Sunday, July 18, 2010

EIA Analysis: American Power Act creates $2.7 Trillion Hit on US Economy

The U.S. Energy Information Administration (EIA) has just released it's analysis of the Kerry Lieberman "American Power Act" a.k.a. Cap & Tax Bill, and projects a stunning $2.7 trillion blow to the struggling US economy under the (likely) scenario of limited international implementation of similar cap & tax proposals. 

Energy Market and Economic Impacts of the American Power Act of 2010:

"The APA increases the cost of using energy, which reduces real economic output, reduces purchasing power, and lowers aggregate demand for goods and services. The result is that real GDP generally falls relative to the Reference case. [the "Reference case" is no American Power Act] In the Reference case, GDP rises 92 percent, from $14.3 trillion in 2008 to $27.4 trillion in 2035. Total present value5 GDP losses over the 2013-2035 time period are $452 billion (-0.2 percent) in the Basic case, with a range from $381 billion (-0.1 percent) to $1.1 trillion (-0.4 percent) in five of the six cases. The present value GDP losses over the same time period are larger in the Limited/No International case, reaching $2.7 trillion"

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