U.S. Treasury Sets "Green Tax Code"
Coming soon: a green tax code for American businesses and individual taxpayers alike?
Sensenbrenner, a Republican, is a former member of the House Select Committee on Energy Independence and Global Warming, created by the Democratic congressional majority during the Bush Administration.
It is there, he says, that the National Academies study was first ordered up, by Congressman Earl Blumenauer of Oregon, in 2008—but never funded, until the advent of the Obama Administration.
A major tax study currently being sponsored by the U.S. Treasury will give environmental activists a powerful new weapon in their campaign to alter the entire American economic and social landscape in the name of halting “climate change”—including the possible levying of new carbon taxes.
That campaign is bound to intensify in the aftermath of Nov. 6’s presidential election, regardless of who wins the race, as the nation faces the challenge of deficit reduction and tax reform that will be required to overhaul the country’s over-strained finances. Environmental advocates and others are likely to raise such innovative mechanisms as carbon taxes and major shifts in tax rates and incentives as part of the process—and the impending study may well provide them with important ammunition.
Under the bland title of Effects of Provisions in the Internal Revenue Code on Greenhouse Gas Emissions, the $1.5 million study is being carried out under the auspices of the National Academies of Science (NAS). Originally planned to take two years, the ambitious project aims to take an inventory of the U.S. tax code in terms of the effects of its most important provisions on the emission of carbon dioxide and other greenhouse gas emissions—a huge and complicated exercise in environmental and economic modelling.
The study itself will not be available until after the election. Originally slated for completion in September of this year, its publication has since been postponed until the first quarter of next year.
According to a NAS spokesperson, one reason is that it must go through a rigorous, anonymous review process. But according to a NAS staffer who spoke with Fox News, another significant reason is the Academies’ demand for a “consensus” among the committee members charged with its production before the review process begins. According to the staffer the study is “still in the process of late stage revision by the committee,” and will go for review “in the near future.”
The results will likely bring an entirely new dimension to any future bargaining table in Washington that aims at achieving financial reform. Such bargaining is considered nearly inevitable as the U.S. tries to back away from the fiscal cliff created by towering annual deficits and still accelerating obligations under Social Security and still-to-be implemented Obamacare.
What the NAS study will examine are the basic building blocks of the tax system, but not from a job creation or growth perspective. Instead, the question is what levels of greenhouse gas are currently produced by its provisions.
These include not only deductions and allowances for production of varying types of energy, but also such things as the home mortgage deduction and the investment tax credit to spur business activity, not to mention tax provisions that affect patterns of urban development, agriculture, forestry and all manner of industrial processes.
In short, just about everything.
The terms of reference of the study say it “will not recommend particular new taxes or tax incentives nor changes in existing provisions of the tax code.” On the other hand, the study “may evaluate the efficiency and effectiveness of different tax measures in reducing GHG emissions relative to other policy instruments.”
In other words, the study may provide the means to “comparison shop” tax levels and tax incentives for a wide variety of economic and social activities on the basis of their alleged impact on global warming.
One element of such an approach has been frequently hinted at by the Obama Administration during the election campaign, as it has argued against unspecified subsidies for the oil, gas and coal industries and greater emphasis on “renewable” energy sources such as solar and wind which have so far proved to be much more expensive.
The National Academies’ study is being overseen by an ad hoc committee of experts, whose membership is approved by the National Academies’ president, Ralph J. Ciccerone—himself an expert on atmospheric chemistry. The membership list is a lengthy roster of climate change and legal experts as well as economists versed in the arcana of computerized economic modeling.
The committee is chaired by William Nordhaus, a distinguished professor of economics at Yale University and former member of the President’s Council of Economics under Jimmy Carter. Nordhaus has been involved in previous National Academies efforts to, as the study website puts it, “integrate environmental and other non-market activity into the national economic accounts.”
Approached by Fox News to discuss the study, Nordhaus declined until after its publication.
Until the study itself is published, it is also not possible to examine the research efforts that have gone into it, which largely consist, apparently, of four consultants’ reports commissioned by the National Academies’ committee selected to oversee the study.
One of those reports was delivered by a consulting firm headed by Dale Jorgenson, a renowned professor economics at Harvard University, and former chairman of the specific board of the National Academies of Science that was charged with producing the new tax code study.
Contacted by Fox News, Jorgenson also declined to speak about the project until a final report is published.
Among the many research items on Jorgenson’s Harvard University website, however, is testimony last June before the Senate Committee on Finance entitled “Tax Reform: the Impact on U.S. Energy Policy,” in which the economist outlines a new system of energy taxes on coal, oil and natural gas that could “clean up the environment and slow global warming” The new tax revenue could also “close the budget gap and reduce tax rates as part of comprehensive tax reform.”
According to Ken Green, an environmental expert at the American Enterprise Institute, the entire NAS study “look like another effort aimed at paving the way for weaving carbon taxes into tax reform.”
Green says that option is favored not only by political liberals, but also by some conservatives who want a “revenue-neutral” version of carbon taxes to, among other things, “green up the conservative brand.”
Green argues that such taxes are not only ineffective, but dampen economic growth and are actually regressive, hitting lower-income Americans higher than harder-income earners.
To Congressman James Sensenbrenner of Wisconsin, the National Academies’ study, whenever it appears, is “a waste of money,” whose results, whenever they appear, should be opposed. “They are simply trying to bypass the people’s representatives and use technocrats to achieve their agenda,” he argues.
Rep. Blumenauer, a Democrat,
is a strong advocate of “sustainable communities” and environmental causes. His office confirmed that he had originally proposed the National Academies study, but did not reply to additional requests for interviews or information.
Whatever the study’s origins, its research will be what counts—and in the tug-of-war between “climate change” concerns and economic growth, however that research is eventually used will still depend greatly on the results on Nov. 6.
Read more: http://www.foxnews.com/world/2012/11/01/eco-taxes-study-financed-by-us-treasury-will-link-tax-code-to-carbon-emissions/?test=latestnews#ixzz2B0gv2nxI
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