Say Anything Blog

The Tax Foundation has a calculator out that will, after you enter in some personal information like household income and the amount of money you spend on things like electricity, just how much Obama’s cap and trade carbon tax policy will cost you.

A new Tax Foundation calculator now shows how much a U.S. cap-and-trade system would cost individual households annually. The Tax Household Cap-and-Trade Burden Calculator is based upon a study released in March, Tax Foundation Working Paper No. 6, “Who Pays for Climate Policy? New Estimates of the Household Burden and Economic Impact of a U.S. Cap-and-Trade System.” The study shows that a cap-and-trade system designed to reduce greenhouse gas emissions by 15 percent would place an annual burden of $144.8 billion on American households. The average annual household burden would be $1,218, which would be approximately 2% of the average household income.

Although carbon emission permits under a cap-and-trade system would be purchased first by energy companies, the costs are ultimately paid by American consumers. The calculator asks how much a household’s combined monthly income is (pre-tax) and how much a household spends monthly on various items like electricity, natural gas, food, clothing and transportation. It then calculates the total annual additional cost that cap-and-trade would impose on that household as well as the cap-and-trade burden as a percentage of income.

A tax hike in the mount of 2% of the average American household income is nothing to sneeze at, especially when (if it should pass) it would be part of tax hikes that would take place in order to pay for Obama’s nationalized health care plan (should that pass) and the Democrats’ plan to let the Bush tax cuts expire.

And I fully expect there to be a multiplying effect once the cap and trade carbon tax hits our markets.  It’s not just utility bills that are gonna go up.  Manufacturers.  Retailers.  Transport companies.  Distributors.  When you buy something in a store, you’ll be paying part of the carbon tax that has been applied to the manufacturer, distributor, transporter and retailer that handled it before you bought it.

I’m not sure anyone can accurately predict just how big the price hikes are going to be.