The cap and trade redistribution begins
Last Thursday Maryland utilities were among those bidding to pay for the privilege of creating and/or supplying electricity and natural gas. The first Regional Greenhouse Gas Initiative auction netted a total of $38,575,783 to be divided by the six states offering these allowances. Man, you talk about suckers.
On the other hand, perhaps I’m being too hard on the utilities and other bidders because the sole reason this auction occurred is because these respective state legislators were seduced by the twin thoughts of appearing to address the phantom problem of manmade global warming while adding a few dollars to their state treasuries - without overtly raising taxes. (Never mind that these utilities need to get that money back somehow – unfortunately for them they have far fewer methods to raise the revenue to maintain their own profitability.)
So where will this $38 million go to? I’m sure a piece of Maryland’s ill-gotten gains will go to replenish a program which was stiffed in the state budget, the grant program for solar and geothermal energy. Most of the rest will disappear into the maw of Maryland’s Strategic Energy Investment Fund as detailed (look around page 7) in Maryland law. (As it stands, we might get a quarter back on our electric bill. Woohoo!)
Of course, much of our booty is targeted toward low- and moderate-income homeowners. Certainly they could use the help but I’ve never seen the idea of redistribution from a private corporation through a governmental entity (who naturally gets their cut) to a targeted group as one which provides either efficiency or incentive for betterment of the lower class. But it sure provides votes to the elected officials who love nothing better than spreading the largesse around.
This is the first of what should be a quarterly series of RGGI auctions, the next one will occur in December. In an era where financial providers got in huge trouble from buying and selling a somewhat tangible asset like real estate, it’s mind-boggling to sell allowances to be allowed to create something that we humans naturally exhale. But that’s the way of the world these days, and another item which needs to be addressed in order to reestablish government in its proper role.
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