Congressional Budget for the United States Government for Fiscal Year 2010--Resumed
Floor Speech
CONGRESSIONAL BUDGET FOR THE UNITED STATES GOVERNMENT FOR FISCAL YEAR 2010--Resumed -- (Senate - March 31, 2009)
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Mr. THUNE. Mr. President, will the Senator from Alabama yield for a further question?
Mr. SESSIONS. I will be pleased to yield to Senator Thune from South Dakota.
Mr. THUNE. Mr. President, is the Senator from Alabama aware that the President's Director of the Office of Management and Budget admitted the same thing last year when he was the Director of the Congressional Budget Office? Peter Orszag said:
Under a cap-and-trade program, firms would not ultimately bear most of the costs ..... but instead would pass them along to their customers in the form of higher prices ..... price increases would be essential to the success of a cap-and-trade program.
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Mr. THUNE. Would the Senator from Alabama yield for a further question?
Mr. SESSIONS. I would be pleased to yield to the Senator from South Dakota.
Mr. THUNE. Mr. President, I appreciate very much the observation that was made about the purpose of reconciliation and the Rules Committee in the House. The House very clearly has the power to regulate what comes to the floor and what amendments are made in order. Reconciliation instructions in the House bill are clearly directed at a House-Senate conference and reserving the opportunity--the option--to actually do something with respect to these other issues.
I wish to point out, too--and I wish to ask a question of the Senator from Alabama regarding the conference committee--even though I believe the best intentions of the Senator from North Dakota and I believe he is sincere when he says he doesn't want to use reconciliation to do cap and trade and to do other types of policy through the budget process--there is a statement from the majority leader talking about the novel proposal for redoing the Nation's health care system, suggesting that using $646 billion that would be collected under a controversial Obama proposal to auction off greenhouse gas pollution allowances. The exact quote is: ``That's exactly how much we need for the first phase of health care reform.''
My question to my colleague from Alabama is: If, in fact, you get into a conference setting and you want to do health care reform--which clearly they have indicated they would like to do through reconciliation--it has to be paid for somehow, does it not? It is suggested here, I think from at least the majority leader, that the revenues available through cap and trade might, in fact, be used for that.
Would it not be possible in a conference committee setting--despite the best intentions of the Senator from North Dakota--for the members of that conference to decide to use that reconciliation process to create revenues through a cap-and-trade program that might be used to accomplish the financing of health care reform through that bill?
Mr. SESSIONS. I agree with my colleague, Senator Thune.
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AMENDMENT NO. 731
Mr. THUNE. Mr. President, I would like to speak to an amendment I laid down yesterday on which there has been a side-by-side amendment offered by the Senator from California. In response to the comments of my colleague from Illinois, there aren't any Republicans who aren't prepared to debate the issue of climate change or energy policy. We just think it ought to be debated in regular order; that when the Senate does take on big consequential items such as this, it ought to be handled in the normal routine, in the way the Senate deals with big consequential issues such as the issue of climate change because it would have a profound impact on the American economy and on American households and families.
There isn't any resistance on this side to that. All we are saying is, it should not be used as a part of the budget process where you expedite this and sort of circumvent the normal rules and procedures of the Senate that would apply to big pieces of legislation. We want to debate that.
Frankly, there are lots of Republicans who are happy to have the debate on climate change, on cap and trade, but also want to make a part of the debate the cost. It is very easy to talk about throwing out different solutions to this issue or talking about the general issue of climate change, but when you start reducing the argument on cap and trade, it has profound economic consequences on the American economy. That is a part of the debate.
If we look at the question of whether climate change is occurring, if one answers that yes, and if human activity is contributing to it, and one answers that yes, we still have to get to the question, if those two points are true: What do we do about it and at what cost? We think that ought to be part of the debate.
The Senator from California has offered a side-by-side amendment to mine. I assume she concedes the point that it would increase electricity and gasoline prices. She adds to that the language ``or increasing the overall burden on consumers through the use of revenues and policies provided in such legislation,'' suggesting there would be some offsets that families who are affected by higher energy costs would benefit from.
If there are going to be additional revenues, they are coming from somewhere. This isn't an imaginary world. This stuff just doesn't appear. We are talking about real costs, real revenues.
I want to point out what the President himself said over a year ago about his cap-and-trade plan:
Under my plan of a cap and trade system, electricity rates would necessarily skyrocket.
We cannot assume for a minute that there are not going to be enormous costs associated with the proposal of the Senator from California and the cap-and-trade proposal she put forward in the last Congress, of which the President was a cosponsor.
She referred earlier to MIT. Researchers there scored it at $366 billion a year or a cost of $3,128 to the average household. This has an economic cost. It has an impact on our broader economy, an impact specifically on American families and households and American small businesses.
I used data yesterday I had received from utility companies in my State about how this would affect their cost of doing business with regard to residential customers, small business customers, and large industrial users. We would see costs go up as much as 65 percent in some cases.
They used a typical school district. It would on an annual basis double their cost for electricity. These things have costs. That needs to be part of the debate because the American people deserve to know these things have costs.
We need to have a debate about climate change, but we ought to do it in a way that is in regular order, that allows committees to do their work and that contemplates what the costs and consequences of these policies are going to entail for the average person.
This is an amendment provided to give something for the Senator from California and Members on the other side to vote for. The fact is, a cap-and-trade policy will increase electricity and gasoline prices. Nobody disputes that. The question is how much. I happen to believe--as do many others--that the President understates it in his budget, $646 billion in revenue. There are those who believe it would be two or three times that amount. The President himself has said:
Under my plan of a cap and trade system, electricity rates would necessarily skyrocket.
His OMB Director, Peter Orszag, has said this would all be passed on to consumers. Utility companies will not bear the cost. Corporate America will not. It will be passed on to customers in places such as South Dakota where a higher energy cost is the thing they can least afford these days when we have a bad economy to start with.
I hope when Senators come to vote on these amendments, they will bear in mind these votes have consequences. If they vote against my amendment, they are essentially saying that we are open to, and OK with, a reserve fund created under the budget, a climate change reserve fund that would lead to a lot higher electricity and gasoline prices. All my amendment says is, those gas and electricity prices cannot go up under a cap-and-trade proposal that might be adopted by the Congress and might be included in some reconciliation instruction that comes from a conference committee with the House.
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