California is ready to launch into biggest financial scam ever concocted: cap and trade—more accurately known as, “cap and tax.” The Golden State will be home to North America’s first full-scale carbon market, where an invisible, miniscule component of the earth’s atmosphere—carbon dioxide—will be traded as a commodity.
The people of California are about to be taken like a sucker in a street corner game of Three Card Monte.
Last week the honchos at the California Air Resources Board conducted a full-scale practice run of the trading process for carbon dioxide (CO2). State officials claim the trial was a grand success.
It’s as if the people of California are characters from Hans Christian Anderson’s classic, The Emperor’s New Clothes. They’re allowing government bureaucrats to institute the trading of a “commodity” that no one is able to see , touch , taste or smell. Cap and trade provides an outrageous opportunity for the state to steal from businesses, sock it to the consumer, expand the welfare rolls, and reward cronies—all in the name of being green.
Under the cap and trade law, which takes effect in January, annual greenhouse gas emissions from California’s factories, power plants and oil refineries are limited—that’s the “cap.” If a company exceeds their cap they must purchase credits from the certified carbon exchange. If a company remains under their annual cap, they will receive “carbon credits,” which they may save or sell.
Saved credits can be used by a company to pay for, or “offset,” future emission overages. The credits can be sold, for a profit, to other companies struggling to stay below their cap. Savvy, authorized, investors are also able to get in on trading the faux commodity and make big bucks in the process.
This will be a very lucrative money-raising venture for California. The state estimates that by 2013 it will earn as much as $3 billion annually from the plan. By 2020 carbon trading could bring in up to $20 billion per year because the emission caps lower over time, the price of allowances increase, and additional business sectors will be mandated to participate.
California officials have stated they will likely use a portion of the new revenue to provide subsidies to poorer residents so they are able to pay their inflated energy bills.
As such, the cost of doing business is going to rise dramatically in California with the first noted increase for the consumer coming in the form of higher electricity, heating, cooling, gasoline and diesel costs. Those price hikes will be felt immediately.
By the way, the designated bank used for all trades is Germany heavyweight, Duetsche Bank. How’s that for being bullish on America? It’s also an odd pick given that Duetsche Bank was one of the primary drivers of the credit housing bubble which burst in 2008, sinking the U.S. into recession. From as late as 2001 to at least 2007, the Bank engaged in covert espionage on its critics. Deutsche Bank will skim off of every trade made. One has to wonder what type of cronyism was involved in selecting this operation to hold all the money in California’s cap and trade kitty?
From a scientific standpoint it’s astounding to note that, of all the gases in our atmosphere, the amount of CO2 is almost imperceptible. Carbon dioxide is a greenhouse gas—and this is why it’s become demonized. Whenever fossil fuels such as coal, oil, or natural gas are consumed, their byproduct is CO2. The global warming theory is that increased amounts of carbon dioxide trap heat—like a greenhouse—and cause the atmosphere to warm and the climate to change. However, there are numerous problems with that theory.
While the primary gases, nitrogen and oxygen, account for 78 percent and 21 percent respectively, CO2 makes up only .038 percent; that’s 38/1000ths of 1 percent of all atmospheric gases. However, despite being a trace gas, it’s a component that is vital for the existence of life. For example, carbon dioxide is key to the process of photosynthesis in plants. CO2 is also a variable gas; throughout time its amount has always varied. For example, in the Eocene period (50 million years ago) carbon dioxide was likely six times higher than today. In the Cretaceous period (90 million years ago) it was as much as seven times higher than today; and in the Carboniferous period (340 million years ago), CO2 is thought to have been nearly 12 times that of current levels. Many surmise dinosaurs were able to grow to such monstrous sizes because of the indescribable abundance of foliage fed by the heightened levels of CO2 present during their era.
I repeat: carbon dioxide accounts for a mere 38/1000ths of 1 percent of all atmospheric gases. And of this trace amount of gas, human activity is responsible for 3.207 percent (according to the U.S. Department of Energy.) CO2 is also a known to be lagging indicator of atmospheric warming, not a leading one. So, when environmentalists tell us that they estimate the amount of atmospheric carbon dioxide has risen 35 percent since 1850, it must be noted that the increase followed the end of a 450-year cool spell known as The Little Ice Age. As the temperature warmed, CO2 levels increased.
Let’s be clear about this: cap and trade, has nothing to do with stopping global warming. It’s a plan to destroy the American lifestyle, control markets, kill capitalism, redistribute wealth and reward cronies. It shouldn’t surprise you that this is an idea first proposed by elitist masterminds at the United Nations. California’s utopian-minded leaders decided they would show the rest of the U.S. the way.
Because cap and trade will increase the cost of energy, eventually (as I explain in Eco-Tyranny) people will give up on living in larger homes—the electric and heating bills will just be too high too handle. Since there is no plan for additional base-load electrical generation plants in California, the only plan is to force residents to use less energy. Therefore the goal is to coerce residents into small townhouses, compact condos, and tiny apartments. Eventually, with exorbitantly higher gasoline prices, residents will be forced out of their automobiles and into mass transit accommodations.
In time many people will leave impoverished areas of California behind and migrate to other states. The San Francisco Bay Area, Los Angeles, and Sacramento will remain intact, with most of the remainder of the state returning “back to nature,” void of farms, ranches, and small rural towns and outposts.
If you want to know how ineffective these carbon scheme are, just look at the financially failed European Union. They launched their carbon market in 2005. As of the end of last year, Swiss banking giant UBS said the Union’s trading program had cost consumers $287 billion and had “zero impact” on cutting carbon emissions.
Brace yourself Mr. and Mrs. California. Like it or not, come January you’re going to be know what being green is really all about.
Brian Sussman is an award-wining television meteorologist and author of “Climategate” and “Eco-Tyranny.” He also hosts the most popular morning radio talk show in San Francisco, heard on KSFO.
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