What weighs 16 pounds, stands 14 inches tall, includes 1,480 components and 500 internal mechanisms, costs $825 billion, has more than 1,000 teeth, and may need 200,000 caretakers?
It’s called ACES, the catchy acronym for the American Clean Energy and Security Act authored by Congressmen Henry Waxman and Edward Markey. While typically labeled as the “cap and trade” bill because those provisions are its economic driver, they cover only 400 of the almost 1,500 pages.
The U.S. House of Representatives passed ACES in late June by a mere seven votes. How many of the 435 House members even scanned the contents of this huge bill? The August reading assignment for the U.S. Senate should be to read ACES and note that it includes the kitchen sink.
ACES was rushed through the House floor in less than a day. The Senate is likely to consider the bill in October. If ACES received the scrutiny now appropriately heaped on health care reform, the U.S. Senate might recoil at the unprecedented scope and price tag. A lingering recession with high unemployment may be the worst time to impose a steep energy tax and dramatically expand the size of government.
ACES would unleash federal control of U.S. energy production and use, a backdoor to effective control of the entire economy. A wise economist once said that the path to socialism can be most easily laid with green bricks. The bill’s carbon caps, fuel mandates, and unrealistic renewable electricity standards (20% of domestic supply in 2020) would control energy production. The breathtaking scope of energy efficiency mandates would control energy use.
ACES would impose detailed federal building codes for commercial buildings, residences (including mobile homes), and public housing. Twenty sections of the bill establish “energy and location efficient” mortgage requirements. Fannie Mae will join the “greening.” If an energy-efficient location is a puzzling concept, recall that driving considerable distances is not “green,” according to Uncle Sam’s social engineers.
Conspicuously absent from promotion of ACES is the federal price tag. This is yet another bill requiring almost one trillion dollars in federal expenditures. The Congressional Budget Office estimates direct government spending authorized by ACES at $822 billion. The revenue estimate is $845 billion. “Remaking” American energy is a big project but ACES pays for itself? Only via a huge tax levied on energy producers and then passed on to consumers in energy prices.
Through ACES, the federal government would create a new, extremely valuable, paper commodity-a carbon allowance. Government gives paper permission (a carbon allowance) in exchange for hard cash. The bill sets a minimum price at the first federal Strategic Reserve auction of allowances at $28 per ton of CO2. In principle, the price should steadily climb or perhaps “skyrocket,” as candidate Obama characterized electricity prices under ever-shrinking carbon caps.
If the scope of ACES is daunting, the complexity is dizzying. David Bookbinder, senior attorney for the Sierra Club, recently commented, “This is the most complex piece of legislation in the history of our country which may make it the most complex piece of legislation in human history … it imposes on EPA alone approximately 600 [new] mandatory actions.” By complexity, a good bet is that two lawyers will disagree with the bill meaning on each of the 1,500 pages. And federal and state agencies will need hordes of new employees-as many as 50,000 for the U.S. Environmental Protection Agency.
Many Americans are now engaged in the health care debate but not so much with ACES. Federal control of energy doesn’t have the kitchen table immediacy of a government monopoly on heath care. Numerous national polls show, however, that strong majorities of voters oppose additional energy costs to address alleged global warming.
Take a measured look at ACES. If reading it seems absurd, then just stare at the size, cost, and scope. Run a finger through the 10-page table of contents. Consider more than 1,000 new federal dictates implemented by 21 federal agencies.
In his book Earth in the Balance, Al Gore proclaimed that the environment must become “the organizing principle of society.” Hard to know what that would look like until ACES appeared: federal control of energy as the organizing principle of the economy.
Kathleen Hartnett White is Distinguished Senior Fellow in Residence and Director of the Armstrong Center for Energy & the Environment at the Texas Public Policy Foundation, a non-profit, free-market research institute based in Austin. White is the former Chair of the Texas Commission on Environmental Quality.