RGGI Rip-Off: Cap-and-Trade Tax Fueling The 1%
By Mel Fabrikant Saturday, March 08 2014 @ 10:45 AM EST
Speculators Ramp Up Exploitation of Artificial Carbon Market on Backs of Ratepayers
The latest auction of carbon allowances by the secretive Regional Greenhouse Gas Initiative, aka RGGI, confirms what Americans for Prosperity has long-since warned: the cap-and-trade scheme is being exploited by speculators and Wall Street firms on the backs of ratepayers.
“Environmentalists and supporters of the RGGI Cap-and-Trade scheme are being duped right before our eyes,” charged AFP spokesman Mike Proto. “They’re supporting a scam that allows speculators and Wall Street firms to enrich themselves off of ratepayers. I never thought I’d see that day when environmentalists would be supporting a program that taxes the little guy while allowing speculators to reap windfall profits, but that’s exactly what’s happening.”
A 2010 New Jersey Watchdog exposé noted that “Goldman Sachs, Morgan Stanley, Merrill Lynch, JPMorgan Chase and other Wall Street heavyweights” were active bidders at RGGI auctions. During RGGI’s first 21 auctions, only 19% of RGGI’s carbon permits were won by “Non-Compliance Entities”, which include these firms. Since RGGI announced last year the cap would be lowered by a staggering 45%, the results have been in stark contrast:
• Auction 22 (December, 2013) resulted in 57% of the permits being secured by Non-Compliance Entities
• Auction 23 (March, 2014), the first with the more stringent cap in full effect, resulted in 55% of the permits being secured by Non-Compliance Entities
“Now that the RGGI bureaucrats have ratcheted down the cap, speculators are jumping into the market in a big way,” said Proto. “One doesn’t have to be Warren Buffet to figure out that this is an easy money-making opportunity. Investors can hoard these allowances now, bank them and look to sell them at enormous profits down the road. A good deal if you’re an insider—but a blatant rip-off of consumers who will see their electricity bills go up to pay for it,” added Proto.
Americans for Prosperity is once again praising Gov. Christie’s decision to withdraw from the Regional Greenhouse Gas Initiative Cap-and-Trade scheme.
“Governor Christie did the right thing in pulling New Jersey out of the RGGI scam when he did. He’s spared New Jersey ratepayers from the coming rate hikes caused by the drastic lowering of the RGGI cap. The more stringent cap has already caused prices to double and that will hit ratepayers in the remaining nine RGGI states hard.”