Friday, June 5, 2009

Cap and Trade - Updated

Link - "Climate Bill a Pain in the Gas"

Even if you click this link and think "oh gawd, that's on politico.com, I am not going to read that garbage", just think of it for yourself. When gas prices go up for an extended period of time, do you notice that the prices of some goods go up as well? Such as a 4 liters of milk going up to over $5 in some places last year (it did in my city)? Then once the prices settled back down, milk was magically back to $4 or so? Okay then think about cap and trade. Start at the bottom - the oil companies get hit with higher costs, so who do they pass that onto? Fuel companies get hit with higher costs on top of that and put the excess onto whom? Trucking companies who bring goods to stores charge more because their fuels are costing more, and that goes onto whom? Stores pay more for their goods to be delivered so the cost increases to protect their profits. Who is going to pay for that? YOU are. It's pretty simple and easy to think through once you open your mind and think about everything that is going to increase in price for the consumer. Is every company going to absorb their own increases and take lower profits and/or pay their workers less? Highly doubtful, don't you think? Who would want to do that? So YOU are going to pay for it and if you can't figure that out yourself, take a look at the article and see if that helps you. But I don't think you need someone else to tell you what is going to be happening over the next few years and beyond....

UPDATE: From the president's mouth. I have seen this clip before and another version also goes on to show him saying that the coal industry could go bankrupt. He told you about these plans himself, so why don't you believe it when others talk about it???????? Seriously...... I don't get that. This vid has been going around for about 6 months, so many of you have seen it. And that's okay - I just think a little reminder is in order from time to time. So many seem to have short memories.


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And In Other News....
British Columbia Mayors pass 'Buy Canadian' resolution... let more fun games begin.

5 comments:

  1. The situation as described is reasonably accurate when one assumes that the costs from the principal producer is passed on as a direct cost increase. The problem is that there is a cost multiplier at every step of any process.
    Assume the following for example: each handler of the product operates at a 10% markup on costs and each handler also gets hit with a 10% increase in costs to cover their emissions. Also, assume that a single barrel of oil from the oilsands gets tagged with a $1.00 per barrel cost.
    From the oilsands extraction plant the $1.00 increase is added to the cost to the refiner. To this, add an addition 10% for the refiners cap & trade cost which means that barrel of oil now costs $1.00 + 10% + 10% in markup and the selling price from the refiner is now $1.21 higher than previously.
    From there the refiner ships part of that barrel to a polyethylene producer who is now hit with a 21% increase. To this is added the cost for emissions from this producer plus the 10% markup. From there the pelletized polyethylene goes to another processor remelts the plastic and uses it to coat electrical wiring. This processor also gets hit with the increased purchasing cost but is also required to pay a 10% tariff due to cap & trade and also adds a 10% markup. The original $1.00 a barrel cost has now escalated until it has nearly doubled by the time the consumer gets the product. This is to say nothing of the added costs for copper due to cap & trade penalties or the increased cost of shipping.
    This is not to say that the final price to the consumer will double since a barrel of oil produces only a small proportion of ethylene, but it is indicative of how the multiplier effect will be felt at every step of the processing of the original barrel of oil. While the price of individual items will increase only slightly, the overall effect will be to have this increased cost make a cumulative price increase substantial.

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  2. Thank you for putting this into more detail. The way I look at it, even if goods and services only appear to increase in cost slightly for consumers, when you add up the grand total at the end of each month and year, it is quite substantial. And low income families are going to feel the hit just as hard or harder than anyone else, but they are being led to believe the govt has their best interests at heart.

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  3. A less disingenuous title for this hidden tax grab would be “Cap, Tax & Trade”. At least Dion was honest enough to call his carbon tax a tax.

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  4. Yes that's true lol.

    I would like to place an order for some of this global warming though - I would like a little bit over here please! It's June 6th and two days ago it was 27C, giving my a nice sunburn too - and right now I am staring out my window at SNOW.

    Snow that is even sticking to the ground! Snow that is freezing on the previously-warmed-up trees and making them sag to the ground. What's this? The cold air is killing plant life? One apple tree won't produce already this year due to frost bite, the poor thing. Now the problem could be more wide-spread.

    What did our weather forecasters say? Oh that's right, RAIN. Not snow. RAIN. But I am supposed to believe someone that tells me what weather is going to be like in 100 years, when no one can tell me what it's going to be like this afternoon with any real certainty.

    And pay through the nose to support the unproven theory on top! Oh what a joyously free world we now live in.

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  5. Good post Kez - a timely reminder, particularly as we enjoy our June snow in this period of unprecidented "warming".

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