Monday, October 19, 2009

CBO Estimates of Climate Bill's Impact on GDP Miss Big Picture

Just read this SF Chronicle piece about the impact of the Climate and Clean Energy solutions bill on GDP.  Seems narrow to me:

The Congressional Budget Office projects that if the House-passed climate change bill were to become law, the U.S. gross domestic product would be 0.2 percent to 0.7 percent less than its potential in 2020. In 2050, the GDP could be up to 3.4 percent less than it would be without a cap-and-trade plan, the CBO said.

All of the price estimates for the climate change legislation are predicated on economic assumptions and in some cases leave out major factors, including: how pollution allowances might be distributed, and what new technologies to curb emissions and create emission-free power - even those not envisioned today - could be spurred on by new costs on carbon dioxide emissions.

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