Obama Admin: Cap And Trade Could Cost Families $1,761 A Year

http://www.cbsnews.com/blogs/2009/09/15/taking_liberties/entry5314040.shtml

The Obama administration has privately concluded that a cap and trade
law would cost American taxpayers up to $200 billion a year, the
equivalent of hiking personal income taxes by about 15 percent.

A previously unreleased analysis prepared by the U.S. Department of
Treasury says the total in new taxes would be between $100 billion to
$200 billion a year. At the upper end of the administration's
estimate, the cost per American household would be an extra $1,761 a
year.

A second memorandum, which was prepared for Obama's transition team
after the November election, says this about climate change policies:
"Economic costs will likely be on the order of 1 percent of GDP,
making them equal in scale to all existing environmental regulation."

The documents (PDF) were obtained under the Freedom of Information Act
by the free-market Competitive Enterprise Institute and released on
Tuesday.

These disclosures will probably not aid the political prospects of the
Democrats' cap and trade bill. The House of Representatives approved
it by a remarkably narrow margin in June -- the bill would have failed
if only six House members had switched their votes to "no" -- and it
faces significant opposition in the Senate.

One reason the bill faces an uncertain future is concern about its
cost. House Republican Leader John Boehner has estimated the
additional tax bill would be at $366 billion a year, or $3,100 a year
per family. Democrats have pointed to estimates from MIT's John
Reilly, who put the cost at $800 a year per family, and noted that tax
credits to low income households could offset part of the bite. The
Heritage Foundation says that, by 2035, "the typical family of four
will see its direct energy costs rise by over $1,500 per year."

One difference is that while Heritage's numbers are talking about 26
years in the future, the Treasury Department's figures don't have a
time limit.

"Heritage is saying publicly what the administration is saying to
itself privately," says Christopher Horner, a senior fellow at the
Competitive Enterprise Institute who filed the FOIA request. "It's
nice to see they're not spinning each other behind closed doors."

"They're not telling you the cost -- they're not telling you the
benefit," says Horner, who wrote the Politically Incorrect Guide to
Global Warming. "If they don't tell you the cost, and they don't tell
you the benefit, what are they telling you? They're just talking about
global salvation."

The FOIA'd document written by Judson Jaffe, who joined the Treasury
Department's Office of Environment and Energy in January 2009, says:
"Given the administration's proposal to auction all emission
allowances, a cap-and-trade program could generate federal receipts on
the order of $100 to $200 billion annually." (Obviously, any final
cap-and-trade system may be different from what Obama had proposed,
and could yield higher or lower taxes.)

Because personal income tax revenues bring in around $1.37 trillion a
year, a $200 billion additional tax would be the equivalent of a 15
percent increase a year. A $100 billion additional tax would represent
a 7 or 8 percent increase a year.

One odd point: The document written by Jaffee includes this line: "It
will raise energy prices and impose annual costs on the order of
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX." The Treasury Department redacted
the rest of the sentence with a thick black line.

The Freedom of Information Act, of course, contains no
this-might-embarrass-the-president exemption. You'd hope the
presidential administration that boasts of being the "most open and
transparent in history" would be more forthcoming than this.