Speaking before the Senate energy panel Oct. 14, the head of the Congressional Budget Office said that the cap-and-trade system included in the House bill would slow domestic economic growth slightly over the next few decades.
By 2020, the nation’s gross domestic product may be off 0.25 to 0.75 percent, and by 1-3.5 percent by 2050, said CBO Director Douglas Elmendorf.
Elmendorf noted that his estimates involve uncertainties and “do not include any benefits from averting climate change,” reports the Washington Post.
President Obama and congressional Democratic leaders, by contrast, have said that a cap on carbon emissions would boost the economy by providing new jobs in the cleantech sector, as well as economic growth from related cleantech exports.
Elmendorf said that, while new jobs would be created, there would significant disruption due to people in fossil-fuel based sectors losing their jobs.
Pointing out what would be the matter with Kansas with regard to cap-and-trade, Sen. Sam Brownback (R-Kan.) said his state would likely face higher energy prices under the system.
“While we’re projecting these things, people are having to deal with their basic lives on it, and this is going to be very expensive,” Brownback said.
In response, Elmendorf noted that failure to address climate change could impose other costs on Kansas, such as by harming agriculture output.
In all, Elmendorf called the economic downside to the house bill “comparitively modest.”
The House climate bill calls for 17 percent emissions cuts by 2020.
The Senate version calls for 20 percent cuts by 2020.