Friday, May 14, 2010

Will Congress Create Another Economic Bubble?

Tom Borelli of the National Center for Public Policy Research's Free Enterprise Project and Stuart Varney of Varney & Co. on Fox discuss one of the bigger downsides of a cap-and-trade plan -- the possibility that the whole thing will come crashing down at some future point, harming (often innocent, or at least, naive) investors in the process.

Carbon dioxide has no economic value now. If cap-and-trade is adopted, the government will be placing upon it an artificial value. We already know companies will line up to invest in it, as GE, Goldman Sachs, Duke Energy and others have been lobbying to make certain any cap-and-trade bill Congress adopts has terms favorable (at least temporarily) to them. But at some future date, Congress will change its mind about cap-and-trade, Carbon dioxide will become valueless. Who will be left holding the bag?

Small investors who invested their retirement money, perhaps?

For more about Tom Borelli's work, including other videos, go here.

1 comment:

FriedGreenWhat? said...

Your pleas will fall on deaf ears when it comes to the lobbyists but maybe Tom Borelli will save a few investors. NO CARBON CAPS!!!!