2009-04-02

"Light Switch Tax" Lies

Unsurprisingly, the Republicans are lying about Cap and Trade when they say it will cost every family $3,128 per year.

It's a pattern they've followed before.  Simply take a study done by a Democratic policy advocate, misunderstand or willfully ignore the obvious preconditions for the study, then apply the study in a dishonest way to the current debate.  They did it first with the Stimulus Bill, claiming their package would create twice as many jobs for half the cost.  Of course, the study they referenced was regarding the efficacy of taxcuts in a time of economic expansion - the polar opposite of our current situation.  It goes beyond the normal political games of selective emphasis - it is dishonesty.

For Cap and Trade, they're citing researcher John Reilly's study.  Here's what he has to say about their take on his work:
"It's just wrong," said John Reilly, an energy, environmental and agricultural economist at M.I.T. and one of the authors of the report [cited by congressional Republicans]. "It's wrong in so many ways it's hard to begin." [...]

The tax might push the price of carbon-based fuels up a bit, but other results of a cap-and-trade program, such as increased conservation and more competition from other fuel sources, would put downward pressure on prices. Moreover, consumers would get some of the tax back from the government in some form.

The report did include an estimate of the net cost to individuals, called the "welfare" cost. It would be $30.89 per person in 2015, or $79 per family if you use the same average household size the Republicans used of 2.56 people.

The cost would grow over time as the program ramps up, but the average annual cost over time in today's dollars -- that is, the "average annual net present value cost" -- is still just $85 per person, Reilly said. That would be $215.05 per household.

A far cry from $3,128. And that isn't the only inaccuracy in the claim.
PolitiFact called it a Pants-on-Fire level of lying, a special honor.

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