Congress is rumored to be considering passing a cap-and-trade plan through budget reconciliation, which is a process that is only completed if there are special instructions passed in the budget resolution and requires a simple majority, rather than a 2/3rds vote to pass the Senate.
Unfortunately, this action sets a very low bar for a high-cost, big-government bill such as cap-and-trade, but fortunately the Blue Dogs, a group of fifty-one fiscally conservative House Democrats, have warned that the reconciliation strategy is a bad idea.
The budget reconciliation “is utilized when Congress issues directives to legislate policy changes in mandatory spending (entitlements) or revenue programs (tax laws) to achieve the goals in spending and revenue contemplated by the budget resolution.”
While the Blue Dogs support Obama’s agenda,
One concern surrounds cap and trade, which the Blue Dogs contend pits regions of the country that have plentiful renewable resources against regions that produce traditional energy resources, such as coal. He said Blue Dogs oppose using reconciliation for cap-and-trade to ensure fairness. House and Senate Democratic leaders and the White House this week said it remains an option.
Blue Dogs also do not want a resolution that assumes cap-and-trade revenues are dedicated to any specific policy, the document said. Rather, it should encourage responsible and efficient energy production and reasonable tax policy while providing affordable energy.”
In the Environmental Protection Agency’s section of the budget blueprint, President Obama lays out a “Comprehensive Approach to Transform Our Energy Supply and Slow Global Warming.” To support their budget, the administration is hoping that Congress passes a cap-and-trade bill that would reduce carbon emissions 14 percent below 2005 levels by 2020, and approximately 83 percent below 2005 levels by 2050.
Heritage Senior Policy Analyst Ben Lieberman emphasizes that a cap-and-trade program is nothing more than a regressive tax that will raise prices on energy and cost Americans jobs – all for little, if any, environmental gain.
Furthermore, encouraging responsible and efficient energy production does not mean taxing proven, reliable energy prices so the government can fund the unsuccessful ones. Efficient energy production has and will always come from the private sector and any cap-and-tax plan to reduce greenhouse gas emissions is far from reasonable tax policy.
The Blue Dog Democrats should be commended for speaking up and signaling they want to take budget discipline seriously. With large deficits already, a big entitlement problem, and unprecedented amount of spending in the first three months of the year (with no end in sight), it’s imperative to stick to budget principles and not spend so lavishly.