GOP wrong about impact of cap-and-trade bill supported by Chandler

The Herald-Leader will routinely check the accuracy of statements made by candidates and their surrogates leading up to the Nov. 6 election.

The statement: "Ben Chandler's vote for Obama's 'cap and trade' bill would raise taxes on every American household by $1,761."

— Republican Party of Kentucky mailer sent to Central Kentucky homes

The ruling: False.

The facts: U.S. Rep. Ben Chandler, D-Versailles, faces Republican Andy Barr, a Lexington lawyer, in the Nov. 6 election.

In 2009, President Barack Obama proposed a cap-and-trade plan — a compromise between free-market conservatives and environmentalists — to deal with the emission of carbon dioxide and other greenhouse gases that scientists say contribute to climate change.

The plan would have set a cap on emissions, forcing utility companies to upgrade to cleaner technologies or buy permits from the government to continue polluting. The utilities' increased cost ultimately would be passed to consumers.

The state Republican Party's claim about Chandler falls short in several ways.

One, Chandler didn't vote for Obama's plan, introduced in February 2009. Chandler and most other House Democrats voted for a competing proposal, the American Clean Energy and Security Act, sponsored by U.S. Rep. Henry Waxman, D-Calif. The House approved Waxman's bill on June 26, 2009, though it died in the Senate and never became law. Obama and Waxman had different ideas, such as whether emission permits should be auctioned.

Two, Obama's plan wouldn't have raised taxes on every American household by $1,761. To support that allegation, the Republican Party cites a Sept. 15, 2009, blog post on the CBS News Web site. The blog post, in turn, cited a U.S. Treasury Department memo from March 2009 that estimated federal revenue from Obama's plan would be between $100 billion to $200 billion a year.

The Treasury memo never mentioned a $1,761 tax increase. The blogger said he did the math himself, dividing the upper-most $200 billion figure by the number of American households and declaring it the financial equivalent of a $1,761 tax hike per household.

The blog post quickly was criticized for, among other things, failing to account for the tax cuts that Obama's plan would have given Americans using much of the new revenue, which would help offset their higher utility bills.

"It only looks at one side of the balance sheet," the Environmental Defense Fund said of the blog post at the time. "It would only be true if you think the administration was going to pile all the cash on the White House lawn and set it on fire."

Three, the Waxman bill Chandler voted for would have eventually, by the year 2020, led to an average net cost of about $175 per household annually, according to a June 2009 analysis by the nonpartisan Congressional Budget Office. That's less than one-tenth the sum the Republican Party alleges.

However, that's just the average. Because of how the Waxman bill would have returned some of the revenue to consumers through progressive tax cuts, rebates and other benefits, the lowest-income households would have seen a net return of $40 per year while the highest-income households would have seen a net cost of $245 per year, the CBO said.

Campaign Watchdog finds the Republican Party's claim to be false. It relies on bad math and blames Chandler for a plan for which he didn't vote.