Friday, May 15, 2009

Cap and Horse Trade    [Henry Payne]

Detroit, Mich. — Coastal Democrats cannot get their cap-and-trade bill passed without Midwest members of their own party who are concerned about its impact on industrial states. So on Thursday, Rep. Henry Waxman (D., Calif.) and Rep. John Dingell (D., Mich.) announced a deal paying off the Michigan delegation by guaranteeing that three percent of all revenue from the “Obama Energy Tax” will go to the auto industry.

Using carbon revenues as a kind of slush fund, Waxman has been cutting a series of deals to bring wary industrial-state Democrats and their constituent industries on board.

“It is important that legislators recognized the need for returning some of the investments to the industries responsible for reducing emissions,” says Charles Territo, a spokesman for the Alliance of Automobile Manufacturers.

The auto industry had already negotiated a cash-for-clunkers bill, stripping out green provisions that had required consumers buy only fuel-efficient cars. Green zealot Ed Markey (D., Mass.) cheered the clunkers bill for “helping the struggling American auto industry get back on its feet.” But more important to him is that it helps pave the way for a carbon-tax agreement that will give Washington unprecedented power over U.S. commerce and billions of dollars to distribute to pet political interests.

In addition to the auto bribes, Texas Reps. Gene Green and Charles Gonzalez are talking to Waxman about setting aside over 5 percent of total carbon-tax revenues for the refining industry. Waxman has also brought key Rep. Rick Boucher (D., Va.) on board after throwing money at the coal industry.

Of course, the original purpose of the bill was to redistribute wealth to green projects and low- to middle-income Americans. So all this horse-trading with Big Business is making some Democrats nervous. Rep. G.K. Butterfield (D., N.C.) says that — after accounting for industry giveaways — only $18 billion in carbon revenue is left for the poor. That’s “woefully inadequate to provide the safety net,” he says.

Rep Charles Rangel (D., N.Y.), is similarly concerned. “Whether you call it a tax, everyone agrees that it’s going to increase the cost to the consumer,” said Rangel. “At the end of the day . . . if there’s nothing there to repay (consumers) for their financial expenditures, it might be difficult to fight Republicans who call this a tax.”

Global warming may be last on Americans’ priority list, but it is big business for Washington’s political class.

05/15 07:00 AMShare