What’s Inside Waxman-Markey?

According to the energy tax lobby, the beauty of their cap-and-trade legislation is its market orientation. Instead of command and control the market in all of its wisdom will force people to make the right decisions and lead us on the path to a greener tomorrow.

It would seem that noble cause could be encapsulated in a fairly neat piece of legislation but instead, the proposal runs to over 900 pages. A couple of enterprising reporters for the Washington Post found this passably strange and looked into it a little more. Here is what they discovered.

THE RUNNING joke in Washington is that nobody has read the 900-plus-page energy bill sponsored by Reps. Henry A. Waxman (D-Calif.) and Edward J. Markey (D-Mass.), which the House will consider in coming weeks. What you hear from its backers is that its cap-and-trade provisions would create a market-based program to reduce greenhouse gas emissions — which should mean that a simple, systemwide incentive encourages polluters to make the easiest reductions in greenhouse gases first, keeping the costs of fighting global warming to a minimum. In fact, the bill also contains regulations on everything from light bulb standards to the specs on hot tubs, and it will reshape America’s economy in dozens of ways that many don’t realize.

Here is just one: The bill would give the federal government power over local building codes. It requires that by 2012 codes must require that new buildings be 30 percent more efficient than they would have been under current regulations. By 2016, that figure rises to 50 percent, with increases scheduled for years after that. With those targets in mind, the bill expects organizations that develop model codes for states and localities to fill in the details, creating a national code. If they don’t, the bill commands the Energy Department to draft a national code itself.

States, meanwhile, would have to adopt the national code or one that achieves the same efficiency targets. Those that refuse will see their codes overwritten automatically, and they will be docked federal funds and carbon “allowances” — valuable securities created elsewhere in the bill that give the holder the right to pollute and can be sold. The Energy Department also could enforce its code itself. Among other things, the policy would demonstrate the new leverage of allocation of allowances as a sort of carbon currency — leverage this bill would be giving to Congress to direct state behavior.

I guess they figure that the old Mr. Market could use a little help.

I don’t want to belabor the point here, the irony is just too good. However, consider the insanity of trying to concoct a national building code. Buildings in Bangor, Maine will have to be constructed to meet the environmental challenges of Phoenix, Arizona and vice versa. Apartments in Kansas will be built to withstand California earthquakes and North Dakota structures will be impervious to Katrina type storm surges. I think you get the point.

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