Figures Don’t Lie, But That Really Isn’t The Issue
By: Doug Busselman, Executive Vice President
We’ve all heard the expression that “figures never lie, but that doesn’t mean that liars don’t figure.” When the United States Department of Agriculture came out with their preliminary analysis of the effects of the House version of the climate change bill, the reports sounded like a new miracle cash crop was ready for banking – carbon credits.
The official line, coming from those associated with the current administration (which strongly supports expanding the federal government’s reach and taxing us into submission for our own good) is that this Carbon Cap-and-Trade idea isn’t going to cause that big of a problem, it’s all going to phase in and we’re only going to see minor increases in our energy bills to start out with. The Environmental Protection Agency (EPA) who really get into their full God-like control operation, if the legislation passes, have figured that in 2015 electric prices would probably only go up 10.7 percent, natural gas prices 7.4 percent and petroleum 3.2 percent. Yea, down the road when 2050 rolls around the estimates are a little higher for those energy costs (electricity 35.2 percent, natural gas 30.9 percent and petroleum 14.6 percent), but by then we will have adjusted and green energy will be so prevalent that you won’t be able to go anywhere without bumping into a Mother-Earth friendly windmill or solar panel. (This of course assumes that the environmental zealots and NIMBY crowd will allow for any of those energy-producing devices to be put anywhere.)
USDA’s Figuring:
The primary themes of the USDA analysis (based on our read of the Executive Summary, is that in the short-run 2012-2018 there’s not going to be much of a negative economic impact. This is mostly driven by the way the agency calculated the cost of fertilizer. Certain forms of popular fertilizers require a great deal of natural gas for their production and due to special dispensation that’s part of the House-passed version this natural gas use is not impacted by the heavy load of government taxation right off the bat.
As time goes on this special consideration goes away and there is a more full-force-and-effect impact, but again we’re not to worry because you’ve got those revenue producing carbon offsets going ching-ching in your bank account.
In simple form, as I understand it (so it really has to be very simple), the offset revenue stream will come in the form of farmers who plant trees (instead of other things) get paid by those doing some carbon polluting, but who can’t help themselves because it’s what they do. These carbon emitting entities would go to something like a stock-exchange and buy credits to offset the tax load they would be otherwise getting hit with. Those dollars would be used to pay agricultural producers for contracts of “carbon capture”, putting carbon into the soil through the trees they are growing or the changes that they make through minimum tillage practices.
It is interesting that the same financial derivative markets (and some of the same players) that got us into the economic woes we are facing on a world-wide basis are going to be the ones saving us and our planet by their operation of the financial markets that our federal government is working to create. Projecting the income stream under this economic model is about the same way that the University of Nevada’s economists calculated the economic benefits for producing alternative crops to justify purchasing water for Walker Lake…it’s based on the math formula of what do you need the answer to be? Then you come up with the estimates of income to get you to the answer.
Since there’s no accountability requirement to actually accomplish what your projections say will be the result – “just trust us” – the worse that could happen would be that they would be wrong and they can come back after the fact and say “oops, we didn’t realize that it was going to turn out this way” (see the justifications for the Stimulus Spending shortfalls).
It should also be noted that in the calculations by USDA, livestock producers aren’t going to fare all that well and none of the crop producers, who supposedly are going to do okay, aren’t raising crops that we grow in Nevada. Instead of growing crops that produce food, the solution is growing trees (nobody is going to use) in order to get money from a market-place run by those who have scammed us into the economic mess that’s got the whole world on the tipping point.
Yea, I guess they got things figured out pretty well…
We’ve all heard the expression that “figures never lie, but that doesn’t mean that liars don’t figure.” When the United States Department of Agriculture came out with their preliminary analysis of the effects of the House version of the climate change bill, the reports sounded like a new miracle cash crop was ready for banking – carbon credits.
The official line, coming from those associated with the current administration (which strongly supports expanding the federal government’s reach and taxing us into submission for our own good) is that this Carbon Cap-and-Trade idea isn’t going to cause that big of a problem, it’s all going to phase in and we’re only going to see minor increases in our energy bills to start out with. The Environmental Protection Agency (EPA) who really get into their full God-like control operation, if the legislation passes, have figured that in 2015 electric prices would probably only go up 10.7 percent, natural gas prices 7.4 percent and petroleum 3.2 percent. Yea, down the road when 2050 rolls around the estimates are a little higher for those energy costs (electricity 35.2 percent, natural gas 30.9 percent and petroleum 14.6 percent), but by then we will have adjusted and green energy will be so prevalent that you won’t be able to go anywhere without bumping into a Mother-Earth friendly windmill or solar panel. (This of course assumes that the environmental zealots and NIMBY crowd will allow for any of those energy-producing devices to be put anywhere.)
USDA’s Figuring:
The primary themes of the USDA analysis (based on our read of the Executive Summary, is that in the short-run 2012-2018 there’s not going to be much of a negative economic impact. This is mostly driven by the way the agency calculated the cost of fertilizer. Certain forms of popular fertilizers require a great deal of natural gas for their production and due to special dispensation that’s part of the House-passed version this natural gas use is not impacted by the heavy load of government taxation right off the bat.
As time goes on this special consideration goes away and there is a more full-force-and-effect impact, but again we’re not to worry because you’ve got those revenue producing carbon offsets going ching-ching in your bank account.
In simple form, as I understand it (so it really has to be very simple), the offset revenue stream will come in the form of farmers who plant trees (instead of other things) get paid by those doing some carbon polluting, but who can’t help themselves because it’s what they do. These carbon emitting entities would go to something like a stock-exchange and buy credits to offset the tax load they would be otherwise getting hit with. Those dollars would be used to pay agricultural producers for contracts of “carbon capture”, putting carbon into the soil through the trees they are growing or the changes that they make through minimum tillage practices.
It is interesting that the same financial derivative markets (and some of the same players) that got us into the economic woes we are facing on a world-wide basis are going to be the ones saving us and our planet by their operation of the financial markets that our federal government is working to create. Projecting the income stream under this economic model is about the same way that the University of Nevada’s economists calculated the economic benefits for producing alternative crops to justify purchasing water for Walker Lake…it’s based on the math formula of what do you need the answer to be? Then you come up with the estimates of income to get you to the answer.
Since there’s no accountability requirement to actually accomplish what your projections say will be the result – “just trust us” – the worse that could happen would be that they would be wrong and they can come back after the fact and say “oops, we didn’t realize that it was going to turn out this way” (see the justifications for the Stimulus Spending shortfalls).
It should also be noted that in the calculations by USDA, livestock producers aren’t going to fare all that well and none of the crop producers, who supposedly are going to do okay, aren’t raising crops that we grow in Nevada. Instead of growing crops that produce food, the solution is growing trees (nobody is going to use) in order to get money from a market-place run by those who have scammed us into the economic mess that’s got the whole world on the tipping point.
Yea, I guess they got things figured out pretty well…
Posted by Doug Busselman at 7/25/2009 5:58 AM 
Categories: Climate Change
Tags: Carbon Offsets Cap-and-Trade Global Warming Agriculture
Categories: Climate Change
Tags: Carbon Offsets Cap-and-Trade Global Warming Agriculture
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