04.03.2013 0

IMF calls on U.S. to institute $500 billion carbon tax

By Robert Romano

The International Monetary Fund (IMF) has called upon the U.S., its largest contributor, to levy a $500 billion a year carbon tax on consumers to offset what it calls “underpriced” oil, coal, and other energy products.

This “mispricing” is supposedly leading to “excessive energy consumption,” which is “accelerating the depletion of natural resources” and contributing to climate change.

“The IMF is lobbying on behalf of environmentalist radicals, arguing that not implementing a half-trillion dollar a year carbon tax is a de facto energy subsidy,” Americans for Limited Government President Bill Wilson wrote in a letter to members of the House Financial Services Subcommittee on Monetary Policy and Trade.

The IMF study, published on Jan. 28, states, “Consumer subsidies include two components: a pre-tax subsidy (if the price paid by firms and households is below supply and distribution costs) and a tax subsidy (if taxes are below their efficient level).”

In a statement, Wilson called the IMF’s view “warped.” He added, “not taxing being construed as a subsidy that economically crowds out anything is as Orwellian as it gets. There is no level of deception these people will not stoop to in order to hide their true ends.”

The study justifies these taxes as preventing climate change: “The efficient taxation of energy further requires corrective taxes to capture negative environmental and other externalities due to energy use (such as global warming and local pollution).”

In a March 27 interview, the IMF’s head of fiscal affairs, Carlo Cottarelli said, “Even where countries impose taxes on energy, they’re rarely high enough to account for all of the adverse effects of excessive energy consumption, including on the environment.”

Cottarelli claimed that not taxing carbon emissions in the U.S. by $500 billion a year “crowd[s] out public spending that can boost growth, including on infrastructure, education, and health care. Cheap energy can also lead to overconsumption of energy, which aggravates environmental problems, such as pollution and climate change.”

“Just think about what Cottarelli said. It’s a completely distorted view of reality. It is higher energy costs and increased taxes are what would actually dampen consumer spending in other areas,” Wilson explained.

Therefore, Wilson said, the IMF-proposed carbon tax is “just a means to an end by increasing governmental power over other these other areas of the economy, like health care and education, for one by raising $500 billion a year in additional revenue.”

“By strangling the economy for money and restricting energy consumption, people will naturally turn to governments for sustenance since producing value in the private sector will come at a much higher premium. What good is a job in the U.S. economy if a person cannot afford to drive there?” Wilson asked.

He also criticized the IMF for bailing out Greece, Portugal, and Ireland with $86.6 billion of bailouts, which the U.S. has contributed about $17 billion to, and the IMF’s role in levying a €5.8 billion savings deposit tax in Cyprus.

Wilson said the U.S. “should have nothing more to do with this radical outfit,” and called on Congress to reject the Obama Administration’s budget request to double the nation’s quota subscription in the International Monetary Fund (IMF) to $130 billion from its current $65 billion level, converting part of the nation’s current $100 billion line of credit to the IMF.

If the Obama request was fulfilled, it would keep the nation’s total stake in the IMF at $165 billion.

“Not only should that request be rejected, but Congress ought to withdraw our quota subscription altogether, along with the $100 billion line of credit,” Wilson added in his letter to the House subcommittee, concluding, “Taxpayers should not be propping up bankrupt socialist states and the banks that fund them, let alone financing the lobbying efforts of radical environmentalists.”

Robert Romano is the Senior Editor of Americans for Limited Government.

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