An Economic Declaration of War

There is a war brewing between liberals on Capitol Hill and the hardworking citizens of the Midwest, notably those of my home state of Indiana.

It comes in the form of an energy proposal known as “cap and trade” which would cap greenhouse gas emissions from regulated entities and require businesses to acquire permits or “allowances” for their emissions. The bill should actually be called “cap and tax” because it basically establishes a national energy tax. Under the guise of protecting the environment, the bill will increase taxes on every American who uses any form of energy and would have a devastating impact on the Indiana economy and Hoosier taxpayers. Washington politicians love it because they can claim that they are taxing polluters when in effect they are actually taxing middle class American families and workers.

The Wall Street Journal recently editorialized about this proposal, noting the unjust burden this proposal would have on the Midwest: “But the greatest inequities are geographic and would be imposed on the parts of the U.S. that rely most on manufacturing or fossil fuels — particularly coal, which generates most power in the Midwest, Southern and Plains states… Coal provides more than half of U.S. electricity, and 25 states get more than 50% of their electricity from conventional coal-fired generation.”

Indiana, in particular, would be one of the hardest hit states in the nation because it gets 94 percent of its energy from fossil fuels.

Let me be clear: cap and tax is a job killer.

With small businesses and factories being forced to cut jobs or close their doors, more Americans will be out of work and unable to support their families. Those few businesses and factories that manage to stay open will only do so by passing their increased energy costs on to consumers.

President Obama himself admitted that the plan will cause energy prices to rise at the expense of the consumer. In an editorial board meeting with the San Francisco Chronicle during the presidential campaign he stated, “Under my plan of a cap and trade system electricity rates would necessarily skyrocket … that will cost money. They will pass that money on to consumers…”

The effect of this massive tax increase will be felt by every American. According to cost analysis of similar cap and tax proposals, the total energy bill for the average American household will increase by more than $3,000 per year. At a time when families across the heartland and across America are hurting, the last thing they need is to be burdened with even more punishing taxes.

As Chairman of the Republican American Energy Solutions Group in the U.S. House, we will be conducting hearings across the country. The purpose of the group is to study and propose ways that we can work together to increase American energy production, encourage greater efficiency and conservation, and promote the use of alternative fuels. Together we can find common ground in our battle for energy independence without placing an additional burden on American consumers.