Planet Gore

Commerce Secretary Designee Gregg on Cap and Trade

Apparently, he’s not a fan of Obama’s plan. An excerpt from May 2008:

Senator Barack Obama, who is running for president, who appears to be very close to being successful in his quest for the nomination, has suggested that he would pay for an additional $300 billion in new spending annually. He has proposed over $300 billion of new spending annually. He would pay for a large amount of that through generating $30 billion to $50 billion annually in taxes as a result of cap-and-trade. It is estimated by some that revenue to the federal Treasury might exceed that number and actually be up to $100 billion a year annually.

 

But Senator Obama has already suggested we spend it on the expansion of the federal government. The bill itself proposes that it be spent on the expansion of government as well as on various other initiatives which the bill suggests we should pursue.

 

I’m on the floor today to suggest a different approach to that. I suggest if we go down the path of cap-and-trade and if we raise over $1 trillion during a ten-year period from consumers, we should return the dollars to consumers in some way. I believe that since we’re basically creating a consumption tax and shifting the burden of the government significantly onto the user of electricity, especially the homeowner, they should receive a reduction in taxes. If you are going to shift what amounts to a $1.2 trillion increase in consumption taxes, you ought to use the revenues to reduce income taxes to working Americans by pretty much an equal amount.

 

I believe if we did that, if we took the revenue from the consumption tax and moved it over and reduced income taxes so that working Americans could benefit from that reduction in their income taxes, you could end up dramatically reducing income tax rates on working persons.

 

That should be our goal with these dollars. We shouldn’t use these dollars to significantly expand the size of the federal government. If we’re going to create these brand-new consumption taxes to control emissions that could cause global warming, we should use the revenues to reduce the tax burden on working Americans. This should not be a windfall that expands the size of federal government and expands the size of government. It’s not right to do that.

 

The overall tax burden on the American people is already significant. It’s going to grow, regrettably, over the next few years. If you listen to some of our colleagues on the other side of the aisle, it will grow a lot. The budget that passed this Congress suggested that it would grow over $1 trillion over the next five years. We don’t need to throw on top of that increased burden of taxation which Americans are already paying, a brand-new consumption tax where the revenues are taken to expand the federal government. Instead, we should take the revenues and put them toward a reduction of income taxes.

 

Many people look at our tax policy and argue this is an intelligent way to structure this, to basically begin the shift from an income tax system to a consumption tax system as being a much more efficient way, first, to collect revenues; but, secondly, a better way to collect revenues from the standpoint of energizing a strong and vibrant economy.

 

But independent of that argument, which has been raging for years–whether consumption tax makes more sense than an income tax–what doesn’t make sense is to raise consumption taxes through cap-and-trade and then spend it to increase the size of government. Use that money to reduce the tax rate on working Americans, to reduce the income tax. That should be our goal as we move forward and debate the issue of cap-and-trade and how we’re going to use the revenues which that bill will generate.

 

I appreciate the Senator from Louisiana yielding the floor. 

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