The Tax Increase of Cap and Trade

by Sal on March 11, 2009

in Politics

Barack Obama campaigned and still maintains that 95% of all Americans will receive a tax cut, and only the top 2% will receive a tax increase.  If one is talking about income taxes, this may be technically true, although the claim itself is somewhat dubious.  Leaving that discussion to another day, however, the sum of Obama’s policies outside of the income tax will lead to an effective massive tax increase on the American People by significantly driving up costs.  One of the biggest culprits of this enourmous tax increase is Cap and Trade.

Cap and Trade would create government-mandated limits on Carbon emissions in an attempt to “save the planet” from the Global Warming Hoax.  The government would force businesses and homes to pay for “the right to emit carbon (are they going to charge people for exhaling?), thus making a natural substance a commodity by which the Government benefits.  The carbon allotments would be set by the government, and if a business or family needed more, they would be forced to purchase it from another company (all with a tax going to the government).

Team O would have you believe it is a tax on business, but it is rather a tax on the consumer.  Business do not pay their own taxes, rather they factor it into the cost of goods sold.  Consumers would see the increase on virtually every item they purchase, from food, to fuel, to manufactured goods.  Based on analysis by the OMB, it is a regressive tax that would hit the lowest income brackets the hardest.

Business would be hit as well.  The U.S. already has the highest corporate tax in the world, and adding cap and trade to the business’ already high tax burden will cause some businesses to no longer be able to compete globally, causing many American companies to fail or experience great hardship.  Companies will be forced to shut down, lay people off, and move manufacturing operations that produce carbon offshore to companies that do not have severe climate restrictions.  Thus, the carbon emissions will move overseas and thereby accomplish nothing.  One proposed government solution will be for the government to implement severe trade restrictions on nations that do not have a similar policy.  However, this will likely lead to a trade war, which is exactly what we need to avoid in this time of severe economic recession.

Any way you slice it, cap-and-trade is a bad idea that is being enacted under the guise of the climate change hoax to simply fill the government with a greater share of the nation’s wealth.  Obama should abandon it and stick to focusing on the economy.  Then again, look how much damage he has done already.

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