I come to the floor tonight--and I will be joined by a couple of my colleagues--to talk about the President's budget and the issue of the carbon tax proposed therein. Part of the President's budget submission is $686 billion raised by a…
I come to the floor tonight--and I will be joined by a couple of my colleagues--to talk about the President's budget and the issue of the carbon tax proposed therein.
Part of the President's budget submission is $686 billion raised by a carbon tax. This poses a serious number of questions, and I will highlight the history and then talk about how that addresses a concern from, really, a large part of this country, especially the Midwest.
When the 1990 Clean Air Act passed and was signed into law, a mining operation in my congressional district, Peabody Mine #10, which is located right here, a big facility, very efficient, and the great thing about this facility was that right across the street and down the road was a coal-fired generating plant.
So you have what you hear a lot of people talk about today, a mine mouth operation, where you have the coal located underground and you have the power plant on the surface. So you save in the aspect of transportation either by rail or by truck.
What happened under the Clean Air Amendments of 1990 is what will happen as we move to a carbon-constrained regime when we monetize carbon, is that in this process there will be winners and losers. So I am coming to the floor tonight to talk about who these people are and why are they in this debate. One of the most clearly identified losers in a cap-and-tax regime are the miners.
Now, we hear a lot about green jobs, but I can guarantee you that the green jobs created will in no way match the loss of the fossil fuel industry in this country. And when I say fossil fuel, I talk about all the fossil fuel regimes, from coal to crude oil to natural gas. And we could go, as we talked about last fall oil shale, we could talk about the tar sands, vast resources of energy which, through a climate change regime, through a cap-and-tax provision, we could lose.
Well, these guys lost out and ladies. This one mine in southern Illinois that had over 1,200 miners was shut down, and it was shut down to meet the requirements of the 90 amendments to the Clean Air Act. So I find it very, very difficult when my colleagues say there will be no effect. And we have been very successful, I think, in this debate to highlight the reality that people will lose jobs as we move to address the climate regime. These guys and these ladies lost their jobs. This is one mine.
I talked to an individual who was a business agent for the United Mine Workers who told me, at one time before these acts were passed there were about 16,000 bargain members of the United Mine Workers in southern Illinois. After this last legislation was passed, he was reorganized into a three-State region and he only was working for at that time 4,000 miners. So he went from 14,000 miners in southern Illinois to 4,000 United Mine Workers in a three-State region. There will be definitely be effects, and it is the blue-collar jobs, the working men and women who have mined our coals.
The historical importance of coal mining is part of the reason why many immigrant families found jobs when they moved here. I am a fourth- generation Lithuanian. My great grandfather came to this country and worked in the coal mine. That story is told over and over and over again and highlights the importance of this debate. So you go from this coal mine, this operation to nothing, you go to this job loss, and then you go to the last revenue for the county.
Now, this is just one story that can be told over and over again in just my State, central Illinois, from central Illinois all the way down to the southern tip, that story of miners losing their jobs. So that is why we come to this debate. And we come fervently to talk about the challenges of a cap-and-trade regime.
In this country, the portfolio of energy, again, in this chamber the electricity produced is by a coal-fired power plant just two blocks away from here. The electricity generated in this country is generated by 49 percent coal. So just imagine that you take coal out of the equation. Now you have current demand and you have less than half the amount of supply. And if you understand supply and demand, costs will then escalate. Who will that cost escalate to? Well, it escalates to everybody.
We hear about the President is making work pay tax credit, the $300 to $400 a year for an individual or the $700 for a couple, that is for 95 percent of all Americans, as he promised. But what he hasn't been able to explain is how, as he passes this cap-and-tax on to the American public, he is going to tax everybody, 100 percent, because we will pay, the consumer will pay for the energy used across the board, because energy is used in everything that we touch, we eat, we consume in this country, and that cost will be passed on in higher costs.
So now let's just talk about the manufacturing sector. If you think that the manufacturing sector that is in this economic malaise right now, you think it is better served with low energy costs or high energy costs? I think the answer is clear: It is better served with low energy costs. If our manufacturing sector is completing against the likes of India and China in the manufacturing sector, do you think our manufacturing sector is better served with higher costs versus the competitors of India and China? Of course they are not. But this Congress and this President is planning to threaten the economic vitality of this country on this cap-and-tax regime and put thousands and thousands of people employed either in the mines or in the power plants or in the manufacturing sector out of work.
And I am just going to end with this story, and then I will yield to my colleague from Minnesota. People say, well, you know, America has got to lead. We have got to lead the folks from India and China. I was in a bipartisan meeting with senior Democrat leaders talking to a senior Chinese official; and I didn't ask the question, two of my democratic colleagues asked this question. The question was: Will China ever agree to an international cap-and-trade regime that is complied by the worldwide organization?
After answering both questions for about 15 minutes, the answer was the same, and this is a paraphrase. He said: You know, the United States and Western Europe built their middle class by cheap fossil fuel use, and now it is our turn. Now it is our turn.
So for anyone who thinks that they are going to comply just because we have now guttered ourselves and made ourselves less competitive and they are going to be goody two-shoes and going to join, they are wrong, and they are not understanding this other simple fact. I think in January, more automobiles were sold in China than in the United States. They are only starting their era of fossil fuel use. They are not going to stop their era of fossil fuel use. They are not going to comply with any international standards.
So our pain, our job loss, our inability to get out of this recession or this economic malaise is going to be held hostage to the fact that China is going to do nothing. We are going to tell our blue-collar workers out there, yeah, we are going to shut down this coal mine in the hopes that we can encourage China to join us? Are they kidding me?
So that is why we took to the floor. There is a lot more to talk about. I appreciate my colleague and friend from Minnesota for coming down, and I would like to yield time to her.
I think there is a group that will have jobs in this regime, and it is the Wall Street traders.
The cap-and-tax regime, the cap-and-trade regime is predicated on the fact they are going to trade these carbon credits on a trading floor. So we are going to allow folks like Goldman Sachs and Bear Stearns--my colleague from Ohio just left the floor talking about the demise of the economy based upon shady actions. My colleagues on the other side who are on the floor are always throwing bombs at the New York Mercantile Exchange and these traders, the people who trade these instruments on the floor. This is a way for rich people to get richer, when you have a trading floor for carbon.
If my colleagues on the other side were intellectually honest, and I don't think they are being intellectually honest, they would say, let's outright cap, let's tax carbon emissions. Let's put a monetary amount on the carbon emission, and let's make it transparent so the public understands how much they are going to pay to try to mitigate carbon use. But they can't go that route because they can't be intellectually honest in this debate because they know the public will not accept the increase in energy cost and the job losses that are going to incur. So what do they do? They package this cap-and-trade trading floor scheme. And the same people they vilify, the Wall Street traders, are the people they are holding up saying, oh, no, but this system is going to work fine.
So, this carbon tax, I pulled this out, this is the President's ``making work pay tax credit.'' I think we are being generous saying it is $800. I think it is about $700. The impact of a cap-and-tax provision as proposed in the budget is $1,600 per individual. So the net loss to the individual, the household and the family is $800. We are in the hole. We are not making money on this deal. We are behind.
Who is going to determine where this money goes to? The story I like to tell is that it is like the bank robbers. They rob the bank. They go to the hideout. And they put the loot on the table. And
where do the real fights begin? The fights begin as to how they are trying to split the proceeds. What is going on here in Washington now is my friends on the other side are trying to buy off votes to pass this regime promising this largess, which is a tax increase paid for by us, saying, ``don't worry, you will get your share.'' It is just like the bank robbers. And that is why I'm so angry about it.
I yield to my colleague from Minnesota.
I appreciate that comment. That is really the irony of this whole debate. If all this money was going to go to mitigate carbon emissions or to help us adjust to this change, you may get some people, even though I still don't agree with it, who would say, okay, we know where it is going. But the fact that this money is going to go to grow government just shows you the problem they have with the real debate of what the real reason is that this cap-and-tax regime is being initiated.
I'm happy to be joined by my colleague from Tennessee, Congresswoman Blackburn. Thanks for coming down.
I wonder if my colleague would stay for a minute and just go into a little dialogue as to in an economic decline, where we are fighting for every job, why would we put an additional burden on our manufacturing sector and the average American citizen in the aspect of raising taxes? Why? It just doesn't seem sensible when you need to get the jobs to get the economy moving again. What do you think is going on?
I thank my colleague. I think the answer is they have got such a large majority on their side of the aisle that this is the time to pass it. It is a religion now. It doesn't have to be based on facts or the time that is at hand. We can impose an additional burden on business and manufacturing and electricity generation. We can impose an additional burden on the household, but that doesn't matter. But it is going to matter because even in the analysis of the Warner-Lieberman bill, we are talking about thousands of jobs. And that, by the Henry Waxman model, that is a moderate bill. An analysis was done on that bill, and it was summarily dismissed on the floor of the Senate. Why? Because it was a job killer, a job destroyer.
So on this side we are rushing, like we are rushing all legislation, to move a cap-and-tax bill by Memorial Day which will be even more egregious than the Warner-Lieberman bill which projected thousands of jobs lost. It is a religion that has to have service now versus the needs of our citizens.
You know, here is the tax increase. Here is the mine that was shut down. Here are the coal miners that lost their jobs. You were at the hearing. We had the Ohio Coal Association testify. When I talked about the environmental impact and the loss of these jobs, do you remember how many jobs Ohio lost? They lost 36,000 coal miner jobs in the State of Ohio. That is why some of my colleagues on the other side in the other body voted no.
Fossil fuel, here are some basic facts. When we came on the floor during the energy debate, we said all of the above. In our Commerce hearing, there was a proposal given to one of the panelists, if we allowed the company to shut down the coal-fired power plant and they built a nuclear power plant, would they get some of these credits because they are going from emitting some to emitting none. The answer was no.
We were looking around asking, Isn't that why you are proposing this? Don't you understand that we still need electricity, a 30 percent increase in the next 20 years. I have a teenage son. I have told the story numerous times. At home I go down to the basement, he is watching cable TV, he has his iPod in and he is surfing on the wireless Internet; three times the amount of electricity. That is what America is today.
The demand is going up and we are going to stop the production of electricity, and then people talk about renewables. Let me quote the President, and I use this one quite a bit. This is from his inaugural address. ``We will harness the sun and the winds and the soil to fuel our cars and run our factories.'' No, we won't. There is no possible way.
Before I read it again, the fact that in the renewable fuels debate, there is a debate upon calculation of the use of land which the EPA is going into. So if you are using bio-diesel, soy- diesel, they want to say if you produce soybeans, that encourages the Brazilians to go into the rainforest and so we want to mitigate that loss of the ability to sequester carbon in the rain forest, so we are going to say no to renewable fuels.
But here is from the inaugural address. ``We will harness the sun and the winds and the soil to fuel our cars and run our factories.'' Now I am a big renewable fuels guy. I like ethanol and I like bio-diesel. I think the thing that really stood out for me is ``run our factories.''
The stats I use are this. I just ask for one steel mill. I take a steel mill that uses 545 million kilowatts a year. It would require roughly 138 wind turbines on roughly 12,443 acres of land for that total output. However, during peak load at the steel mill, it requires 100,000 kilowatts. For that you would need roughly 825 turbines on 33,000 acres of land to account for peak load. Now that is just one steel plant that may be close to me. Now add to that the second steel mill and add to that the refinery. What we are trying to do in this process is help educate the people. Right now 1.6 percent of our electricity is generated by renewables. So let's double it. That's a good goal. So 3.2 percent of the energy would then be by renewables. You are still going to have 50 percent coal, 20 percent nuclear, 20 percent hydro. It is still going to be part of the electricity generation mix, and a critical part if we want low-cost energy.
I thank my colleague from Tennessee for joining me. Many States have power companies. I am fortunate to have some that aren't for profit. They are rural electric coops, like the Illinois Municipal Electrical Association. So their ratepayers are their constituents, so the elected officials are running this electricity generating and operation and distribution system for the people who vote for them.
They have made themselves pretty clear that this cap-and-tax regime will create a huge tax burden on the people who vote for them.
I have some stats that were sent to me. The Illinois Municipal Electric Association revenue requirements, without allowances in 2015 are approximately $320 million, or $60 per megawatt. The cost with allowances at $20 per ton is $510 million.
This is additional cost incurred to the utility that has not been planned for. When you have an additional cost and you are providing a service or a good, business, whether it is profitable, for profit or not for profit, will cost will pass that cost on to the consumer. That's where we make this claim that a cap-and-tax regime will raise taxes on the individual and it will cost jobs.
One of my colleagues talked about this article in the paper today, ``China: Importers Need to Share Blame for Emissions,'' and it basically says that global warming would not require China to reduce emissions caused by goods manufactured there to meet demand elsewhere. The basic premise is that it is the people who are purchasing the goods who will pay for any burden increase.
Another story, ``University of Wisconsin-Milwaukee Study Could Realign Climate Change Theory,'' and I want to quote one paragraph.
`` `In climate, when this happens, the climate state changes. You go from a cooling regime to a warming regime or a warming regime to a cooling regime. This way we were able to explain all of the fluctuations in the global temperature trend in the past century,' Tsonis said. `The research team that sound the warming trend of the past 30 years has stopped and in fact global temperatures have leveled off since 2001.' The most recent climate shift probably occurred at about the year 2000.''
That is why the climate-change activists and those who promote the carbon tax regime, that is why they are so befuddled and they want to move this quickly because what has happened to the temperatures over the last 7 years? Has it gone up? No, it hasn't. The average temperature has gone down, and since it has gone down, it has got them very frustrated on how they are going to sell this cap-and-tax regime to the public.
Madam Speaker, I would like to submit for the Record these two articles for submission with this Special Order.
Madam Speaker, in the fall of last year, we really made a concerted effort to talk about the energy needs of this country, and we brought to the floor the basic debate that we wanted a more-of-the-above strategy. We wanted to incentivize coal, we wanted to incentivize nuclear power, we wanted to incentivize wind and solar, renewables, and we wanted them to compete for the public's demand based upon cost so that you would create jobs.
I brought this chart to the floor numerous times over the last Congress to point out the fallacy of not having an all-of-the-above strategy. And why I bring this up now is that this cap-and-tax regime will not help this all-of-the-above strategy, will not broaden the portfolio of fuels that we are able to use and compete for. It will restrict them to a point where we are going to price ourselves out of the ability to use fuels.
This chart is pretty clear; it just shows jobs being created in a--I wish it was a coal mine that is about 3,000 feet under the ground in southern Illinois, but it is an open mine probably in the Wyoming basin in Montana or Wyoming. And you see people working, recovering the coal. Recoverable coal.
Then you take that mine and you move it to a coal-to-liquid refinery. The jobs to build this refinery would be good-paying, building trade jobs. We have an expansion of an oil refinery in my district. Right now, in this economic decline, 1,000 jobs are being created to expand this refinery. That's the type of jobs you could have by building a coal-to-liquid refinery.
Then, wherever this refinery is located, you then develop a pipeline. I saw a natural gas pipeline being laid from my district last fall. It takes a lot of skilled labor, a lot of time, and a lot of patience to move a pipeline. And that is good-paying American jobs.
Then, in this case, the coal-to-liquid debate is a national security issue. We have in the United States an Air Force base where coal-to- liquid has been tested to be used in Air Force planes. This is what the Department of Defense wants for national security purposes to not be held captive to imported crude oil. This proposal, and proposals like this, are dead on arrival here in Washington. Why are they dead on arrival? They are dead on arrival because of this carbon tax provision, this carbon tax regime.
Again, I want to be clear; if my colleagues on the other side want to be intellectually honest, let's just tax it, know how much we're going to receive, and watch the pure transparency of the money going from the payees to the government, who is going to pay up. It is not the best solution, but it is better than setting up a trading floor, like so many that have been demagogued on this floor, of the rich getting richer by working the trading floor markets--the Bear Stearns of the world, the Goldman Sachs of the world, the NYMEXs of the world. And hopefully this will not get passed and signed into law, but I know that if it will, my friends will be down here arguing and complaining about the people who are manipulating that market. And that manipulation is going to cause costs to increase. And there is going to be a lot of wealthy people making a lot of money on a carbon tax regime, and it is going to cost many thousands of people their jobs.
In a slow economy, when you are trying to encourage job creation, job development, the best way to be competitive is to have low-cost energy. When only 1.6 percent of your electricity in this country is generated by renewables, you have to understand that you are not going to get to 90 percent of your electricity being generated by renewables. If we are good, we may get to 3.2. If we are extremely good, we may get to five.
So that begs the question of where the other electricity is being generated. If we want low-cost power, it has to be with the use of recoverable coal in our Midwest States and our northwestern mountainous States that have, arguably--this country has, arguably, 240 years of recoverable coal. That is coal that we can recover and use for practice. Now, we have a lot more, but that is the amount that we know that we can recover and still make money on it because their coal seams are big enough, you can engineer it and the like.
Madam Speaker, I appreciate this opportunity. I have been talking about energy for many years now on the floor. In the Energy and Commerce Committee, we have had numerous hearings on climate change and how to address this.
You will hear the terminology of cap-and-trade. Remember that the trading floor, which people will buy credits, those purchases of credits will raise the costs of people who use energy--whether they are truck drivers, whether they
are people who manufacture goods and services and use a lot of electricity, you name it, you buy it, there is going to be an added cost to that good or that service based upon climate change. That money will then go to the table to be split up by legislation that we pass here.
I would just hope that, first of all, we don't do that; but if we do, that that money goes to mitigate the loss of jobs or the increased cost to the individual consumer, not to grow government, not to create new policies. That money has to go to transform this Nation. I fear it will not. I fear it will not do the job.
My friend from Iowa is here. I only have a couple minutes. If he would like to join me, I would be happy to hear any comments he wants to add.
I thank my colleague. And I think even my colleagues on the other side will understand the kind of sincerity I bring to this debate. Because in 1992, I was at a rally to save these coal miner jobs. It was at the Christian County Fairgrounds. This mine was closed because of the Clean Air Act Amendments of 1990. They shipped in western coal to meet the standards, and 1,200 miners lost their job.
There was a rally that brought in a lot of politicians who said they were there to fight to save these jobs. One of them whom was there voted for the Clean Air Act that destroyed these jobs. I think that's a little hypocritical. If you pass legislation that is going to destroy these jobs, don't come crying and saying, shame on that company for closing that mine down.
My job, through this whole cap-and-tax debate, is to make sure that, when all is said and done, this body, my constituents, will know that I did everything possible to save the remaining coal mining jobs in southern Illinois and I did everything possible to make sure that coal- fired electricity generation is still part of our portfolio because it is a low-cost fuel, and it will help us in our competitive nature in this country.
And so I want to walk away from this debate--hopefully I'll win, but I want to walk away from this debate saying, it is for these folks that I came down to fight. I know my colleagues on the other side, those who even disagree with the basic premise I think will appreciate the emotion and the fervor that I am going to bring to this.
[From the Indianapolis Star, Mar. 16, 2009]
China: Importers Need To Share Blame for Emissions
(By Dina Cappiello)
Washington (AP).-- Countries buying Chinese goods should be
held responsible for the heat-trapping gases released during
manufacturing in China, one of its top officials said Monday.
The argument could place an even greater burden on the U.S.
for reducing pollution blamed for global warming.
Li Gao, China's chief climate negotiator, said that any
fair international agreement to curb the gases blamed for
global warming would not require China to reduce emissions
caused by goods manufactured there to meet demand elsewhere.
China has surpassed the U.S. as the world's largest emitter
of greenhouse gases. But 15 to 25 percent of its emissions
are generated by manufacturing goods for export, Li said.
``As one of the developing countries, we are at the low end
of the production line for the global economy. We produce
products and these products are consumed by other countries.
. . . This share of emissions should be taken by the
consumers, but not the producers,'' Li said during a briefing
at the Capitol's visitor center.
Li directs the climate changes department at the National
Development and Reform Commission and was in Washington,
along with negotiators from other countries, to meet with
Obama administration officials. President Barack Obama has
indicated a willingness to enter into a global agreement to
reduce greenhouse gases.
But China's stance could be one of the stumbling blocks
facing the U.S., China's largest trading partner, when
negotiations to broker a new international treaty begin in
Copenhagen in December. Li said China was not alone in
thinking that emissions generated by the production of
exports should be dealt with by importing countries.
Li also criticized proposals by the U.S. to place carbon
tariffs on goods imported from countries that do not limit
the gases blamed for global warming. Lawmakers on Capitol
Hill are considering it as they draft legislation to control
global warming pollution to ensure that U.S. goods can
compete with cheaper imports from countries without
regulation.
``If developed countries set a barrier in the name of
climate change for trade, I think it is a disaster,'' Li
said.
Neither China nor the U.S. ratified the last agreement, the
Kyoto Protocol, which expires in 2012.
China has long insisted that developed nations bear the
main responsibility for cutting emissions. As president,
George W. Bush refused to sign the Kyoto Protocol because he
said developing nations like India and China should not be
exempt.
Negotiators from other governments at the Monday briefing,
including the European Union and Japan, said that they would
not support China's proposal to unload a portion of its
greenhouse gas emissions on importers.
``I think the issue here is we take full responsibility and
we . . . regulate all the emissions that come from our
territory,'' said Artur Runge-Metzger, who heads the climate
change strategy and international negotiations unit at the
European Commission. Runge-Metzger said that if China's
approach were adopted, it would require allowing other
countries to have jurisdiction and legislative powers to
control emissions outside their borders.
Li was joined by Vice Chairman Xie Zhenhua of the National
Development and Reform Commission in his visit to Washington.
Xie met with U.S. climate envoy Todd Stern at the State
Department on Monday. The talks in Copenhagen were among the
topics discussed, said State Department spokesman Robert
Wood.
``There's a willingness, particularly on the Chinese side,
to really engage on the subject of climate change, and we
welcome that,'' Wood said.