this bill [Waxman-Markey] . . . Despite President Obama’s assurance that he would enact strong, science-based legislation, we are now watching him put his full support behind a bill that chooses politics over science…”

Greenpeace, June 25, 2009

“I can’t give you a specific number today, in large part because the analysis upon which we would make that determination has not been completed. . . . I think it is fair to say there may be additional costs associated with a farming operation, but it is very difficult to quantify.”

— Secretary of Agriculture, Tom Vilsack, June 11, 2009, House Committee on Agriculture Hearing

“I believe the central parts of the [EPA] chart are that U.S. action alone will not impact world CO2 levels.”

EPA Administrator Lisa Jackson, July 7, 2009, Senate Environment and Public Works Committee Hearing

“It’s important that those who consume the products being made all around the world to the benefit of America — and it’s our own consumption activity that’s causing the emission of greenhouse gases, then quite frankly Americans need to pay for [Chinese greenhouse gas emissions].”

Commerce Secretary Gary Locke, July 2009, at the American Chamber of Commerce in Shanghai

When asked about cap and trade Warren Buffet said, “In the utility business, it’s going to be borne by customers. And it’s a tax like anything else.” He added that the “tax is probably going to be pretty regressive.”

Warren Buffett, Interview on CNBC, March 9, 2009

“…my rates will stay pretty steady in the early going. They’ll begin to go up when I begin to react in a costly cap-and-trade market or deploy carbon-capture and storage technology. Rates could go up as much as 30% to 50% to pay for all of that.”

AEP CEO Mike Morris, Interview with Forbes Magazine, June 17, 2009

Look, any cut in greenhouse gases is going to be expensive for American consumers, who are in no mood to bear additional costs.

Robert Reich, former Clinton Secretary of Labor, in an interview with Marketplace, October 16, 2009

The danger if Murkowski were to become law is [if EPA’s endangerment finding is not overturned] that there isn’t the immediate incentive to put a price on carbon,” said

— Sen. Mark Udall (D-Colo.), quoted in Environment and Energy Daily, June 8, 2010.

“The expensing of IDCs, like other oil and gas preferences the Administration proposes to repeal, distorts markets by encouraging more investment in the oil and gas industry than would occur under a neutral system. To the extent expensing encourages overproduction of oil and gas, it is detrimental to long-term energy security and is also inconsistent with the Administration’s policy of reducing carbon emissions and encouraging the use of renewable energy sources through a cap-and-trade program. “

— U.S. Department of the Treasury’s 2010 “Green Book” Budget Proposal

Addressing the questioner, Obama conceded, “None of that is going to help you this week, though. So, like I said, if you’re getting eight miles a gallon you may want to think about a trade-in.  You can get a great deal.  I promise you, GM or Ford or Chrysler, they’re going to be happy to give you a deal on something that gets you better gas mileage.” When he mentioned the need to boost fuel efficiency for cars and truck, Obama singled out some in the audience for applauding: Now, I notice some folks clapped, but I know some of these big guys, they’re all still driving their big SUVs.  You know, they got their big monster trucks and everything.  You’re one of them?  Well, now, here’s my point.  If you’re complaining about the price of gas and you’re only getting eight miles a gallon  — you may have a big family, but it’s probably not that big.  How many you have?  Ten kids, you say?  Ten kids? Well, you definitely need a hybrid van then.

President Obama, April 6, 2011

“By some estimates, the oil you recently discovered off the shores of Brazil could amount to twice the reserves we have in the United States. We want to work with you. We want to help with technology and support to develop these oil reserves safely, and when you’re ready to start selling, we want to be one of your best customers.”

President Obama during March 2011 visit to Brazil


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