"cap and trade" typed on a sheet of paper still in a typewriter

Cap and Trade in a Nutshell

You may have heard a lot late­ly about the cap and trade bill which was recent­ly sped through the House of Rep­re­sen­ta­tives and is cur­rent­ly in the Sen­ate. And you may have, like I had, absolute­ly no idea what “cap and trade” — emis­sions trad­ing — is all about.

I asked Dad for a bit of clar­i­fi­ca­tion, and here it is, as I under­stand it. [2019 note: Please do not make the mis­take of think­ing Dad agreed with my cli­mate change denial in this post. He explained cap and trade well; I was just too tied up in a con­ser­v­a­tive mind­set to know any better.]

Cap and trade leg­is­la­tion is intrin­si­cal­ly tied to the idea that not only is mankind some­how affect­ing the cli­mate of Earth but that such effects are sig­nif­i­cant and could result in Very Bad Things. 

The leg­is­la­tion would put into place mea­sures which would curb the pre­sumed caus­es of cli­mate change by lim­it­ing how much car­bon busi­ness­es would be allowed to release into the envi­ron­ment. This is the “cap” part. They would be able to pur­chase increased allowances and pre­sum­ably be able to sell unused por­tions of their allot­ment to oth­er busi­ness­es — the “trade” part.”

The leg­is­la­tion will increase the cost of ener­gy. Elec­tric­i­ty, nat­ur­al gas, and even gaso­line will be affected.

Var­i­ous num­bers have been tossed around as to how much more per year each house­hold will have to pay for ener­gy costs. Var­i­ous con­ser­v­a­tive sources I’ve seen have cit­ed any­where from $1,700 to $3,000 per year per house­hold. One source I’ve seen stat­ed that the aver­age house­hold in (I think) Ohio would be pay­ing $300 per month more just for electricity.

Lib­er­al sources are quot­ing much low­er costs, though, with increas­es of $150 to $200 per year per house­hold. That’s obvi­ous­ly a much more palat­able number!

But why is there a discrepancy?

The num­bers quot­ed by the con­ser­v­a­tives seem to be based on ener­gy use remain­ing con­stant; in oth­er words and for exam­ple, a house­hold will be $1,500 more per year if the fam­i­ly makes no changes in their habits and way of life.

The low­er num­bers quot­ed by lib­er­als take into account changes in lifestyle which they hope fam­i­lies will embrace.

So what does cap and trade leg­is­la­tion boil down to?

It is the nation­al encour­age­ment of a changed qual­i­ty of life by those who buy into bunk sci­ence upon every­one, whether they accept the sci­ence or not.

You may not think your gas-pow­ered car is hav­ing a neg­a­tive effect on the envi­ron­ment, but to jus­ti­fy new­er eco-friend­ly cars, the gov­ern­ment wants to jack up the price of gaso­line as an “encour­age­ment” to dri­ve what they want you to drive.

Yes, you’re right, cap and trade is an intru­sive, manip­u­la­tive mess.

Good thing I make less than $250,000 per year so that none of this extra bur­den will apply to me… Oh, wait…





7 responses to “Cap and Trade in a Nutshell”

  1. Benjamin Ficker Avatar

    Besides the month­ly ener­gy costs, the costs for just about every­thing relat­ed to own­ing a home (land­lords own and would have to pass the costs on to ten­ants) are incred­i­ble. I’m in real estate and this bill will will def­i­nite­ly affect my clients. Check out this out from JamieWear­ing­Fool

    Beyond what it will do to our econ­o­my, at the end of the debate House GOP Leader John Boehn­er took to the floor and start­ed read­ing from the 300 page amend­ment that the Democ­rats draft­ed and dropped on the leg­is­la­tures at 3 AM, there was lit­er­al­ly hun­dred of items to impose fed­er­al con­trol over your life. Here are some highlights.

    Want to replace a win­dow? Not so fast. First you must pay for an appraisal of your house to mea­sure its ener­gy effi­cien­cy and receive cal­cu­la­tions of both before and after the pro­posed change. Hey, it may be a great excuse for those guys try­ing to avoid putting in that big bay style win­dow that the mis­sus has been bug­ging you about.

    Are you hav­ing a new house built? Back up, Skip­py. This bill includes lan­guage that tells you exact­ly where you can put your elec­tri­cal outlets.

    Did you know that for one sort of appraisal ser­vice relat­ed to deter­min­ing ener­gy effi­cien­cy there is only one com­pa­ny you can use? Yup, it is right in there along with the name of the com­pa­ny. How is it that this one com­pa­ny man­aged to land the only con­tract to ser­vice 300 mil­lion Amer­i­cans? Who is this company?

    I wish I could answer those ques­tions, but all of those pro­vi­sions and more, Rep. Boehn­er went on for almost an hour cit­ing them and still didn’t get through the whole 300 pages, is not avail­able. You see because of when the Democ­rats dropped this amend­ment at 3 AM the text of it is not avail­able. So much for that trans­paren­cy. The total bill runs on for more then 1500 pages and it con­trols every aspect of your life, from what type of car we will be able to pro­duce and buy to what type of appli­ances you have in your house.

    Under some of these pro­vi­sions you won’t be able to sell your house. Got your eyes and a quaint lit­tle place out the way and off the beat­en path? For­get about it. By the time you went through the time and expense to get it up to the new code pro­posed in this leg­is­la­tion that lit­tle place in the woods will resem­ble some­thing out the Jetsons.

    So for those who were at work and get­ting ready for their week­end, and were sim­ply tired of the wall-to-wall cov­er­age of Michael Jack­son, you came just one more step clos­er to being less free today then you were yes­ter­day. And by the way, Con­gress has blown town for a two-week vaca­tion. It is hard work turn­ing a Repub­lic into a Social­ist state. This must be stopped in the Senate.

    My biggest fear now, how­ev­er, is if the Repub­li­cans couldn’t stop this, a bill that will throw hun­dreds of thou­sands if not mil­lions out of work as the com­pa­nies they work for go bel­ly up or leave the coun­try and imposed what amounts to a nation­al home­own­ers asso­ci­a­tion on all of us, what chance do they have of stop­ping the nation­al­ized health care?

  2. John Avatar

    My Repub­li­can Con­gress­man says Cap and Trade will be good for America.
    And, he caught the Green Riv­er Killer.
    Did you catch the Green Riv­er Killer?
    No, no you didn’t.
    You can hear his inter­view here.


    Dave Reichert SPEAKS: says Cap and Trade will be good for America
    He argued that the expense would not be what the Heart­land Insti­tute, Her­itage Foun­da­tion, and Wall Street Jour­nal were pre­dict­ing. He argued that it would cost around $.48 per day and that we would have bet­ter nation­al secu­ri­ty, more nuclear, coal and refin­ing capa­bil­i­ties, and a clean­er envi­ron­ment with the bill. He argued that the con­ser­v­a­tive argu­ments against were mis­tak­en, and that Wash­ing­ton specif­i­cal­ly would be bet­ter off even though the bill was imperfect.

    And, he caught the Green Riv­er Killer.

    Yeah, it took him a cou­ple of decades, but bet­ter late than never.
    I hear Fox was think­ing about mak­ing the Series 24 about Reichert. But instead of show­ing 24 hours in a day they would have to make each episode a year.

  3. Senior Avatar

    I have not read the bill, so I can­not speak to the specifics that Ben­jamin lists. I would note that nei­ther he nor the web site he links to make any effort to doc­u­ment the claims.

    I did see that Jam­mie Wear­ing Fool links to Michelle Malkin who tries to claim that there is a “place­hold­er” in the bill. I encour­age every­one to take a look:


    Now, if it isn’t too much trou­ble, you might want to go to the actu­al bill on line


    and scroll down to the appro­pri­ate part of the table of con­tents, you will see that no such entry exists. (It is past halfway down. If you do a find for “sub­ti­tle B” it will be the third occur­ance, I believe).

    So, lots of unsub­stan­ti­at­ed claims and an out­right, lets be gen­er­ous, mistake.

    Very con­vinc­ing.

    Make no mis­take, if the bill requires I upgrade the win­dows before sell­ing the house or that I pay a con­sul­tant for a study before I replace a win­dow, etc., I will agree the bill should not pass. But I need evi­dence, not just claims.

    1. Senior Avatar

      I see my link to the bill is bad.

      If you go here: http://thomas.loc.gov/home/c111query.html

      and search for:

      Amer­i­can Clean Ener­gy and Secu­ri­ty Act of 2009 (Engrossed as Agreed to or Passed by House)

      You should be able to find your way to the bill.

  4. Senior Avatar

    I now see that the “place­hold­er” that Michelle Malkin ref­er­enced was in the bill “report­ed in the House”, but it is not in the bill passed by the house. So Michelle is cit­ing the wrong ver­sion. Since the bill passed on June 26 and Michelle post­ed July 1 I think that’s a pret­ty big mis­take, if it is one.

  5. Claude Avatar

    In this, the new era of respon­si­bil­i­ty, weren’t we sup­posed to be able to find these bills on one of the admin­is­tra­tion’s many sites for review? As far as I know, this bill was amend­ed at 3AM the day of the vote, and those changes were not merged into the final bill before it was passed…? Did­n’t the same thing hap­pened with the so-called stim­u­lus bill?

    1. Rick Beckman Avatar

      I think you’re con­fused, Claude… Nobody real­ly expects any­one to keep cam­paign promis­es. They’re like movie trail­ers — they can make any movie look funny/action packed/emotional/awesome, no mat­ter how lame/dull/boring/fail it is. Noth­in’ but adver­tis­ing, all of it, and we all know how hon­est ads are.

      But by God, we’re Amer­i­cans, and we have the right to be swin­dled by any man­u­fac­tur­er, pro­duc­er, or politi­cian that we want.

      Now if you’ll excuse me, I’m going to go dry the Great Lakes with my ShamWow.

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Rick Beckman