Few things are as frightening as governments that don't want to be confused by the facts because their minds are made up.
So it is with U.S. President Barack Obama and most Democrats, who, determined to create a domestic carbon cap-and-trade market, which Canada will inevitably be forced to join, are rushing into this useless and discredited "tool" for addressing man-made climate change, like lemmings going over a cliff.
It's not as if we don't know what's going to happen.
Based on the experience of the world's largest carbon trading market -- Europe's Emissions Trading Scheme (ETS), created in January, 2005 -- we know exactly.
First, electricity prices paid by already hard-hit North American consumers are going to rise even higher and faster than they are now.
Second, giant energy utilities, hedge fund managers and speculators are going to make a fortune on the backs of ordinary taxpayers, from the moment the government puts a price on emitting carbon dioxide.
Third, emissions by major industries -- which cap-and-trade is supposed to reduce -- will continue to rise under normal economic conditions, as they did in the ETS from 2005 to 2007.
(Preliminary data from the European Union released yesterday shows 2008 emissions dropped, but that was mainly due to the global recession, since the less demand there is for goods and services, the less energy it takes to produce them.)
Power up
Moody's Investors Service predicts U.S. electricity rates will rise up to 30% due to cap-and-trade alone, and "the vast majority" of that will be paid by ordinary citizens.
By contrast, large industrial emitters will pass along cost hikes to consumers, plus win favourable concessions from government bureaucrats, desperate to do the bidding of their political masters by getting the system up and running quickly, no matter how flawed.
That's what happened in Europe. It's why the ETS is a fiasco.
The myth about cap-and-trade is that it pits environmentalists and "green" politicians against big business, using market forces to reduce carbon dioxide emissions. This is nonsense.
In fact, all three become allies in assaulting the wallets of ordinary citizens.
As Democratic Rep. John Dingell, of Michigan told CNN last month: "I attended a recent meeting of an organization interested in (climate change legislation) and guess who it was? It was a bunch of good-hearted Wall Streeters ... getting ready to cut a fat hog."
Added Democratic Sen. Maria Cantwell of Washington: "Starting with Enron and now the current financial meltdown, energy markets have been a target-rich environment for (undeserved profits) ... We don't need to solve our carbon problems by creating another fiscal crisis because we have a trading platform that has lots of holes and ends up being exploited."
Supporters
Not only was Enron an early supporter of cap-and-trade, so are many firms involved in the ongoing global financial meltdown, including AIG, which has received $173 billion in federal bailouts so far; Morgan Stanley ($25 billion); JP Morgan Chase & Co. ($25 billion); Merrill Lynch ($10 billion) and Goldman Sachs, which got a chunk of the AIG bailout because of its financial relationship with it.
As Republican Rep. Greg Walden of Oregon observed: "This is a disaster in the making. If you like the bubbles of the technology market and the housing market, I predict you'll love the bubble that will come from the cap-and-trade market." Indeed.
Obama's disaster in the making
Hybrid Mode
