Free-market think tank sues Treasury Dept. for withholding internal carbon tax documents

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Michael Bastasch DCNF Managing Editor
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On Monday, the Competitive Enterprise Institute announced it had filed a lawsuit against the Treasury Department to compel them to “stop stonewalling” and release internal documents related to plans for a “possible effort” to enact a carbon tax during Congress’ lame-duck session this fall.

“Plans for post-election tax hikes are precisely the type issue that taxpayers deserve to have discussed openly, pre-election,” Chris Horner, CEI senior fellow and author of “The Liberal War on Transparency,” told the Daily Caller News Foundation.

Detecting a concerted effort to pass a carbon tax, CEI filed a Freedom of Information Act request on August 8 with the Treasury Department Office of the Deputy Secretary for Environment and Energy and also with the Office of Legislative Affairs, asking for “deliberations pertaining to the carbon tax.”

“Despite President Barack Obama’s repeated promises for openness and transparency in government, the Treasury Department failed to even acknowledge CEI’s FOIA request as required by law.” wrote Horner.

“This is an unusual step given the tools available to delay producing records typically invoked only for the most inconvenient requests for records,” Horner continued.

In early August, Washington Democrat Rep. Jim McDermott introduced a carbon tax bill, the Managed Carbon Price Act of 2012, to reduce CO2 emissions by 80% of 2005 levels within 42 years of the bill being enacted.

“The American people care about the deficit and they’re worried about climate change–and we can fix both  without hurting the economy,” McDermott said in a statement.

The first price on greenhouse gas substances will start 2 years after the bill’s passage, to allow industry to prepare. It also requires the Treasury Secretary to sell emissions permits, which can only be be bought or refunded from the Treasury, and can’t be traded.

A recent Brookings Institution report said if the starting price were set at $15 per ton, an estimated $80 billion could be raised, rising to $170 billion in 2030 and $310 billion by 2050.

“Mitt Romney’s Economic Advisor Greg Mankiw, Exxon-Mobil, the American Enterprise Institute and other conservatives have backed this concept because they know we have to wean ourselves off of carbon emitting energy sources, and do it in a way that doesn’t hurt our economy and makes sense for businesses,” McDermott added in his statement.

Democrat Senate Majority Leader Harry Reid of Nevada also expressed hope that the Senate would take up the issue as well.

A carbon tax has reportedly been gaining popularity in some conservative circles, including a new group launched in July by former South Carolina Republican Rep. Bob Inglis aimed at promoting the idea of a revenue-neutral tax on carbon on the right.

“What we have been doing so far is sort of shrinking in science denial and holding onto shaky ideology that really will be overwhelmed by the facts,” Inglis said in an interview.

However, many on the right still oppose a tax on carbon emissions, with CEI being among the most vocal.

“They’re looking at a European-style VAT or carbon tax to underwrite their vision of a society admittedly modelled after Europe,” Horner told the DC News Foundation.

“It’s hard to believe that Democrats in Washington are introducing an energy tax on consumers, especially as Americans are out of work and the economy remains sluggish,” Oklahoma Republican Senator James Inhofe said about McDermott’s carbon tax bill.

“It’s time for my friends on the other side of the aisle finally to get through the grieving process on cap-and-trade, move on from these failed, dead policies, and begin to embrace the enormous potential of America’s abundant energy resources,” Inhofe continued.

Even a coauthor of an AEI study done in 2007 on the possibilities of a revenue-neutral carbon tax has changed his mind on the issue.

AEI Resident Scholar, Kenneth P. Green wrote, “[M]y views on the carbon tax have evolved: I no longer believe that such a tax (or, for that matter, other eco-taxes) can be implemented in the sort of ideal, economically beneficent way that people favoring individual liberty, free markets, or limited government might sanction.”

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