Venable Legislative and Government Affairs partner Jim Burnley was featured in an August 2009 article in DC Velocity. In the article, Burnley spoke about the Waxman-Markey legislation and the bill's controversial centerpiece - a complex system called "cap and trade," where emission limits are set for each industry, and industries are forced to amass credits or buy allowances equal to their emissions levels.
According to Burnley, cap and trade amounts to little more than a command-and-control exercise that will wreak havoc on supply chain economics. "This is industrial policy straight out of the 1930s," he said in the interview.
Burnley and others in transportation contend that when the federal government creates a scarce new commodity - in this case, the right to emit carbon - and then mandates that businesses buy it, the costs will inevitably be passed on to users in the form of higher prices. Transportation interests worry the industry will be disproportionately affected by the cap and trade provision.
According to the article, private-sector estimates say that, over 10 years, the cap and trade measure would cost polluters in all industries between $650 billion and $1.3 trillion, and analysts say freight costs could rise anywhere from 6 to 10 percent or even higher. And in what some consider an ironic twist, carbon emissions would end up being reduced as an economic contraction leads to fewer goods being shipped and fewer conveyances needed to haul them.
"It is a horrific outcome if you are in the transportation world," Burnley says.