WESTERN CLIMATE INITIATIVE CAP-AND-TRADE INITIATIVE IMPOSES DRASTIC COSTS
Utah would be one of the hardest hit; thousands of jobs and millions of dollars on the line
SALT LAKE CITY – March 25, 2009 – A new economic study appears to confirm earlier findings that a Western carbon cap-and-trade scheme would destroy hundreds of thousands of jobs, and erode personal income for millions of citizens in the Western United States. For Utah, this could mean as many as 9,900 net jobs lost.
The newly released study, by the Beacon Hill Institute of Suffolk University in Boston, comes on the heels of research conducted by the Western Business Roundtable released a few weeks ago which also found that the WCI plan could seriously damage the West’s economy, if implemented in its present form. Four Canadian provinces and seven western states are full participants in WCI: California, Arizona, New Mexico, Oregon, Washington, Utah, and Montana.
The BHI study found that, if under a scenario in which 100 percent of greenhouse gas emission permits were auctioned off to emitters in a cap-and-trade scheme, the seven states would:
· Lose from 103,931 to 251,674 private sector jobs, while the permit would allow the state to hire 57,269 to 142,241 state employees;
· Put firms’ investment at serious risk by slowing investment in the region by $548 million to $1,448 million;
· Diminish total personal income, by $6.36 billion to $18.31 billion per year;
The negative economic effects stem from price and tax increases the states would impose on their respective energy and transportation sectors. A cap on carbon emissions is effectively a tax on energy production that is passed to industry, businesses and consumers, that would likely drive commerce and jobs to other states or countries.
Beacon Hill found that none of the seven WCI states would escape economic harm if the cap-and-trade was imposed. Utah could lose as many as 9,899 of net jobs, $1.84 billion in personal income, and $743.32 of annual disposable income for a family of four.
“The WCI is the worst sort of government planning, but its ill-effects would be typical. It creates a crisis out of thin, and evidently warmer, air and then creates solutions to address problems that don’t exist. That’s not policy, let alone sound policy. It’s a case of good, if fanciful, intentions gone awry,” said Sutherland President Paul Mero.
The complete study is available at www.beaconhill.org.