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Monday, June 15, 2015

Carbon Tax costs would extract greater share of income from low-income households per Congressional Budget Office Report commissioned by Rep. Henry Waxman (D-Ca.), May 2013

May 2013 Congressional Budget Office report commissioned by Rep. Henry Waxman (D-Ca.) (in office 1975-2014) finds costs of a carbon tax would not be evenly distributed, would consume a greater share of income for low-income households:

May 2013, "Effects of a Carbon Tax on the Economy and the Environment," Congressional Budget Office   

 
p. 1, Summary: Subhead: "How Would a Carbon Tax Directly Affect the Economy?"  

"Such a tax would have a negative effect on the economy. The higher prices it caused would diminish the purchasing power of people’s earnings, effectively reducing their real (inflation-adjusted) wages. Lower real wages would have the net effect of reducing the amount that people worked, thus decreasing the overall supply of labor. Investment would also decline, further reducing the economy’s total output. 
 
The costs of a carbon tax would not be evenly distributed among U.S. households. For example, the additional costs from higher prices would consume a greater share of income for low-income households than for higher-income households, because low-income households generally spend a larger percentage of their income on emission-intensive goods." (p. 2)
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This May 2013 Congressional Budget Office report was commissioned by Rep. Henry Waxman (D-Ca.): 
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p. 20: "This Congressional Budget Office (CBO) report was prepared at the request of the Ranking Member of the House Committee on Energy and Commerce [As of 2013, Henry Waxman]. In keeping with CBO’s mandate to provide objective, impartial analysis, the report makes no recommendations."



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