Jan. 23, 2009

Hinkle opposes so-called 'cap and trade' legislation
'We're losing too many jobs as it is. This isn't the time to initiate costly regulations on employers,' says Hinkle

Rep. Bill Hinkle, R-Cle Elum, has been in the Legislature for six years and served as a Kittitas County commissioner for another six years.  In all his years of public service, he says he's never been as infuriated as he was during a recent meeting with colleagues over the upcoming 'cap and trade' proposal.

"I've got to tell you, I was absolutely livid," Hinkle said.  "Our state economy is gasping for air, we're losing jobs left and right, families are struggling with the basic necessities, and yet there are some in Olympia that want to pile more costs and burdensome regulations onto businesses.  We're losing too many jobs as it is.  This isn't the time to initiate costly regulations on employers."

Hinkle said the cap and trade legislation is substantially worse than last year's "engine tax" bill, Senate Bill 6900, which would have levied a car-tab renewal tax of up to $600 for a full-size truck engine.

"My office still gets phone calls, letters and e-mails from constituents about that bill, and it's been dead for a year!" Hinkle said.  "If it gets introduced again, we'll let people know and we'll fight against it.  But the engine tax bill from last year is small potatoes compared to the consumer costs associated with the cap and trade bill."

The so-called cap and trade legislation is a proposal put forth by the Western Climate Initiative, which includes seven Western states and four Canadian Provinces.  The idea is to cap the amount of carbon that may be emitted by activities such as energy and oil production, manufacturing jobs, and, by 2015, auto emissions, in order to reach 1990 emission levels by 2020.

Businesses will have to purchase "allowances" from the government for the right to emit greenhouse gasses.  The government will limit the number of allowances available and continue to reduce that number every three years until the 1990 emission levels are reached.

If companies don't have enough allowances to cover their emissions, they will have to pay a fine up to $10,000 per day.  And, if a company doesn't use all of its emission allowances, it may sell those credits to other companies who need them.

"The extra costs to businesses that have very limited options to either pay penalties, buy credits from other entities, or reduce production altogether will have a disastrous effect on the state's economy," Hinkle said.  "Washington businesses - and consumers - will be sacrificing literally billions of dollars without any way of being able to measure the worth or productivity of the spending."

Hinkle also expressed concern for the possibility of rampant greed and corruption throughout the secondary market that will buy and sell the excess emissions credits.

"Once a free market is set up to trade allowances, the market becomes interstate commerce and will be controlled by the federal government," Hinkle said.  "When you have speculators buying and selling excess emissions credits - like we've seen with oil futures - it can create artificial highs and lows.  There's no way for Washington to control the greed and speculation that will influence this market like we saw with Enron and the sub-prime lending market."

Because Washington has some of the cleanest power and aggressive conservation policies in place, Hinkle questioned the necessity for a state-sponsored cap and trade proposal.

"Our state contributes three-tenths of one percent of the world's greenhouse gas emissions," Hinkle said.  "Why are we willing to risk our state's businesses, jobs and economy for three-tenths of one percent?

"If there is any type of cap and trade system to be put in place, it needs to come from the federal level," Hinkle continued.  "There needs to be further protections for our state than what we're seeing in the current proposal.

"Some will try to argue that Washington will be a leader in reducing greenhouse gasses.  I say Washington is already a leader.  We have clean, abundant hydropower and some of the best conservation policies in the nation," Hinkle said.  "There's no need to risk our economy by embracing this proposal."

The governor is expected to propose her cap and trade legislation, dubbed the Climate Action Plan, soon.

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