Global Warming Regs Will Hand Our Children A Lower Standard Of Living

Posted on Mon 05/18/2009 by


Nick Loris

debt-graphWe’re mortgaging our children’s future. We’ve heard that phrase time and time again. President Obama used it just yesterday acknowledging that the U.S. debt load is “unsustainable”, saying, “We can’t keep on just borrowing from China. We have to pay interest on that debt, and that means we are mortgaging our children’s future with more and more debt.”

Proponents of cap and trade and any other global warming legislation are quick to argue that Americans’ short-sightedness is superseding the preservation of the planet for future generations.

We’re doing it for our children. And our grandchildren. In fact, the idealism behind curbing global warming is causing policymakers to ignore the exorbitantly high costs. But if we’re saving the planet for future generations, the benefits must clearly outweigh those costs, right?

Not right. Cap and trade would reduce global temperatures by a fraction of a degree.

What is worse, cap and trade would actually increase the burden of debt on our children and grandchildren. The Heritage Foundation’s Center for Data Analysis found that the Waxman-Markey bill would increase inflation-adjusted federal debt by 29 percent, or $33,400 additional federal debt per person, again after adjusting for inflation.

Over the 2012-2035 timeline, the negative economic impacts accumulate, and the national debt is no exception. This is 29 percent increase is above what it would be without the legislation and represents an additional $33,400 per person, or more than $133,000 for a family of four. To reiterate, these burdens come after adjusting for inflation and are in addition to the $450,000 per family of federal debt that will accrue over this period even without cap and trade.

Cap and trade does more than mortgaging our children’s future. It’s condemning our children to a life less prosperous than ours. This debt reduces the rate of growth in potential economic output, thus putting future generations on a lower plane of economic well being than ours. Cap and trade will regress the United States to a lower standard of living so we can (maybe) reduce atmospheric carbon content by an almost immeasurably small amount.

The reality is a slower pace of economic growth is the desired outcome. Capping carbon artificially pushes up the price of fossil fuels – our cheapest and most reliable source of energy. But just about everything we produce and do uses energy – some things much more than others. When faced with higher energy costs, businesses must make difficult decisions: leave the lights on or cut jobs. Typically to stay in business, they’ll choose the latter. Smaller businesses won’t be so lucky and will have to shut down.

If we want a preview of what will happen under Waxman-Markey, take a look at today’s economy. Production and consumption are down, unemployment is up and, as a result, we’re using less energy and emitting less carbon. Waxman-Markey will only be worse, with an estimated 844,000 jobs lost on average and $7 trillion in lost gross domestic product over 2012-2035.

A cap and trade plan is doing nothing but increasing that monthly payment for our children. By a lot. In an attempt to protect our children’s future, we’re doing just the opposite – all for a temperature change they’ll never notice in the first place. And in addition to more debt, we’re leaving them with a world with lower income, higher unemployment and higher energy costs.

In truth, the only thing we’re protecting our children from is a better life.

Contributing Author Nick Loris writes at The Heritage Foundation and he is a Research Assistant at The Heritage Foundation’s Roe Institute for Economic Policy Studies.

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