John Ensign's Blog

President Obama's cap-and-trade plan is really a national sales tax on energy with the stated purpose of driving up energy costs by thousands of dollars.

More from my op-ed in the Las Vegas Review-Journal:

President Barack Obama has been shockingly upfront about his heavy-handed plans to govern energy production across the country from Washington, D.C. His plan is known as cap-and-trade, but it amounts to a new national energy tax that will be detrimental to consumers' pocketbooks at the worst possible time.

President Obama noted that "under my cap-and-trade plan, electricity prices would necessarily skyrocket" and his Budget Director, Peter Orszag, testified before Congress that under this program "firms would not ultimately bear most of the costs of the allowances but instead would pass them along to their customers in the form of higher prices ... price increases would be essential to the success of a cap-and-trade program."

So we know the president's plan would raise significant revenues -- otherwise known as taxes -- paid by consumers. The question is: What will this cost the consumer?

An MIT study looked at a cap-and-trade scheme that closely tracked the president's proposal and projected revenue of $366 billion in a single year. To calculate the impact on families, we divided the revenue by the number of U.S. households to get a new tax burden of about $3,000 per family. That is a straightforward way to evaluate the tax burden per family.

Recently an employee of MIT accused Republicans of overestimating the per- household figure. The number we calculated, however, was lower than the one published in MIT's own study. Using an alternative household number, MIT estimated that $366 billion in revenue would equate to an astonishing $4,560 per family of four.

The MIT study assumed all revenues raised would be rebated back to consumers (and even after a 100 percent rebate, according to a letter they sent to Congress, they apparently conclude that energy costs would still increase by $340 a year).

It is unlikely, however, that consumers will see significant rebates from Uncle Sam because history has shown us that Washington will find ways, too often wasteful, duplicative and inefficient ways, to spend your money.

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