Senator Cassidy and Graham’s CO2 Emissions Tax Will Be Expensive and Cause More Inflation
Senators Bill Cassidy (R‑LA) and Lindsey Graham’s (R‑SC) recently released legislation to create a tax on imports based on “pollution intensity.” Their legislation creates a “foreign pollution fee on imports” which is really a CO2 emissions tax. It will make many things from China more expensive, fueling more inflation. Bidenomics needs no help causing inflation.
Worse, this bill lays the groundwork for a United States CO2 emissions tax.
Senator Roger Wicker (R‑MS), another original co‐sponsor of the legislation, realized how bad this CO2 emissions tax was and wisely withdrew his endorsement.
The Cassidy-Graham CO2 emissions tax defines “pollution” exclusively as greenhouse gas emissions. They conflate sulfate pollution and emissions of carbon dioxide. Sulfate air pollution is small particulate matter, which is a pollutant regulated by the EPA’s National Ambient Air Quality Standards (NAAQS). Sulfate is a real pollutant which can irritate the lungs when inhaled.
Carbon dioxide is a naturally occurring trace gas that is not a real pollutant or a criteria pollutant under the NAAQS program. All living people and animals exhale a significant amount of CO2 with every breath. About 40,000 parts per million (ppm), compared to ambient air CO2 levels of just 420 ppm. We exhale 100 times more CO2 with each breath than the air contains.
In addition, the earth, according to NASA, is 35% greener in the last 40 years. Mostly because of the additional CO2. Worldwide crop yields and harvests in virtually every crop in every nation are improving because of additional CO2. Greenhouses add CO2 to help plants grow better, faster, tolerate heat better with less water.
Less people live in poverty and more are living longer because of better plant growth which supplies more food. US corn yields have nearly quadrupled in the last 60 years and 45% goes in American’s gas tanks. Since 2000, forests the size of France have regrown naturally because of the increasing CO2. Does CO2 look like a pollutant to you?
Does this proposed greenhouse gas tax include the greatest and most impactful greenhouse gas? Which is water vapor. It is 50 to 100 times more abundant than the trace gas CO2.
The bill designates the Department of the Treasury as the lead agency in creating this tax scheme. Giving more authority to the Treasury is like giving the car keys to a drunk teenager and hoping for the best.
The Treasury has strayed from providing sound money and keeping inflation low policies to its drunk on the “net zero” mission it was assigned by Biden, not Congress. We are supposed to be a nation of laws, not an imperial presidency with wrongheaded, inflation causing ideas. Nor bureaucrats conducting major, potentially dangerous, economy altering policies that congress never passed. So much for economic justice.
Treasury Secretary Janet Yellen is forcing banks and other reserve dependents to implement the never passed by congress “net zero,” policy.
“The net‐zero transition can bring about a world in which our well‐being and the well‐being of future generations is less threatened by heatwaves and storms,” she recently said. “In which our livelihoods, and the livelihoods of the most vulnerable among us, are more secure. In which our communities and our economies can prosper… The need for action is urgent….”
Senators Cassidy and Graham should be sponsoring legislation that would end the feckless imperial president’s forced transition to a “net zero” future. Not joining the expensive impossible net zero party.
International commerce, including the imposition of tariffs and other taxes, lies with Congress according to the Constitution. Granting the Treasury Secretary authority over a tax on international commerce further weakens Congress’s constitutional authority to regulate trade.
The bill also adds “Environmental Taxes” chapter, which falls under the “Miscellaneous Excise Taxes” of the Internal Revenue Code. While the foreign pollution fee is on specific goods, which could be an excise tariff. Yet, this climate tax only applies to imports and is located in two different tax chapters of IRS code.
Creating a carbon pricing board is a problem. Every federal bureaucracy strives to grow its mission. This bill would set up a “carbon tariff’ scheme through DOE’s National Laboratories, adding an Advisory Board on Global Pollution Challenges. This is a recipe for climate alarmist technocrats having free rein. This is already a major problem at EPA. Their climate crazed policies will short us of electricity and raise our rates through regulations in their zeal for net zero.
And it is an invitation to less CO2 emission‐intensive countries to impose their own CO2 emission taxes on the United States. Which the EU is attempting to do.
“The US falls in the middle of the pack globally in carbon (CO2) intensity,” according to the Niskanen Center. This means half the world could implement CO2 emission taxes on the United States. The same study finds that the EU, UK, and Japan emit less CO2 than the US.
The clear protectionism of this proposed legislation will face legal challenges at the World Trade Organization. Which we will lose, unless we have a domestic carbon tax.
Republicans would be wise to stand against all inflation causing taxes and the painful, inflation causing net zero policies proposed by Bidenomics and the democrats. Joining in is bad for our economy and is bad politics for Republicans.
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