Despite predicting dire consequences if climate-change legislation is not passed, Sen. Barbara Boxer, (D-Calif.) recently told reporters that the Senate Environment and Public Works Committee would not draft climate-change legislation until late September, a full month later than expected. Pundits suspect that the delay is designed to focus efforts on health-care reform and may impact passage as it gives opponents time to highlight potential problems with this legislation, also known as cap-and-trade.
The Senate takes up climate change following the narrow passage of H.R. 2454, the “American Clean Energy and Security Act of 2009” in the House of Representatives in June. Despite last minute concessions to agriculture, this bill has been highly criticized for potential detrimental economic effects, like spiking energy cost. However, it offers an outline for the Senate to follow.
So, what does this mean to you?
An American Farm Bureau Federation economic analysis shows that, at a minimum, net farm income will decline by $5 billion annually by the year 2020 if H.R. 2454 becomes law as it is currently written — mostly due to increased production cost.
“The $5 billion impact is under the most optimistic set of assumptions,” says Bob Stallman, president of AFBF. Those estimates do not begin to tell the story of what will happen when the program mandated by this legislation fully takes hold, he adds
AFBF says that it is concerned because the bill would result in a net economic cost to farmers with little or no environmental benefit. In addition, the organization says it creates an “energy deficit” for the United States by curtailing the use of fossil fuels without supplying any realistic alternative to make up the lost energy.
For these reasons, as well as the fact that the legislation is not playing well in Peoria — or anywhere else where local industry depends on fossil fuels and lower electricity rates — cap-and-trade legislation is not expected to pass in the Senate this time. However, rest assured that proponents will bring the issue forward again if it fails.