Greenhouse Cap-and-Trade System Will Harm the U.S. Economy, says Free Enterprise Education Institute

    WASHINGTON, April 10 /PRNewswire-USNewswire/ -- Global warming
 regulations backed by the General Electric Company, DuPont, Caterpillar and
 Lehman Brothers will cause higher energy prices and slower economic growth
 concludes a report by the Free Enterprise Education Institute.
     The report reviews a study by the Federal Energy Information Agency
 (EIA) of the Clinton-Gore Administration on the cost of implementing a cap
 and trade system in the U. S.
     Under the best scenario, the EIA concluded that a cap-and-trade
 regulatory scheme to reduce carbon dioxide emissions will:
     -- Raise gasoline prices by nearly 53 percent and raise energy prices by
        more than 86 percent;
     -- Reduce economic growth by 1.9 percent (about $256 billion of 2006 QIV
        GDP);
     -- Reduce economic activity across most industries including the
        construction, manufacturing, transportation and finance industries; and
     -- Exert upward pressure on overall prices and interest rates.
     "Lost in all the hype on global warming is the negative impact a
 cap-and- trade emissions scheme will have on the economy," said Wayne
 Winegarden Ph.D., author of the report. "Higher energy costs will ripple
 throughout the economy causing a cascade of harmful affects for consumers
 and industry," added Winegarden.
     The EIA report estimated the economic impact if the U.S. reduced carbon
 dioxide 7 percent below 1990 levels as prescribed by the Kyoto protocol.
 The report used a cap-and-trade system as the regulatory mechanism to
 reduce carbon dioxide emissions. Under cap-and-trade, industries are
 allowed a limited amount of carbon dioxide emissions and if they exceed
 that quantity, they must buy emission "credits" from other companies.
     United States Climate Action Partnership (USCAP) -- a coalition of
 special interest environmental groups and corporations including GE,
 DuPont, Caterpillar and Lehman Brothers -- are lobbying Congress for a
 cap-and-trade as the preferred regulatory scheme to address global warming.
     "It's shocking to see companies pursuing regulations that will harm
 economic growth and jeopardize future earnings. Higher gasoline and energy
 prices will wreak havoc on consumers' budgets already squeezed by higher
 interest rates and utility prices," said Steve Milloy, executive director
 of the Free Enterprise Education Institute.
     The report is available at http://www.FreeEnterpriser.com.
 
 

SOURCE Free Enterprise Education Institute