Sunday, May 31, 2009


They’re back. Rising gasoline prices, that is. Millions of Americans hitting the roads over Memorial Day weekend faced prices for regular gas averaging $2.35 per gallon, a full 30 cents higher than at the beginning of the month and nearly 60 cents more than at the start of the year.

But don’t expect any help from Congress. In fact, Washington is working on a bill that would raise costs further.

The proposed American Clean Energy and Security Act of 2009 - introduced by Democratic Reps. Henry A. Waxman of California and Edward J. Markey of Massachusetts - essentially would limit how much gasoline and other fossil fuels Americans can use. The aim is to cut our emissions of carbon dioxide from energy use, which proponents of the bill claim is warming the planet to dangerous levels. Under this proposal, prices would have to rise high enough so the public would be forced to drive less and meet the ever-tightening energy rationing targets.

How high? A Heritage Foundation analysis estimates gasoline costs will rise $118 annually for a typical four-person household once the bill’s provisions take effect in 2012. That’s about 10 cents more per gallon - on top of anything else that might boost pump prices by then. And the impact goes up as the bill demands tougher energy use restrictions each year, tacking on an additional $1.23 to the inflation-adjusted price per gallon by 2035.

Electricity is also hit hard. In fact, the main target of the bill is coal, which affordably provides 50 percent of America’s electricity - for now.

The bill likely would reduce coal use and replace it with more expensive options for producing electricity. The costs would filter down to consumers and boost electric bills by $235 in 2012, rising to $468 by 2035. That’s a 90 percent increase over current rates.

Motorists and homeowners aren’t the only ones to be hurt by the higher energy costs. The bill also would cost jobs, especially in the manufacturing sector. The Heritage Foundation estimates more than 1 million lost jobs - some destroyed entirely and others shifted to nations like China that have made clear that they will never impose any energy-price-boosting global-warming measures on themselves. Call it environmental outsourcing.

Overall, the Waxman-Markey proposal would significantly raise pump prices and electricity bills. This is a regressive tax that would harm the working poor the most. At the same time, it would leave a million or more people without a paycheck to deal with the higher costs.

Is all this economic pain justified by the environmental gain? Even assuming the worst of global warming - and growing scientific evidence is turning sharply away from this assumption - the Waxman- Markey bill would make little or no difference.

China alone out-emits the United States, and its emissions are rising six times faster than ours. For this reason, unilateral measures are practically useless. According to climate scientist Chip Knappenberger with New Hope Environmental Services, “the bill will have virtually no impact on the future course of the Earth’s climate.” Even most proponents of the bill don’t dispute this point.

Though the pain at the pump is still well below 2008 levels - this time last year, prices were reaching $4 per gallon - there is no room for complacency or for piling on costly green measures. The only reason for the price decline since last summer was a drop in demand because of the recession. But recessions don’t last forever. Indeed, the fact that oil and gasoline prices are creeping back up suggests a turnaround is near.

In any event, a return to record gas prices is likely in the not-too-distant future. If Washington decides to make things worse by enacting this ill-advised global-warming measure, we may see future Memorial Day weekends with gasoline prices of $5 or even $6 a gallon - at least for those who can still afford to drive.

Ben Lieberman is a senior policy analyst in the Thomas A. Roe Institute for Economic Policy Studies at the Heritage Foundation (

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