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Claims of Udall carbon tax have no substance

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Tuesday, July 29, 2014 5:39 PM

Crossroads GPS claims that Colorado Sen. Mark Udall "voted to enact a carbon tax." Udall did no such thing.

Crossroads points to Udall's march, 22, 2013, vote for a budget resolution amendment to require any possible future carbon tax to be revenue neutral, with the money the government would receive from the tax being returned to the American people. In other words, Udall voted to support making a hypothetical tax revenue neutral.

The amendment was incapable of enacting anything. It didn't call for the enactment of a carbon tax plan, which would be a direct tax on the carbon content of fossil-fuel energy, such as coal, oil and gas.

The goal of such a tax - like other pollution-reduction strategies - would be to lower the amount of carbon dioxide released into the environment. A fee on carbon is designed to raise the price of fossil fuels, prompting consumers to switch to renewable energy options and consume less energy, and leading businesses to develop new energy-reducing products and technology.

Whether that would lead to "squeezing middle-class budgets" or businesses and by how much depends on many details that would have to be addressed in carbon tax legislation. Charles Komanoff, director of the Carbon Tax Center, said "To my knowledge, there has never even been a hearing, even just an informational hearing on anything that is or resembles a carbon tax bill."

Obama's claims of recovery

President Barack Obama said, "We've recovered faster and come farther than almost any other advanced country on Earth." According to the administrations annual economic report, the U.S. is "one of only two of the 12 countries that experienced systemic financial crises in 2007 and 2008 but have seen real (gross domestic product) per working-age person return to pre-crisis levels."

The 12 countries are France, Germany, Greece, Iceland, Ireland, Italy, Netherlands, Portugal, Spain, Ukraine, United Kingdom and the U.S.

"The general sentiment is quite right," said Jeffrey Frankel, an economist at Harvard University. "But to evaluate the statement in its sweeping form, one would have to look at more countries, and one should look at other possible measures of economic performance."

Among the countries beyond the U.S. that are doing well are Canada, Germany and Switzerland. Israel and some Asian countries, such as Korea and Singapore, have seen improvements as good or better than the U.S. in recent years, but they were not as dramatically affected by the recession as North America and Europe.

Laurence Ball, an economist at Johns Hopkins University, said another factor to consider is the long-term damage caused by the recession. Ball looked at 23 countries that belong to the Organization for Economic Cooperation and Development and compared how much they thought they could grow in 2007 to how much they think they can grow now, based on OECD estimates. Ball found that, on average, these countries sustained an 8.3 percent blow to their potential output for growth.

While some countries, Australia and Switzerland, took a very small hit to their potential output. For the U.S., the figure is 5.3 percent - lower than the rate for most advanced countries, but higher than Australia, Switzerland and Germany. This shows that even though the U.S. has recovered well compared with other countries, it has still lost potential output as a result of the recession, Ball said. The White House's supporting data is pretty narrow, but other measurements show that the U.S. s has generally fared better since the recession than many - though not all - of its peers among the world's advanced economies.

Chip Tuthill is a Mancos resident. Sources used for this column: www.factcheck.org www.politifact.com

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