Recent Policy Studies

• Natural Resources, Energy, Environment, & Science
  

  State’s New Energy Regulations Would Increase Costs for Homeowners

  By Brandon Houskeeper, Washington Policy Center
  
  Environmental Watch, 07/26/2010
  

  Washington State’s new energy regulation would increase homeowners’ costs by adding over $2,200 to the cost of a new home and more than $2,000 for remodels. Washington’s State Building Code Council is currently accepting public testimony on whether or not to impose their new energy rules. The Council should cancel its proposed rules, because any supposed benefit to the environment is minimal compared to the high cost it would impose on new and existing homeowners in the state of Washington. However, should the Council move to implement these onerous rules, Governor Gregoire and other policymakers should require a complete cost-benefit analysis, including a Small Business Impact Statement that meets the requirements in state law. Additionally, the state should adopt standards by which Washingtonians are reducing carbon emissions in the most efficient and cost effective ways. Finally, Governor Gregoire should articulate the serious questions that she believes need to be answered, as raised by her June 8th letter.

  
  
  
• Budget & Taxation
  

  Sales Tax Holidays: Politically Expedient but Poor Tax Policy

  By Mark Robyn, Micah Cohen, Joseph Henchman, Tax Foundation
  
  Special Report, 07/26/2010
  

  Sales tax holidays are periods of time when selected goods are exempted from state (and sometimes local) sales taxes. Such holidays have become an annual event in many states, with exemptions for such targeted products as back-to-school supplies, clothing, computers, hurricane preparedness supplies, products bearing the U.S. government's Energy Star label, and even guns. High-tax New York State sparked the trend in 1997 as a way to discourage border shopping. In 2010, 18 states will conduct sales tax holidays. At first glance, sales tax holidays seem like great policy. They enjoy broad political support, with backers arguing that holidays are a highly visible form of tax cut and provide benefits to low-income consumers. Politicians and other supporters routinely claim that sales tax holidays improve sales for retailers, create jobs, and promote economic growth.

  
  
  
• Budget & Taxation
  

  How the Death Tax Kills Small Businesses, Communities—and Civil Society

  By Patrick Fagan, The Heritage Foundation
  
  Backgrounder, 07/26/2010
  

  The death tax generates about 1 percent of federal revenues. By generating that small a benefit to the federal treasury, the death tax discourages investment and savings, undermines job creation, suppresses productivity and wage growth, hurts those whose savings are tied up in land, hurts businesses owned by families, women, and minorities, and contradicts the American ideal of wealth creation. Perhaps worst of all, in threatening small businesses, the death tax threatens activities that are essential to the moral fabric of American life.

  
  
  
• National Security
  

  The Making of the Christmas Day Bomber

  By Alexander Meleagrou-Hitchens, Jacob Amis, Hudson Institute
  
  Current Trends in Islamist Ideology, 07/26/2010
  

  Like many of his predecessors, Umar Farouk Abdulmutallab, the “Christmas Day Bomber,” left behind a personal testimony. His was not a scripted “martyrdom video,” but a series of online postings written over the course of two years. They relate a dramatic journey, born of a web of influences. Within a few months of his first Internet writings, Abdulmutallab, already flushed with Salafist religiosity, encountered the highly politicized Islam that is prevalent on the British university campus. The organizations and institutions with which he interacted, as a member and then president of University College London’s Islamic Society, openly promulgated a radical worldview: the “War on Terror” is in fact a “War on Islam,” resisted by the freedom fighters of Hamas, Hezbollah and the Taliban, in a valiant defensive jihad. For some, this heroic mantle could extend, with only subtle qualification, to the offensive jihad of al-Qaeda.

  
  
  
• Health Care
  

  Why the Obama Health Plan is Not Entitlement Reform

  By James C. Capretta, Galen Institute
  
  Studies, 07/26/2010
  

  President Obama passed his health care program through Congress in large part based on the argument that it represented a clear break from past practice. The bill expanded entitlement spending to millions of new beneficiaries and the architects contend that it will also slow the pace of rising health costs. The new law provides the possibility of swifter implementation, but the political and information obstacles that have always stymied progress in the past remain. A more promising approach for addressing the significant challenges we face is a completely new relationship between the government and the beneficiaries of its programs. In particular, in Medicare, the key to changing the cost dynamic is to give more power and control to the beneficiaries themselves. Their choices can lead the health sector to make the revolutionary and cost-cutting changes the government has never been able to successfully impose by regulatory fiat.

  
  
  
• Education
  

  Reform with Results: What Oklahoma Can Learn from Florida’s 12-K Revolution

  By Matthew Ladner, Friedman Foundation for Educational Choice
  
  Research Study, 07/26/2010
  

  Florida lawmakers began a comprehensive education reform effort in 1999 combining accountability, transparency, and parental choice with other far-reaching changes. In March 2010, the National Assessment of Educational Progress (NAEP) released new results showing just how successful Florida’s reforms have been and how futile Oklahoma’s efforts have proved. This study documents how the latest NAEP results strengthen the case for Florida-style reforms. Florida’s reforms, while benefiting all students, have been especially beneficial to disadvantaged students. This paper details the key components of Florida’s K-12 education reform strategy and explains why the adoption of the Florida reforms in Oklahoma would aid all children, especially disadvantaged students.

  
  
  
• Health Care
  

  The CLASS Act: Repeal Now, or Face Permanent Taxpayer Bailout Later

  By James C. Capretta, Brian Riedl, The Heritage Foundation
  
  Backgrounder, 07/26/2010
  

  Proponents of the new health law have claimed repeatedly that it will improve the nation’s long-term budget outlook. That is an illusion based on implausible assumptions, sleights of hand, and outright budget gimmicks, with the Community Living Assistance Services and Supports Act (CLASS) topping the list. The CLASS Act is an ill-conceived concept that was included in Obamacare only because of the appearance of surplus funding. In reality, CLASS is destined to run short of funds, creating pressure for another massive taxpayer bailout. The biggest threat to the long-term prosperity of the country is the massive unfunded liabilities for the nation’s major entitlement program. The last thing Congress should be doing is adding to the burden of future taxpayers, which is why CLASS Act repeal is the most fiscally responsible—and ethical—course to follow.

  
  
  
• Foreign Policy/International Affairs
  

  Panama and Obama’s Latin America Policy: Time to Close Ranks and Support a Friend

  By Ray Walser, The Heritage Foundation
  
  Backgrounder, 07/26/2010
  

  Panama, like its neighbor Colombia, is waiting for the U.S. Congress to approve the pending free trade agreement and to increase security cooperation. Panama is a strong democracy and trade partner often ignored in Washington, despite decades of fruitful ties. The cornerstone of the U.S.–Panama relationship remains the path-breaking 1970s treaties that granted Panama sovereignty over the U.S.-built Panama Canal, a historic milestone in the peaceful evolution of hemispheric diplomacy. The Panama Canal plays a prominent and growing role in U.S. trade. Panama is ready to deepen its long cooperation and friendship with the U.S.—it is time that Washington embrace this opportunity to strengthen a vital alliance.

  
  
  
• Foreign Policy/International Affairs
  

  Colombia and Obama’s Latin America Policy: Time to Close Ranks and Support a Friend

  By Ray Walser, The Heritage Foundation
  
  Backgrounder, 07/26/2010
  

  The decisive June 20 triumph of Juan Manuel Santos, elected as Colombia’s next president, is a victory for democracy, a vote for policy continuity, and a reaffirmation of the importance of a strong U.S.–Colombian relationship. On many fronts—from combating the drug trade and narco-terrorism to advancing citizen security and meeting human needs—the U.S. and Colombia have achieved an unprecedented level of cooperation over the past decade. The time has come for the Obama Administration to aggressively push for immediate legislative approval of the free-trade aggreement with Colombia. It must make the case that trade union and human rights issues in Colombia will be addressed through active partnership with a shared review process rather than by denying the much-needed free-trade deal and demanding perfection on the human rights front. Protecting human rights, reducing criminal threats to security and reducing the threat of illicit drug trafficking go hand in hand and require well-coordinated, long-term strategies that link citizen security with the economic opportunities that come with trade, investment, and market access.

  
  
  
• International Trade/Finance
  

  The “Beijing Consensus” in Energy and the Environment

  By Derek Scissors, The Heritage Foundation
  
  WebMemo, 07/26/2010
  

  It is plain that a “Beijing Consensus” in energy and environmental issues would be disastrous. The world is struggling to accommodate one country following the PRC’s energy and environmental priorities—more would be that much worse. This potential calamity has particular implications for American policy. Chinese state intervention and, now, tens of billions of dollars in annual spending are consistent with an energy and environmental performance that is vastly inferior to that of the United States. Federal government tax and spending actions can certainly boost individual wind and solar companies but may harm the economy, make the U.S. less energy efficient than it otherwise would be, and do little for the environment. Rather than trying to match the various kinds of Chinese subsidies, as some green energy advocates suggest, the U.S. should start near the opposite pole of the Chinese model.

  
  
  
• Budget & Taxation
  

  New Jersey Teacher Salaries Are Comparable to Professional Pay in Private Sector

  By Marcus A. Winters, Manhattan Institute
  
  Issue Brief, 07/26/2010
  

  It is often said that public school teachers are poorly paid. At an average salary of about $60,000 a year, public school teachers in New Jersey take home substantially less pay than do many other college educated professionals. But teachers tend to work fewer hours in a year than do other professionals. Does the widespread assertion that New Jersey's teachers are poorly paid relative to other professionals hold true after accounting for differences in hours worked? When adjusted to equivalent working hours, it is found that New Jersey's public school teachers earn wages that are competitive with those of private-sector professionals, whose salaries have stagnated or been cut as a result of the recent economic downturn.

  
  
  
• Regulation & Deregulation
  

  Regulatory Takings: The Next Step in Protecting Property Rights in Texas

  By Ryan Brannan, Jay Wiley, Bill Peacock, Texas Public Policy Foundation
  
  Policy Perspective, 07/26/2010
  

  A full and objective examination of the Texas government regulation helps determine whether restrictions on private property owners are appropriate. This “look before you leap” approach is a valuable characteristic of good government. Future municipal development should be done wisely and transparently with a fair and reasonable recognition of the fundamental rights of private property owners. Since the Texas Supreme Court has held that the Private Property Rights Act of 1995 does not require a Takings Impact Assessment be performed, which examines the benefits, burdens and alternatives to regulation, it is an important part of reform legislation.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  The Economic Cost of a Moratorium on Offshore Oil and Gas Exploration to the Gulf Region

  By Joseph R. Mason, Institute for Energy Research
  
  07/26/2010
  

  The goal of the Obama administration moratorium is to shield the Gulf from further harmful effects by limiting the likelihood of a similar oil spill in the future. The moratorium, however, will do more harm than good. By ceasing offshore drilling, even for as little as six months, the moratorium will further depress onshore state and local economies dependent on oil production. Evidence indicates that the Deepwater Horizon spill was attributable to a lack of sufficient oversight during the transition of the rig from exploration to commercial production. Halting all offshore deepwater drilling in response to a likely low-probability event serves neither to address the root causes of the accident, nor to aid in the economic rehabilitation of the Gulf region. Indeed, a moratorium on offshore drilling would result in billions of dollars in additional lost economic activity in the Gulf.

  
  
  
• National Security
  

  The Civilian and the Military: A History of the American Antimilitarist Tradition

  By Arthur A. Ekirch, Jr., Independent Institute
  
  Book, 07/26/2010
  

  “Though involved in numerous wars, the United States has avoided becoming a militaristic nation, and the American people, though hardly pacifists, have been staunch opponents of militarism,” wrote the distinguished historian Arthur A. Ekirch, Jr., in his 1956 book, The Civilian and the Military. Subordinating the armed forces to civil rule is a tradition that is essential to the survival of freedom and democracy in America, according to Ekirch. Now with the Independent Institute’s reissue of this book—a companion to Ekirch’s recently reissued classic, The Decline of American Liberalism—a new generation of readers can discover the nature and importance of the antimilitarist tradition as it has played out from the Founding Era to the Cold War. As libertarian historian Ralph Raico explains in his new foreword, The Civilian and the Military traces the “portentous transformation” of the United States from a republic leery of maintaining its own standing army to “the world’s greatest military machine and sole imperial power.”

  
  
  
• Crime, Justice & the Law
  

  Federalizing Fiduciary Duties through Shareholder Lawsuits: Three Reasons for Court Scrutiny

  By William G. Lawlor, Michael L. Kichline, Michael J. Newman, Washington Legal Foundation
  
  Working Paper, 07/26/2010
  

  This working paper examines a phenomenon in corporate litigation that has largely escaped close study: the proliferation of “Caremark claims” – that is, derivative cases based on a corporate director’s fiduciary duty to monitor. Since the Caremark decision itself, courts have accepted the fundamental premise that state law fiduciary duty claims may be based on corporate violations of federal criminal law. “Federalized Caremark claims” deserve closer scrutiny for three reasons. First, the propriety of conflating state civil liability for breach of fiduciary duty with federal criminal statutes is, at best, questionable. Second, the calculation of harm to corporations in federalized Caremark claims has escaped thorough analysis, allowing potential manipulation by the plaintiffs’ bar. Finally, federalized Caremark claims raise practical issues and undermine the goals of Delaware corporate law. This paper suggests that courts must be vigilant to ensure that such claims do not become vehicles for abusive litigation and violations of legislative intent.

  
  
  
• Education
  

  Teachers Unions Vs. Online Eductation

  By Katherine Mangu-Ward, Reason Foundation
  
  Reason, 07/26/2010
  

  The existing offerings of online education are making life better for hundreds of thousands of kids. But Americans are a long way from having widespread access to genuinely innovative educational practices. Only 28 states allow full-time online programs right now. A child who lives in New York doesn’t have access to any public online programs. In Virginia there are online A.P. courses, but nothing full time. In California, one has access to full-time programs but not supplemental ones, unless a district has made an independent investment in online learning. Americans can’t let state legislatures and federal grant programs pick winners. This happens when teachers unions allow only one version of online education to squeak by. But if online learning keeps growing, by 2025 education will be virtually unrecognizable, and thank goodness for that.

  
  
  
• National Security
  

  Gates’s Last Stand? Export Control Reform and its Prospects for Success

  By Neena Shenai, American Enterprise Institute
  
  National Security Outlook, 07/26/2010
  

  U.S. export control reform is a thorny political monster that periodically rears its ugly head. And it is back again. The Obama administration has proposed a comprehensive set of reforms to overhaul the U.S. export control system in an effort led by Defense Secretary Robert M. Gates. The Obama administration’s initiative has laudable goals, but how the reforms are implemented will determine whether U.S. national security is enhanced and the United States continues to be a preeminent hub of technological innovation. The Reform’s proponents must prove its national security bona fides in order to achieve political buy in from the national security community and Congress for its proposed export control reforms.

  
  
  
• Elections, Transparency, & Accountability
  

  Chinese Nongovernmental Organizations: Politics by Other Means?

  By Amy E. Gadsden, American Enterprise Institute
  
  Papers and Studies, 07/26/2010
  

  This paper explores the evolution of Chinese NGOs, their structure, and how they work. The paper analyzes how the state and the Communist Party are responding to the emergence of a “third sector” and offers examples of what some groups are doing to negotiate issues between state and society. Finally, it examines whether the emergence of Chinese NGOs, typically seen as a building block in a liberal political system, increases the likelihood that China will liberalize politically. China’s NGOs take up political issues, but they are not yet political actors.

  
  
  
• Health Care
  

  The Drawbacks of Dutch-Style Health Care Rules: Lessons for Americans

  By Ryan Lynch, Eline Altenburg-van den Broek, The Heritage Foundation
  
  Backgrounder, 07/22/2010
  

  In 2006, the Dutch government reformed its health care system based on the theory of managed competition. The most important accomplishment of the new system is that the Dutch now have near universal coverage. But, apart from universal coverage, the system does not meet many desirable expectations. There is now, in many instances, less competition and consumer choice; it could be argued that rather than creating a new system, the government is merely sharing its supply-side influence with health insurance companies. The demand side of the health expenditure equation remains virtually unchanged.

  
  
  
• Economic Growth
  

  Government Hiring Masks Real Unemployment Picture

  By South Carolina Policy Council, South Carolina Policy Council
  
  Fact Sheet, 07/22/2010
  

  South Carolina’s unemployment rate has long been among the worst in the country, hitting a high of 12.5 percent in January 2010. As of June 2010 (latest data available), the unemployment rate had fallen to 10.7 percent. During the same period, South Carolina has gone from having the 4th worst employment rate in the nation to the 7th worst. Currently, the state is one of thirteen suffering from double-digit unemployment. Worse still is that even this marginal improvement in employment is misleading. In fact, government hiring accounts for much of the new hiring, suggesting a private-sector recovery is still a long way off.

  
  
  
• Budget & Taxation
  

  Fiscal Evasion in State Budgeting

  By Eileen Norcross, Mercatus Center
  
  Working Paper, 07/22/2010
  

  Assessing budget gimmickry requires a framework to identify practices that either deliberately or inadvertently obscure the cost of policy choices to both policy makers and voters. The tactics used by states to present a balanced budget by concealing deficits prompts the need for more research into how states have traded fiscal prudence for quick fixes over a period of decades, by reliance on accounting maneuvers, fiscal illusion, and financial arbitrage.

  
  
  
• Budget & Taxation
  

  The Economic Case Against the Death Tax

  By Curtis Dubay, The Heritage Foundation
  
  Backgrounder, 07/22/2010
  

  It is long past time for Congress to repeal the death tax for good. It serves none of the original purposes Congress intended in 1916, and it presents a significant danger for family-owned businesses. Because it is a tax on capital, it is destroying some 1.5 million jobs that the economy desperately needs as it struggles to recover. An acceptable replacement exists, one that is already in place for 2010, which satisfies all stakeholders in the death tax debate—if Congress does the right thing and kills the death tax once and for all.

  
  
  
• Health Care
  

  Overspending on Multi-Source Drugs in Medicaid

  By Alex Brill, American Enterprise Institute
  
  Working Paper, 07/22/2010
  

  Brand drugs are generally significantly more expensive than therapeutically equivalent generic products. This report analyzes a large subset of 2009 Medicaid drug data from the Medicaid Drug Rebate Program and identifies multi-source drugs (i.e., products for which there are brand and generic versions) for which there are significant sales of more costly brand products. The results show that states’ Medicaid programs engage in a large amount of unnecessary and wasteful drug spending by reimbursing pharmacies for relatively costly brand products when identical generic products are available. Given rising pressures on states’ fiscal budgets, these findings, considered in conjunction with the conclusions of previous studies, indicate that continued wasteful spending in Medicaid is a problem requiring the prompt attention of policymakers.

  
  
  
• Budget & Taxation
  

  Budget Crisis Is Opportunity: Bigger Budget for FY’11 Shows Need for Policy Reform

  By Joseph Coletti, John Locke Foundation
  
  Spotlight, 07/21/2010
  

  Federal bailout money has allowed lawmakers in North Carolina to spend more than they reliably have available. Lawmakers have budgeted $1.6 billion in bailout payments, but up to $562 million of that is still pending approval from Congress. If that fails to materialize, the General Assembly has specified $519 million in transfers and cuts. Among those cuts would be $139 million from the state employee pension plan, which would mark the first time in seventy years that the state failed to meet its funding obligation for pensions.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Recycling Myths Revisited

  By Daniel K. Benjamin, PERC – The Property and Environment Research Center
  
  PERC Policy Series, 07/21/2010
  

  Recycling is a long-practiced, productive, indeed essential, element of the market system. Informed, voluntary recycling conserves resources and raises our wealth, enabling us to achieve valued ends that would otherwise be impossible. In sharp contrast, however, mandatory recycling programs, in which people are compelled to do what they will not do voluntarily, routinely make society worse off. Such programs force people to squander valuable resources in a quixotic quest to save what they would sensibly discard. On balance, mandatory recycling programs lower our wealth.

  
  
  
• Budget & Taxation
  

  Everyman’s Deficit: Spending Beyond Our Means

  By Bruce Yandle, Mercatus Center
  
  Research Papers, 07/21/2010
  

  Reining in spending and reducing regulatory burdens along with increasing GDP growth can eventually close the deficit gap. But under the best of circumstances, this will take time. The budget deficit is still a commons; it is owed by all in general, but no one in particular. If meaningful progress occurs, it will be in spite of the normal political forces that cause politicians to want to bring home the bacon while never raising our taxes. There have been times and places where human communities organized themselves to avoid fiscal crises. It needs to happen again.

  
  
  
• Family, Culture & Community
  

  Religion and Morality in the Same-Sex Marriage Debate

  By Thomas Messner, The Heritage Foundation
  
  Backgrounder, 07/21/2010
  

  Three understandings should form the basis of any discussion about the place of religion and morality in the same-sex marriage debate. First, though some people who defend marriage are personally religious or have religious motivations, support for marriage as the union of husband and wife does not require belief in the religious teachings of any particular faith. Second, many people, including some professional gay-rights activists, enthusiastically mix religion with law and politics in support of same-sex marriage. Third, the question of how marriage should be defined in law raises inescapable moral considerations that should be confronted directly.

  
  
  
• Foreign Policy/International Affairs
  

  As the U.N.’s Arms Trade Treaty Process Begins, U.N.’s “Programme of Action” on Small Arms Shows Its Dangers

  By Theodore Bromund, David Kopel, The Heritage Foundation
  
  WebMemo, 07/20/2010
  

  In 2001, the United Nations created the “Programme of Action to Prevent, Combat, and Eradicate the Illicit Trade in Small Arms and Light Weapons in All Its Aspects” (PoA). The PoA is not a treaty. Rather, it is a mechanism for encouraging voluntary cooperation. The U.S. should resist all efforts to turn the PoA into a treaty. If preparations for the 2012 meeting show that these efforts to make it into a treaty are continuing or that the PoA will persist in wasting time on broad, controversial, or unrelated items, the U.S. should withdraw from the PoA process. If it participates, it should keep the focus on using voluntary cooperation between law-abiding democracies to facilitate control of illicit arms trafficking.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Cap-and-Trade Bill Would Make Housing Less Affordable

  By Wendell Cox, Ronald Utt , The Heritage Foundation
  
  WebMemo, 07/20/2010
  

  In addition to the devastating economic effects of cap and trade, the Clean Energy Jobs and American Power Act (S. 1733)—introduced by Senators John Kerry (D–MA) and Joseph Lieberman (I–CT)—would likely lead to the same conditions that caused the housing bubble of a few years ago. Over the past decade or more numerous studies and reports have been conducted and published by a variety of independent sources on the influence of land use regulations on housing affordability. As the record reveals, communities that adopted the sort of land use regulations and restrictions implied by S. 1733 became highly unaffordable for the typical family. The ensuing housing bubble soon collapsed, and the economy swooned with it. With home prices now slowly approaching affordable levels, it would be a sad day indeed if congressional actions contributed to a reversal of this trend.

  
  
  
• Education
  

  Invisible Ink in Teacher Contracts

  By Emily Cohen, Kate Walsh, Education Next
  
  Education Next, 07/20/2010
  

  Across the country, many cash-strapped districts fretting over likely layoffs are eyeing seniority rules as they hammer out new contracts. To the surprise of some district superintendents, contract negotiations are not likely to offer much relief. In fact, when it comes to seniority rules, and many other core aspects of teachers’ employment, the contract is not the problem. State law is. In Ohio’s case, state law dictates that teachers on continuing contracts and those with greater seniority should have preference, language that is effectively emulated in 14 other states in the country. While teacher contracts may flesh out the details of school rules and rights of teachers, states are in the driver’s seat. Local control—although it is still brandished when expedient—is today more myth than reality, at least when it comes to matters involving teachers.

  
  
  
• Budget & Taxation
  

  One Sound State, Once Again

  By Geoffrey Lawrence, Nevada Policy Research Institute
  
  Analysis, 07/20/2010
  

  Nevada’s current legislative leadership—operating as the Interim Finance Committee—has already signaled its intent to ignore the state’s need for comprehensive fiscal reform and instead simply pursue a quantum increase in the state tax burden, while billing it as a comprehensive review of the state revenue structure. Like each of its predecessors over the last 20 years, however, this legislature’s tax study was structured to ignore genuine fiscal reform issues and instead merely provide cover for lawmakers out to transfer private-sector resources to the powerful, organized, tax-consuming groups that get them elected. Nevertheless, Nevada seriously needs genuine, revenue-neutral fiscal reforms, and this report seeks to fill that vacuum.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Paying For the “American Power Act”: An Economic and Distributional Analysis of the Kerry-Lieberman Cap-and-Trade Bill

  By Andrew Chamberlain, Feliz M. Ventura, Institute for Energy Research
  
  Policy Study, 07/20/2010
  

  With the passage of the Waxman-Markey bill in the U.S. House of Representatives last year, lawmakers took a historic step toward establishing a broad-based cap-and-trade system in the United States. Attention has now turned to the U.S. Senate, where Sen. John Kerry and Sen. Joe Lieberman have unveiled similar legislation known as the “American Power Act” or the “Kerry-Lieberman” cap-and-trade bill. The Kerry-Lieberman bill would establish a broad-based federal cap-and-trade system, requiring companies in electricity, natural gas, petroleum refining and other industries to hold emission “allowances” or permits for each ton of greenhouse gas emitted. This study explores the Kerry-Lieberman bill’s damaging economic effects in detail.