Cap-and-trade cost is huge, but media misleads

According to an MIT study, cap and trade could cost the average household more than $3,900 per year, $3100 a year in taxes and $800 a year in other economic losses. Yet somehow the MSNBC/ThinkProgress/twisted-liberal media "Fuzzy Math" made it a 'lie' when Republicans reported this fact (HT FR). How did the Liberals pretend it wouldnt cost that much? By assuming that cap-and-trade taxation is 'free' because taxes that go to the Federal Govt get 'recycled' back to households.

In reality, cap and trade could cost the average household more than $3,900 per year.

The $800 paid annually per household is merely the "cost to the economy [that] involves all those actions people have to take to reduce their use of fossil fuels or find ways to use them without releasing [Green House Gases]," Reilly wrote. "So that might involve spending money on insulating your home, or buying a more expensive hybrid vehicle to drive, or electric utilities substituting gas (or wind, nuclear, or solar) instead of coal in power generation, or industry investing in more efficient motors or production processes, etc. with all of these things ending up reflected in the costs of good and services in the economy."

Reilly estimates that "the amount of tax collected" through companies would equal $3,128 per household--and "Those costs do get passed to consumers and income earners in one way or another"--but those costs have "nothing to do with the real cost" to the economy. Reilly assumes that the $3,128 will be "returned" to each household. Without that assumption, Reilly wrote, "the cost would then be the Republican estimate [$3,128] plus the cost I estimate [$800]."

In Reilly's view, the $3,128 taken through taxes will be "returned" to each household whether or not the government cuts a $3,128 rebate check to each household.