Senator Ensign Offers Some Facts About Cap & Trade

Thank you for contacting me with your concerns about the American Clean Energy and Security Act of 2009, also known as the Waxman-Markey cap-and-trade bill. I value the opinions of every Nevadan and am always grateful to those who take the time to inform me of their views.

Global climate change has become an issue of great debate in the scientific community over the last two decades and is a top priority of the Obama Administration and Democrat Majority. Although the short-term and long-term impact of climate change is still being evaluated, it is an issue that deserves our careful attention. We must pursue reasonable global and national action to ensure the safety of our global ecosystem. In the past, I have voted to protect both our environment and the U.S. economy, instead of one at the expense of the other. In order to truly protect the environment, we must use sound science to employ responsible policies that reduce emissions based on attainable goals and not on arbitrary numbers.

As you may know, the Waxman-Markey bill seeks to impose an economy-wide “cap-and-trade” system to reduce greenhouse gas emissions over the next several decades. This cap-and-trade system would require any business or industry that creates carbon emissions to limit their carbon output based upon a limited number of available carbon credits. The federal government would then auction off these credits and use the additional revenue to fund more government spending.

This plan really ought to be called a “national energy tax” as it would impose a price on carbon emissions and drive up every American’s energy costs. Recently, Peter Orszag, the President’s Director at the Office of Management and Budget, stated that, “under a cap-and-trade 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.” If enacted, it is estimated that the indirect energy tax in the form of cap and trade will cost American families an additional $3,000 or more to purchase the goods and services they already consume today. It would also transfer nearly $2 trillion from the already overburdened American public to the federal government’s coffers.

Not only would the cap-and-trade plan hurt American consumers, it would also be devastating to our economy. Under the Waxman-Markey bill, the aggregate losses to the United States‘ gross domestic product would reach $9.6 trillion dollars by 2035 and lead to between 1.1 and 2.5 million lost jobs. A majority of the lost jobs will occur in manufacturing and mining sectors, sectors that are so important to many of the smaller and rural communities in Nevada. These important jobs will be forced to move overseas to countries like China and India where companies would not confront a similar national energy tax.

You may be interested to know that I offered an amendment to the Fiscal Year 2010 budget that would protect taxpayers against direct and indirect tax hikes like cap and trade by not allowing taxes to be raised on individuals making less than $200,000 or couples making less than $250,000. I was happy to see that my amendment passed by a vote of 98 – 0. Unfortunately, the Democrats stripped my amendment from the final budget resolution that came out of conference.

You should know that I believe that we need comprehensive energy reform. We can accomplish this by encouraging conservation, efficiency, and expansion of our nation’s energy sources. I believe we need to open a new frontier in American energy. We should explore, in an environmentally safe way, the Arctic National Wildlife Refuge, deep-sea resources, and oil shale reserves in the Rocky Mountain region. We also need to support clean coal technology and nuclear energy. In addition to these plentiful energy sources, it is critical that America also invest in alternative renewable resources.

As you know, Nevada is blessed with many renewable energy resources. With solar power in southern Nevada, wind power in eastern Nevada, and geothermal and biomass power in northwest Nevada, our state is uniquely positioned to harness many of these alternative power sources. To support these objectives, I authored renewable energy tax provisions that were signed into law in the last Congress. These tax provisions encourage energy-efficient improvements to buildings and homes, including the addition of solar panels, geothermal heat pumps, and energy-efficient appliances. This legislation also encourages electricity production from renewable sources of energy. Furthermore, I believe that these tax provisions will create tens of thousands of new high-paying “green” jobs that Nevadans will have access to in the coming years.

I am hopeful that Congress will continue to approve reasonable provisions, such as my renewable energy tax legislation. I believe Congress can make big strides toward a cleaner environment while encouraging a robust economy.

Thank you again for sharing your thoughts with me.  Please feel free to contact me in the future on matters of importance to you.  Should you have any other questions or comments or would like to sign up for my newsletter, please do not hesitate to either write or email me via my website at



United States Senator


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