CBO: Kerry-Lieberman bill trims deficit by $19B over 10 years

An energy and climate bill co-sponsored by Sens. John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) would reduce the deficit by $19 billion during the next decade, the Congressional Budget Office (CBO) found Wednesday.

The American Power Act would cost taxpayers $732 billion over the next 10 years, but bring in even more revenue, the nonpartisan budget office reported.

"There is no more room for excuses — this must be our year to pass comprehensive climate and energy legislation and begin to send a price signal on carbon," Kerry and Lieberman said in a statement. "Many of our colleagues have said they flatly oppose anything that adds a penny to the deficit, so we hope they look anew at this initiative which reduces it.”

The CBO report could give the legislation a boost among deficit hawks before lawmakers return from recess next week. Democratic leaders have said they hope to proceed with some kind of energy and climate bill this summer or fall, though it's not clear what shape that legislation will take.

The score could be particularly appealing to Midwestern Democrats, who have raised fears that the bill would be too much of a tax on the economy, particularly for states relying more on fossil fuels.

The CBO also projected the Kerry-Lieberman bill wouldn't increase deficits in decades to come "because additional direct spending would be less than the additional net revenues attributable to the legislation in each of those periods."

This proposal would also go further than the Waxman-Markey, cap-and-trade climate change bill passed by the House last year, the CBO said. CBO's estimate of that bill said it would reduce deficits by $9 billion over the next decade.

Republicans, for their part, have consistently opposed all of these measures, calling them a backdoor to taxing job producers in the U.S.