2013: Cap 'N Trade Bill Clogs Congress

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June 29, 2013 - As the first six months of the second Obama administration draws to a close, dozens of competing bills are making their way through Congress seeking to reform the controversial "American Clean Energy and Security Act of 2009."

The "Strategic Biofuels Reserve Reform Act"' attempts to cap the amount of excess ethanol the Agriculture Department is allowed to purchase and withhold from the market each year. Ethanol price supports enacted in 2010, modeled on the Agriculture Department's dairy price support program, became necessary when practical blending limits made it impossible for the transportation sector to absorb all the ethanol being produced under overlapping government stimulus programs. Exacerbating the crisis, three hundred million barrels of surplus ethanol, now being stored in former cheese caves once used to sequester excess milk, have been found leaking into local ground water. Farm state opponents of the bill argue that economic devastation would result from any limitations since 60% of US farmland has now been converted to growing fuel crops. "Besides," stated a spokesman for Ethanol First, "neighbors seem to like the water." An alternative bill banning cars that cannot run on E-85 from driving on interstate highways remains stalled in committee.

The "Promote Green Driving While Creating or Saving Jobs Act" promises a $20,000 rebate to qualified purchasers of any of the 4.7 million unsold electric vehicles piling up on GM dealers' lots. Supporters claim the rebates would reduce government spending as it is cheaper to print cash than it is to keep the unsold vehicles on the government-owned car company's books. Buyers who trade in old cars that cannot run on E-85 will also receive free cab vouchers to help them get home when stranded out of range of a charging station. Meanwhile, lithium shortages continue to roil a host of industries as members of the South American Lithium Mining cartel met in Caracas to set next year's production quotas.

In separate news, the growing carbon offset derivatives scandal has claimed another victim. The Congressionally appointed CEO of CitiBank of America resigned after it was revealed that his spouse, head of the Offsets Integrity Advisory Board, had a financial stake in hundreds of the eighteen thousand farms accused of improperly collecting carbon offset payments. Investigators were tipped off when a hacker posted a list showing that farmers collecting payments for "special planting practices" certified by the OIAB to reduce greenhouse gasses were also being paid by a separate Agricultural Department program to keep their land fallow. Remiss compliance inspectors dismissed in the aftermath of the scandal sued for wrongful termination, threatening to lead a general strike of the Federal Environmental Services Employees Union unless they were immediately reinstated with back pay.

In an effort to keep the last of the nation's oil refineries from closing, the "Save or Create Domestic Refinery Jobs Act" seeks to normalize the carbon penalty differential between domestically refined gasoline and imported gasoline. Gasoline imports reached an all time high last year as refiners shifted production to plants outside the US to avoid soaring cap and trade expenses. It is unclear whether formerly idled refineries will be able to get the necessary environmental permits required to restart operations before 2015.

The "Clean Coal Restitution Fund Act" is moving forward with wide bipartisan support, intended to compensate victims of the worst industrial disaster in US history. Survivors held a candlelight vigil in memory of the 3,000 people who suffocated in their sleep when 400,000 gallons of sequestered liquid carbon dioxide escaped from underground caverns in the aftermath of a magnitude 4.5 tremor. Computer models indicating such facilities could withstand 7.5 magnitude earthquakes were being checked for errors.

A bill intended to restart the stalled Cape Wind project met stiff resistance from friends and family of the late Senator Edward Kennedy, claiming that erecting windmills near the coast of Cape Cod where Kennedy's ashes were spread would represent sacrilege. "Uncle Ted had a special place in his heart for the waters around Martha's Vineyard," said Kennedy's nephew, who inherited his Uncle's Senate seat.

Waxman-Markey payments to low-income households designed to offset the higher cost of everything from transportation to home heating were the subject of another bill titled the "Adjustment to the Adjustment Act." Under the new bill, monthly payments made to households with income levels up to nine times the poverty line would be adjusted for inflation, now running over 16% per year. Opponents who complained that the cost of the program would exceed $650 billion dollars were ridiculed by Nobel Prize winning columnists for the New York Times, who pointed out that this represents an insignificant fraction of the annual Federal deficit.

Finally, meteorologists are projecting one of the coolest summers in years as average global temperatures continue to decline after remaining flat for over a decade despite rising greenhouse gas concentrations. Computer models indicating that the world should have ended by now are being checked for errors.

Bill Frezza is a fellow at the Competitive Enterprise Institute, and a Boston-based venture capitalist. You can find all of his columns, TV, and radio interviews here.  If you would like to have his weekly columns delivered to you by e-mail, click here or follow him on Twitter @BillFrezza.

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