May 11 2009
WASHINGTON, DC – U.S. Senator Pat Roberts said Kansas has much to lose under cap and trade proposals. At a hearing of the Senate Committee on Finance yesterday, Senator Roberts made the following remarks:
"Kansas has a lot to lose under this cap-and-tax scheme and not much to gain.
"Many of you have heard me say over and over again, cattle out number people two to one and over 70 percent of the energy consumed by Kansans is generated by coal fired power plants. Furthermore, Wichita is a major manufacturing city, you may know it as the Air Capital of the world.
"Hundreds of small, rural communities dot the Kansas prairie and also have energy intensive industries that keep the local economy above water, the community banks investing, and the American dream a reality.
"Unfortunately, proposals like cap-and-tax or a plain and simple energy consumption tax don’t make many back home happy.
"Earlier this week I met with the Chairman, President, and Vice President of a small independent oil and gas refining company that supplies parts of rural America. Companies such as this make up 13 percent of U.S. refining capacity. There are approximately 30 small refiners across the country. These folks told me that a cap and tax system such as the one being considered in the House, if passed, would cause them to shut their doors on day one. This is not how we want to treat domestic small businesses that are the lifeblood of rural America and supply a critical portion of our energy demand.
"You see, as soon as Mother Nature cooperates, Kansas farmers, whom each feed 145 people across the world, will begin their spring planting.
"During last years’ global warming debate, I asked K-State Research and Extension to run an economic analysis of what cap-and-tax means. The response I received was frightening.
"The cost of production for one acre of irrigated corn increased over $100, an acre of wheat roughly $25 and an acre of sorghum $30.
"Parlay this into the increased energy costs for transportation, refrigeration and storage and you can imagine how much more disposable income the consumer will be forced to use just to purchase food and fiber?
"Add the additional tax increase for your electric bill and vehicle fuel and you aren’t left with much in your pocket book.
"In fact, about the only winner out of this scenario is the federal government. And I think that is the point that needs to be made. Every cap-and-trade proposal that I have seen, is at its core a way to tax energy consumption. It is a way to bring more revenue to the federal government.
"Now I am glad that this committee, with jurisdiction over tax issues, has decided to hold a hearing. I have concerns that while cap and trade may create new green jobs, is it merely shifting those existing jobs within the energy sector and forcing these small businesses out of business?"
Senator Roberts is a member of the Senate Committee on Finance and a senior member of the Senate Committee on Agriculture, Nutrition and Forestry. He has introduced legislation to intensify research into the link between agricultural practices and climate with a focus on carbon sequestration.