Kevin Drum, Matt Yglesias, Ryan Avent, and Ezra Klein all point to a recent CBO report that predicts the cost of Waxman-Markey to an average American family will be about $175 per year by 2020 as news. And further, as news that undermines any claim that emissions abatement will be more than trivially costly. Messrs. Ygelsias and Avent did follow-up posts asserting that this is likely a gross overestimate of the costs.
First, this isn’t news. As per my post of about a month ago (helpfully titled “Waxman-Markey Cost Benefit Analysis”), this is consistent with the earlier EPA cost prediction of about $160 per household per year by 2020. Technically, the new CBO prediction is about 10% higher.
So what’s the problem? Doesn’t this mean that opposition to Waxman-Markey on cost/benefit grounds is blind and uniformed? The problem is that achieving the benefits of Waxman-Markey would require that the emissions abatement continue long, long past 2020. Costs will continue to rise decade after decade. The same EPA report projects that the average cost per household will be about $1,100 per year (equal to a little less than 1% of total economic consumption) by 2050. That’s according to the EPA, who I’m sure are grossly over-estimating the costs of environmental protection, just like those other anti-environmental crazies at the CBO.