Schmick calls governor’s ‘cap and trade’ an economic ‘slash and burn’

‘We’re going to lose more jobs if this legislation passes,’ Schmick says

 

Rep. Joe Schmick, R-Colfax, stated his firm opposition today against the governor’s upcoming cap and trade proposal.

“The governor’s cap and trade proposal will amount to an economic slash and burn for this state,” Schmick said.  “Our businesses and families are already struggling.  We’re going to lose more jobs if this legislation passes.”

The so-called cap and trade legislation is a proposal put forth by the Western Climate Initiative, which includes seven Western states and four Canadian Provinces.  The idea is to cap the amount of carbon that may be emitted by activities such as energy and oil production, manufacturing jobs, and, by 2015, auto emissions, in order to reach 1990 emission levels by 2020.

Companies will have to purchase “allowances” from the government for the right to emit greenhouse gasses.  However, the government will limit the number of allowances and determine the market up front.  The government will also reduce the number of allowances available every three years.  If companies don’t have enough allowances to cover their emissions, they will have to pay a fine up to $10,000 per day.

If a company doesn’t use all of its emission allowances, it may sell those credits to other companies who need them.

While that might sound noble and simple on the surface, Schmick said the extra costs to businesses that have very limited options to either pay penalties, buy credits from other entities, or reduce production altogether will have a disastrous effect on the state’s economy.

“This legislation is going to back employers into the corner, with very few options,” Schmick said.  “In today’s economy, we need to renew our efforts to help businesses create jobs, not hinder them with more burdensome regulations.  We’re going to send a very scary message to businesses thinking about relocating to our state.  That, in turn, is going to hurt families in need of jobs.”

Because of an unregulated secondary market that will buy and sell carbon emission credits, Schmick said the possibility for corruption, fraud and greed will drive the price of credits to artificial heights.

“We saw it with Enron; we saw it with speculation in the oil markets; we saw it with the subprime mortgage collapse.  Secondary markets have huge potential for devastating consequences,” Schmick said.  “There’s nothing to prevent an investment firm from buying up excess allowances from businesses in our state and then selling them to states like California or Oregon.  Washington companies could be put out of business in a heartbeat simply because additional, necessary emissions credits are too expensive or unavailable.”

Because Washington accounts for only three-tenths of one percent of the world’s greenhouse gasses, Schmick said he sees no reason to rush into the cap and trade agreement.

“When it comes to current greenhouse gas emissions, we are one of the cleanest states in the Union right now,” Schmick said.  “We have cheap, clean, abundant hydropower and aggressive conservation policies already in place.  Why should we place our jobs and our state’s economy at risk?

“In my opinion, there are some very fanatical ideals being bantered about by a very vocal minority,”  Schmick said.  “Are we going to let environmental fanaticism overcome common-sense solutions?  I hope not.  I truly hope people will wake up and see this thing for what it really is: extreme behavior modification at the expense of our jobs and our families’ well being.”

The governor is expected to propose her cap and trade legislation, dubbed the Climate Action Plan, soon.

# # #

###

Washington State House Republican Communications
houserepublicans.wa.gov