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June 26, 2009
Friends,
I’m writing you in a special Garrett Gazette to raise your awareness about the national energy tax proposed by House Democrats that will likely be voted on in the House of Representatives today. This national energy tax is certain to raise electricity prices, increase gasoline prices, and ship American jobs overseas.
If you drive a car, buy food or a product manufactured in America, or flip on a light switch, you’ll pay more under the Democrats’ national energy tax. Here’s what the longest-serving Democrat in the House, Rep. John Dingell (D-MI), had to say about the tax: “Nobody in this country realizes that cap and trade is a tax. And it’s a great big one.”
The National Energy Tax Will Cause Electricity Bills to “Skyrocket”
The national energy tax will increase electricity bills for every American and small business. President Obama even admitted that it would cause electricity rates to “necessarily skyrocket.” And Duke Energy, a major utility company that would receive free allowances under the Democrats’ plan, has already requested a rate hike of 13.5 percent in anticipation of the energy tax.
The National Energy Tax Will Cause Gasoline and Diesel Prices to Spike Further
Gasoline prices have spiked in recent weeks, yet the national energy tax will make gasoline and diesel even more expensive for families and small businesses. The Heritage Foundation estimates that it will raise inflation-adjusted gasoline prices by 58 percent. Not only is that troubling to middle-class families trying to make ends meet, but small businesses – such as America’s truck drivers who are responsible for transporting food and other products across the country – are especially vulnerable during an economic recession. In fact, Tommy Hodges, First Vice Chairman of the American Trucking Association, recently warned that the House Democrats’ national energy tax on America’s truck drivers will leave America’s truck drivers, exposed to dramatic and sudden fuel price spikes.
The National Energy Tax Will Cost American Jobs, Shipping Them Overseas According to a study by the National Black Chamber of Commerce, the Democrats’ national energy tax will cost 2.3 to 2.7 million jobs each year, even after the creation of new so-called “green” jobs. It will impose tough new requirements and increased costs on American manufacturers – higher costs that they won’t face overseas, in places like China, India, or Mexico. This will cost American jobs in two ways: either domestic manufacturers will move overseas directly, or American companies in energy-intensive industries will be driven out of business by overseas rivals that undercut their prices. These job losses, and their ripple effects throughout our economy, were excluded from an incomplete analysis recently completed by the Congressional Budget Office. The Brookings Institute recently released a report that confirmed a national energy tax would reduce economic growth, increase costs, and kill jobs. The following chart shows the projected job loss in every single region, with especially large job losses in areas of the country already hit hard by the recession:
Additionally, the national energy tax could reverse our chances for economic recovery as we are trying to climb out of this recession. Mother Jones warned that if the national energy tax “is signed into law, it will generate, almost as an afterthought, a new market for carbon derivatives. That market will be vast, complicated, and dauntingly difficult to monitor. And if Washington doesn’t get the rules right, it will be vulnerable to speculation and manipulation by the very same players who brought us the financial meltdown.”
Instead of supporting a tax that will kill jobs and increases energy costs for Americans, I am a proud sponsor of The American Energy Act. This legislation establishes an ‘‘American Renewable and Alternative Energy Trust Fund” in the Treasury consisting of the receipts from oil and natural gas leasing provided by the bill. Amounts in the Trust Fund would be available to carry out research and development programs created by of the Energy Policy Act of 2005, and the Energy Independence and Security Act of 2007, including: oil shale, tar sands, other strategic unconventional fuels and clean coal. This legislation also expands an existing energy investment tax credit for renewable energy equipment to include clean coal equipment, and repeals section 526 of the Energy Independence and Security Act of 2007 which bans Federal agencies from procuring fuels derived from alternative energy such as liquid coal, tar sands, and oil shale. Repealing this provision will help spur a market for liquid coal fuels and foster technological innovation.
The American Energy Act also allows the Secretary of Interior to enter into long term coal-to-liquid fuel purchase contracts (for periods of five, ten, fifteen or twenty years) and to enter into standby loan agreements with up to six qualifying coal-to-liquid projects, helping to further generate a market for such technology. It makes permanent the tax credit for the production of electricity derived from Indian coal and refined coal and contains a regulatory reform component which amends the Clean Air Act by stating that the term “air pollutant” does not include carbon dioxide and certain other greenhouse gases and shall not be used to regulate climate change. The bill also prohibits any consideration of the impacts of greenhouse gases on any species of fish or wildlife or plant, ensuring that the Endangered Species Act shall not be used to regulate climate change. This section denies the Environmental Protection Agency the ability to regulate carbon emissions, which would negatively affect the competitiveness of coal-fired power plants.
Today’s vote on the national energy tax will have consequences for every American. It is a bad deal for America. And the American people will remember how their Members of Congress vote.
Sincerely,
Scott Garrett
Member of Congress
