First, we have the Governor of our now solidly blue state calling for a $600 million annual tax increase in the form of new levies on the sale of cigarettes and alcohol products. It is hardly controversial to point out that these hundreds of millions are going to come right from those who can least afford them. And now the feds–also solidly blue–are about to get in on the soak the poor band wagon. What progressives want, and have wanted since the 1970s, are massive new energy taxes. (Can you say BTU tax?) It is certainly not controversial to point out that energy taxes fall heaviest on the poor. Well, the environmentalist left may get their way in the form of a new energy rationing scheme called cap and trade program. This new study from the Tax Foundation gives us a heads up on who will pay and how much. (Oh, we can here the progressive social engineers now—“The Tax Foundation is right wing, they’re market fundamentalists, they’re funded by big oil, they’re deniers and, oh yeah, their mother wears combat. Who among us can’t write the script?)
Here’s the abstract from the Tax Foundation Study.
Many U.S. lawmakers view cap and trade as a politically superior
non-tax approach to climate policy. However, cap and trade imposes
identical economic burdens on households to a similarly designed carbon
tax. Using the newly-released 2002 input-output accounts we present new
estimates of the distributional impact of a typical cap-and-trade
system by income, age, U.S. region and family type. In total,
households would face an annual burden of roughly $144.8 billion per
year with costs disproportionately borne by low-income households,
those under age 25 and over 75 years, those in Southern states, and
single parents with dependent children. Using RIMS II multipliers we
estimate the broader economic impact of cap and trade. Depending on how
the system is structured, cap and trade could reduce U.S. employment by
965,000 jobs, household earnings by $37.8 billion, and economic output
by $136 billion per year or roughly $1,145 per household. Lawmakers
weighing the costs and benefits of climate policy should be aware that
cap and trade would impose a significant and regressive annual burden
on U.S. households, and would not represent a “tax free” way to reduce
greenhouse gas emissions.