• Matthew Yglesias cites a new CBO study (with a great chart) showing the relative effects of carbon credit auctions versus carbon credit giveaways on household income. Simply, auctioning carbon credits to industry and using that money to issue rebates to energy users results in gains for the lowest quintiles and modest losses for the higher ones, and giving away credits to industry results in large losses for everyone but the very highest quintile, who see a large gain.

Naturally “moderate” Democrats such as Jeff Bingaman prefer the cap-and-giveaway out of what they deem pragmatism, but what looks a lot like fanatical devotion to the interests of the well-off to the exclusion of other concerns. […] So if a cap-and-trade bill does pass, I assume it’ll take a cap-and-giveaway form, and you can bet that opponents of auctions will specifically cite the interests of the economically struggling as their main motive for screwing the economically struggling over.

• Both Ben Nelson and Mike Johanns are on the list of the 28 senators who oppose using the budget process to implement cap-and-trade. Nelson previously stated he questioned “…counting revenue for cap and trade policies that haven’t been implemented and could have a negative impact on our economy.” The CBO study estimated both cap-and-auction and cap-and-giveaway would have an almost identical -0.5 percent effect on GDP.

While some loony Republicans attempt to convince high-earners to “Go Galt” by refusing to offer their contributions to society until the lower classes learn to accept their inferiority, you see others going the opposite route. It really is nice to see people looking out for each other and acknowledging that being a low-wage worker doesn’t mean you’re a useless leech.

from Politico:

“I have major concerns about trying to raise taxes in the midst of a downturn of the economy,” said Nelson, the conservative Nebraska Democrat. “On the one hand, you’re trying to stimulate the economy. On the other hand, you’re trying to keep money from going into taxpayers’ pockets. It’s very difficult to make that logic work.”

What we’re seeing here is the same thing we saw during the stimulus debate. Rather than basing his opposition on reality, Ben Nelson is basing his opposition on Republican talking points. Or as Matthew Yglesias said, “It’s particularly depressing here that Nelson seems to have gotten 100 percent of his information about Obama’s tax plans from Fox News and zero percent from participating in the extensive on- and off-the-record briefings for members of congress, congressional staff, and media that the administration has organized.”

For a little context on the top tax rates, check out the graph at Balloon Juice. As John Cole said, “The 2010 proposed rate of 39.60% = socialism. The 2002-2008 rates of 35.00% = capitalist nirvana. The 39.6% rate of the 1990’s = socialism. Everything else = down the memory hole.” It’s a durn shame we never had any economic growth before 1988. Oh, and if you’re really adventurous, check out the last time the top tax rates were in this neighborhood.