The Waxman-Markey bill, or better known as the Cap & Trade bill, is currently going through the House of Representatives and the Senate. This bill is designed to limit America’s carbon emissions and will end up being one of the largest taxes ever collected. In fact, the bill will impose financial penalties on companies that produce carbon dioxide and other gases. Carbon dioxide is a byproduct of burning wood, coal, gasoline, etc.
Who do you think is going to bear the brunt of these taxes? You guessed it, you and me, along with every energy intensive facility in this country. Coal miners, especially those on the East Coast, are likely to be out of a job. Coal power plants that produce more carbon dioxide than allowed will have to buy the right to produce more. That additional cost will be passed on to consumers, you and me.
American steel producers are huge carbon emitters and will likely be crushed by this legislation as well. Foreign steelmakers will not be affected by this and steel imports will increase dramatically, which is just more bad news for our already fragile economy.
Then there are the refineries, they are responsible for more than 40% of carbon emissions and as such will be the biggest buyers of carbon credits. Many of the smaller and older refineries will close and we will be importing more foreign gasoline. More bad news for the economy and the price of a gallon of gasoline.
This whole nightmare pales in comparison to how insignificant “global warming” is going to affect it. Let’s all understand one thing right now, this 1200 page bill is not about saving the ecosystem for decades to come, it’s about dollars, yours and mine, right now.
Based on analysis by the Heritage Foundation (a conservative think tank), the combined cost of the bill would be $3,000 per family in 2012 and $20,000 per household by 2035. How can you or your family be expected to handle the burden of such a cost? additional? $20,000/year. What is that going to do for your standard of living?
The question you should be asking yourself is, can I profit from this fiasco? The answer is, I think you can.
Who benefits most? Probably green energy companies. You can look into some green energy ETFs, that way you’ll be more diversified than buying one or two of these small-cap stocks. Nuclear power producers will probably be another winner, they don’t produce carbon dioxide. They just keep getting paid to do what they’ve always done, but now they’ll have the added income of being able to sell their carbon credits.
Make no mistake, selling credits will be big business. That brings to mind that the brokers selling these carbon credits will also get a nice boost to their bottom line.
