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Skip Navigation LinksHome > News > November 6, 2009 : Climate change legislation: Is it a national gas tax?

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Climate change legislation: Is it a national gas tax?
Friday, November 6, 2009

While debate on climate change legislation has centered on higher electricity costs, a potential new energy cost on farmers, families and workers has thus far escaped attention: what some call a massive new national "gas tax" on the American people.

Texas Farm Bureau District 8 State Director Richard Cortese, a crop and livestock producer from Bell County, said cap-and-trade climate change legislation could hike the cost of fuel used for farming to the point that it will have a devastating economic impact on his and similar family-owned businesses.

Speaking at a Capitol Hill news conference, Cortese said increased fuel prices, on top of other energy-related costs, would deal a sharp blow to farmers and ranchers.

"Agriculture is an energy-intensive business," Cortese told reporters. "I use diesel fuel for tillage, planting, harvesting and spraying. And I use gasoline for service vehicles for checking livestock, utility vehicles and small engines. Having a reliable and affordable supply of gasoline and diesel fuel is very important for my operation to continue to make a living for me and my family."

The event, hosted by Sens. Kit Bond (R-Mo.) and Kay Bailey Hutchison (R-Texas), highlighted a new report the senators released showing that cap-and-trade legislation will result in a considerable fuel cost increase on Americans. The senators’ report is the first such effort to quantify climate change legislation’s effect on fuel costs.

According to the report, combining the increased price per gallon of gasoline, diesel and jet fuel expected from climate change legislation such as the Waxman-Markey bill multiplied by the amount of fuel this country is expected to use over the life of that bill has revealed the truly massive new "gas tax" that climate change legislation will impose on the American people.

According to the report, the Waxman-Markey climate change legislation will impose $3.6 trillion in extra fuel costs that include:

• $2.0 trillion more for American drivers, workers and businesses;

• $1.3 trillion more for American truckers, farmers, workers and businesses for diesel fuel;

• $330 billion extra cost for American air passengers.

These figures include provisions in the legislation intended to reduce the impact of this massive new "gas tax." While present, their impact is extremely modest—only 1 percent of the extra cost is mitigated, leaving consumers with a $3.6 trillion "gas tax" bill.

America’s farmers and ranchers would be hit with $550 million in higher fuel costs in 2020 and $1.65 billion in 2050, the report says.

Cortese explained that these new statistics on fuel costs under cap-and-trade legislation raise enormous concerns for America’s farmers and ranchers.

"The type of gasoline and diesel fuel cost increases described in this report will make it very difficult for me to continue on the farm," Cortese said. "As a small businessman, I cannot pass along my increased fuel costs to my customers without running the risk of losing them. That means I would have to absorb any increased costs and have it consume my bottom line."

 

 

 
  
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