| WASHINGTON, March 5
WASHINGTON, March 5 U.S. Treasury Secretary
Timothy Geithner on Thursday defended the administration's plan
to raise hundreds of billions of dollars in revenues from a
carbon emissions cap-and-trade system, saying it would help
wean America off imported oil.
Under grilling by Republican members of the U.S. House of
Representatives Budget Committee, Geithner said President
Barack Obama's plan was would necessary to change incentives
for U.S. energy use.
"It is critically important for our country that we begin
the process now of changing the incentives Americans face on
how they use energy," Geithner said. "It's important for
reducing our dependence on foreign oil, it's critical for
The plan, proposed in Obama's 2010 budget plan, anticipates
that the government would raise around $800 billion in revenues
over the decade from 2012 by selling carbon pollution permits.
These would be traded in a system that would be similar to the
European Union's four-year-old Emissions Trading Scheme.
The administration would spend the new funds on clean
energy technologies and making a new tax credit for working
Republicans criticized the plan as effectively new tax that
will raise the cost of energy for Americans who will still be
struggling with lingering effects of recession.
It "will effectively impose an additional tax burden of
more than $800 billion -- and that's a low-ball estimate -- on
everyone who uses gasoline, natural gas, home heating oil, or
electricity," said Rep. Paul Ryan of Wisconsin, the panel's
ranking Republican. "I think we can argue that covers most
Americans, not just wealthy people."
Geithner said the Obama plan is based on an approach that
has successfully reduced acid rain emissions and the system
will begin the process of shifting energy incentives towards
new, cleaner technologies.
The European cap-and-trade plan has suffered from falling
prices for emissions permits, which are required for using
traditional fossil fuels such as coal and oil. As a result,
expensive, low-carbon technologies have not been as widely
adopted as hoped, analysts said.
Geithner said Americans want the administration to shift
the country towards cleaner technology and the changing
incentives were the only way to do that. He declined to call
the plan a new tax and said the revenues generated from the
system would be pumped back to working families and put back
into the economy.
"It's good policy and its fair policy, and if you believe
in the importance of reducing our dependence on foreign oil and
reducing our dependence on carbon-intensive energy, then you
have to be prepared to change the incentives on how people use
energy," Geithner said. "You can't do it any other way.
(Reporting by David Lawder; Editing by Tom Hals)