A Carbon Tax Would Destroy America

Alan Caruba | May 24, 2013

If you want to know what a carbon tax on emissions of carbon dioxide (CO2) would do to America you need only look at the destruction of industry and business in Australia, along with the soaring costs for energy use it imposes on anyone there.

"The carbon tax is contributing to a record number of firms going to the wall with thousands of employees being laid off and companies forced to close factories that have stood for generations", Steve Lewis and Phil Jacob reported in a March 18 issue of The Daily Telegraph, a leading Australian newspaper.

"Soaring energy bills caused by the government’s climate change scheme have been called ‘the straw that broke the camel’s back’ by company executives and corporate rescue doctors who are trying to save ailing firms."

The passage of a carbon tax in America would have the exact same results and it remains a top priority for the White House and Democrats in Congress who see it as a bonanza in new funding for the government.

As Paul Driessen says in a Townhall.com commentary, "More rational analysis reveals that dreams of growth are nothing more than dangerous tax revenue hallucinations. They would bring intense pain for no climate or economic gain."

Too many Americans still believe that CO2 is causing global warming, but CO2 plays no role in climate change and is barely 0.038 percent of the Earth’s atmosphere. More to the point, there is no warming and hasn’t been for the last seventeen years as the Earth is in a natural cooling cycle that has prolonged the advent of spring with severe snow storms throughout the nation.

There is no scientific justification for such a tax, but those advocating it don’t care about the science. They care about raising revenue for an ever-growing government to spend and waste.

Driessen points out that "Hydrocarbons (coal, oil, and natural gas) provide over 83% of all the energy that powers America. A carbon tax would put a hefty surcharge on everything we make, grow, ship, eat, and do. It would put the federal government in control of, not just one-sixth of the economy, as under Obamacare, but 100% of our economy and lives. It would make the United States increasingly less productive, less competitive globally, less able to provide opportunities for our children."

The case for a carbon tax simply doesn’t exist, but there are powerful forces in Congress and the support of the White House to impose such a tax. The power of the environmental movement and its long history of lies about the climate, primarily the global warming hoax, cannot be dismissed or ignored.

In Australia, "The Australian Securities & Investments Commission reports there were 10,632 company collapses for the 12 months to March 1 - averaging 886 a month - with the number of firms being placed in administration more than 12 percent higher than during the global financial crisis." It represents "a record high...led by widespread failures in manufacturing and construction, which accounted for almost one-fifth of collapses."

Greg Evans, the chief economic economist for the Australian Chamber of Commerce and Industry, said that "It defies logic to adopt a policy which even the Treasury acknowledges will lower our standards of living and be harmful to national productivity." Adding to Australia’s struggling companies, the carbon tax and one on mining were showing up as "sovereign issues" in discussions with foreign investors." Who would want to invest in Australia if these two taxes were destroying the economic strength of the nation?

Politics in Australia is no less a battleground than here in America. Australia’s Prime Minister, Julia Gillard, who introduced the carbon tax, just beat back a bid by her Labor Party’s dissidents to reinstall former leader Kevin Rudd who lost to her in 2010 and 2012. Much of the opposition to her comes from the harm being inflicted by the carbon and mining taxes.

Marlo Lewis is a senior fellow in energy and environmental policy at the Competitive Enterprise Institute
. During the 2012 campaign, he described a carbon tax as "political poison for the Republican Party." Mitt Romney opposed it, but
‘the big attraction of carbon taxes these days is not as a global warming policy but as a revenue enhancer. In both parties, deficit hawks and big spenders (often the same individuals) are flailing for ways to boost federal revenue."

That is precisely the problem afflicting a nation whose Congress and President could not find a reason to cut anything from the federal budget. The result was the "sequestration" that imposed cuts neither party could agree upon.

In a Fox News article, "Here comes Team Obama’s carbon tax". Phil Kerpen, president of American Commitment and author of "Democracy Denied" reported that "The Treasury Department’s Office of Environment and Energy has finally begun to turn over documents about its preparations for a carbon tax in response to transparency warrior Chris Horner’s Freedom of Information Act request. The documents provide solid evidence that the Obama administration and its allies in Congress have every intention of implementing a carbon tax if we fail to stop them."

President Obama’s nominee to be the next Secretary of Energy, Ernest Moniz, is on record wanting to double or triple the cost of energy, much as his predecessor wanted.

A carbon tax, if enacted, would totally undermine a nation that has a debt climbing toward $17 trillion and millions unemployed in an economy that is struggling to inch its way out of the depths of the financial crisis.

If you wanted to destroy America, you could do it with a carbon tax. Australia is reeling from the cost to its economy and the higher energy costs its people are paying. We don’t want that here.
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Alan, I Think that you should write to somebody important and tell them that the leading academic energy economist, Ferdinand E. Banks (Fred), is a little short of cash these days, and would like to help him find a good energy secretary. I dont see how they could get any worse than Chu, but I remember discussing nuclear energy with some ignoramus, and when he cited Montz as a possible candidate, I had a sinking feeling way down in my stomach.

At the same time however, I dislike your dislike of our president. He is doing his best, although his best aint worth a damn, even if it makes fifty times as much sense as the best of George W. Bush.

Another point of interest. I have taught or done a song and dance at 6 universities in Australia, and I can't imagine that country "reeling" from some tax, regardless of how silly it might be. What I can imagine is that sooner or later the voters will listen to people in that country who want nuclear, and if they do what Professor Banks thinks that they should do, that is the end of Australia's energy worries during this Century.

I expect that "carbon tax ruins Australian economy" is simply another of those unsubstantiated claims made by Mr. Caruba and his co-fools who believe anything said on Fox "News".

I thought journalists were supposed to report the facts, not make up their own...

One company closing a soda ash mine and laying off 70 employees because they can't afford to pay $1 million/year in taxes(reduced from $8 million) due to cheap foreign competition will hardly paralyze the Australian economy.

$7,000,000 / 70 jobs = $100, 000 per job government subsidy.

-------" The price of photovoltaics has been decreasing, and in January 2013, was less than half the cost of using grid electricity in Australia.[5]"---------


I'd say that a plant closure due to energy costs in spite of a $100,000 per job government subsidy and government incentives that allow the installation of solar power (that is abundant and the fuel is free once installed) and costs about 1/2 currently available grid power------probably represents far more political and propaganda posturing and extremely poor management than it does energy costs or foreign competition.

Then trying to draw generalizations and conclusions on the US economy from this situation is just plain clumsy and stupid.

Follow the money. And be very careful about placing bets with a man shuffling around a pea under walnut shells and talking very fast.

“At the same time however, I dislike your dislike of our president. He is doing his best, although his best aint worth a damn, even if it makes fifty times as much sense as the best of George W. Bush.” Professor Banks

“I expect that "carbon tax ruins Australian economy" is simply another of those unsubstantiated claims made by Mr. Caruba and his co-fools who believe anything said on Fox "News". Len Gould

The article is about carbon tax. I don't know enough about the subject to comment. The two quotations above don't really deal with the topic although the authors would have us believe they do.

Professor Banks has on many, many occasions expressed his contempt for George W Bush whether it had any relevance or not to the issue. He has never actually says what he finds wrong with him.

Len has taken me to task and discounted my comments on a number of occasions for not citing peer reviewed citations. Yet he fails to cite even one instance of Fox News being in error. He snidely presumes that everyone agrees with his particular brand of liberalism.

George W. Bush started a war on the basis of a lie, Don - a war about oil which caused the loss of thousands of innocent lives.. On one level or another President Obama joined in a war about oil, in Libya, although the lie at that time was 'protecting civilians'.

I'm surprised that you feel a need to ask for an explanation from my good self. Of course, I am willing to listen to an argument that Obama is worse than Bush, because he is an intelligent man, while Bush is completely and totally ignorant. I'm even more surprised that a man like you, who has seen what the US is capable of if they have the right kind of leaders (like FDR and President Truman) can accept the foolishness that Bush and Obama stand for, and what that foolishness will eventually cost our country.

One doesn't need to know much about the details of a carbon tax system to appreciate the obvious: a huge proportion of our industries and economy depends on energy derived from carbon based fuel, whether it be coal, NG, or oil, and so does manufactured goods that rely on the massive petrochemical industry too.

A widespread imposition of a carbon tax would be a major change to the economy as a whole. Depending on the rates of taxation, the costs for large established commercial sectors of our economy, and for consumers, would be radically modified, promoting of course incentives to shift consumption and the production of products, including energy, away from carbon sources. In theory this is exactly what governments who are considering this want. The only question is can the economy's industries and consumers do it without a lot of pain, since it surely won't be that easy to shift, and it cannot happen overnight either, it will take decades without massive pain.

I myself am not too worried about a carbon tax system destroying our economy with lots of pain. You see our governments are not that stupid. They will surely adjust the taxation rates either up or down to levels that don't destroy the economy so fast. It they didn't, and large industries suffered too much, they would be cutting their own throats from the loss of business tax revenues and consumption sales taxes from a ravaged economy.

So I won't lose any sleep over it.
Bob Amorosi

“George W. Bush started a war on the basis of a lie, ...”

No. He started a war on the basis of Faulty information. Faulty US intelligence, faulty intelligence from our allies. I think it was the worst intelligence failure in history. We, and others, had literally thousands of people ;trying to learn the facts and we got it wrong. It was a failure, not a lie.

Today we hear from many quarters, not just Bush haters,“Iran must not be allowed to have a WMD.” Giant bombs have bee designed (already built?) to deal with Iran's WMD program.

Don. No matter what "known knowns" and "unknown unknowns" Rumsfeld etc. have tried to put up as excuses for the Iraq invasion, it is clear simply by reviewing Colin Powell's testimony at the UN, which presented all the actual facts they had available, that they had insufficient PROOF of any threat to the US from Iraq to justify the invasion. They had a lot of fears and speculations, largely based on expat Iraqis who it turned out were flat lying about the existence of such weapons, and the likely reaction of the populace, to further their own interests. None of that was considered reliable enough to present to the UN for inspection, leaving Powell only with a few photos of "possible mobile weapons factories" and very little else lol. Even Canada's foreign intelligence information services had enough solid data to allow our government to refuse to participate. But of course, Canada's oil companies had very little hope of gaining any footing in Iraq's oil fields, so there was no incentive.

The Bush administration, starting from a predetermined position (we will invade Iraq, go find us an excuse), simply steamrolled their own intelligence services and bullied them into not publicly opposing the invasion.

You may argue that the invasion did a good thing simply by changing the Iraqi government, but I think you might find that the tens if not hundreds of thousands of civilian casualties might disagree, especially considering the way civilian security systems were destroyed and never properly replaced during the event.

This commentary has lowered the bar of intelligent conversation concerning energy policy.

I remember seeing a news reel of Neville Chamberlain returning from Munich. It was 1938 and he had agreed with the Nazis never again to have war. He had secured “peace in our time.”

In 1938 the French Army might have been better than the Ger,am Army in maybe every respect. The British Navy far superior to the German fleet. And we already knew something of the the egregious character of the Nazis. This was the time as it turned out to have prevented WWII by confronting Hitler, not by having a love fest and a slogan. Peace in our time.

In 1939 I saw a German Army film of the invasion of Poland. (At a movie theater in an ethnic German neighborhood of Chicago. It must have had sub-titles.) What I remember most clearly was the large number of horses. A dramatic fording of a stream with four(?) horses struggling up a bank pulling a small howitzer. I saw Stukas, in action - later to become flying coffins.

The Germans would never have successfully taken Briton. Even with years to prepare we could not have retaken Europe except that the Russians had already shredded the German Army by D-Day and the Luftwaffe had been destroyed.

Those who opposed the entry of the US in WWII realized Germany was no military threat to the USA. However an Iraq with WMD did present a realistic threat to the USA even if Iraq would ultimately lose. In the area of moral turpitude who would you pick: Hitler or Saddam Hussein? (If rated on the number of people murdered the prize would go to Stalin, our ally.)

George W and his advisers knew all this.

Don, for once I agree with you that any weapon that Iran can produce is little more than a cap gun compared to the weapons available to the USA. Should Iran be stupid enough to use such a weapon against anyone it will mean the end of Iran - which I don't think those in power in that Nation really want.
But back to the issue at hand which is the USA embracing carbon tax. Well not in a million years will that happen. First you have to subscribe to the idea that Carbon Dioxide in the atmosphere is a bad thing (it isn't) and second you have to subscribe to the idea that you can get re-elected (your party that is - not Obama whose days - thankfully - are numbered) by taxing the crap out of a nation still teetering on the edge of recession.
The great liberal experiment that is California is collapsing under the weight of assinine laws along the same lines and - despite the wonderful climate there - is losing people in droves to Texas who take a somewhat more business like approach. California is to all intents and purposes bankrupt and you have to look no further than its tax system to see why.
Do the same to the entire US and the economy will be in shreds along with the rest of the world. China on the other hand will prevail because it is not dumb enough to do such a thing.

Mr S.D., if you want to discuss energy policy, you are quite welcome to join us. I am sure that you will find people on this site who know more than you know or are capable of knowing. But there are things more important than what you call "energy policy". Those things are lies and misunderstandings, such as the lie about intelligence failure, and Mr Obama's constant claiming that there is 100 years of natural gas in the US. There might be a thousand, but on the basis of existing evidence, there is a maximum of 50 Before natural gas peaks.

And it was a lie, Don. People who were in those White House briefings have made that clear to the TV audience, and for all his shortcomings, Dick Chaney was too intelligent to buy the ignorance and stupidity of his boss.

And Don, it is really sad that a man as intelligent as you doesn't get the message. The first atom bomb was meant for Berlin. No matter what happened before that, that would have been the end of the war in Europe, and listen - listen very carefully now - had the ground war in Europé gone badly, Roosevelt or Truman would have told Oppenheim and Groves to stop playing grab ass and produce that bomb.

By the way, Len, a former captain in the US Marine Corps was at one Point in charge of looking for WMD in Iraq, and he made it clear to everyone who could understand English that no such weapons existed. Of course Saddam had some poison gas that could have been dangeous for his countrymen, but nothing that dumb Condoleeza Rice and ignorant George Bush had to worry about during their strenuous efforts to improve the lives of upper-income Americans by convincing lower-income Americans that fighting a war on the basis of a lie was beneficial to their security..

Back to the CO2 tax.

Would it make any real difference on CO2 emissions? Are CO2 emissions particularly relevant to the global climate? No on both counts, IMO, although I suppose if you completely tank the economy, then CO2 emissions would be lower. However, the actual impact of CO2 is overwhelmed by not fully understood natural processes, as the major disconnect between climate models and realty clearly demonstrate.

The actual basis of the CO2 tax is to raise money for grossly bloated governments. Period, end of story. Alan has it exactly right.

PS As for Iran, true enough that their nuke is relatively inconsequential for the US. However, Israel would simply cease to exist if the used it and Iranians have said they intend to wipe the Israel off the face of the planet. Considering the evil nature of the Iranian regime, I believe they will attempt to destroy Israeli. No doubt, Obama will say if they do, then Iran will have crossed a "red-line".

As I understand the situation, there are some changes being made in this site, and since I am unwilling to submit articles by e-mail, I will soon lose access. Frankly I dont care. In my articles and lectures I have noted that participating in the discussions on EnergyPulse has been marvelous, but I experience no difficulty in recognizing that many good things cannot last forever. Besides, I Think that I have a replacement. Mr S.D., who wants to raise the bar of intelligent conversation so that George W. can understand it..

There are some changes in the wind and I did get an e-mail about it from the editors. Appears I will have an article (which I submitted by e-mail, just like I always have) to be issued around the 25th of June. You will find the article very interesting - suggest you stick around.

.”..insufficient PROOF of any threat to the US...”Len Gould

“... - listen very carefully now - had the ground war in Europe gone badly, Roosevelt or Truman would have told Oppenheim (sic) and Groves to stop playing grab ass and produce that bomb.” Professor Banks.

Len the only time I can remember dealing with metaphysical certainty PROOF was as a HS freshman or sophomore in Euclidean geometry. Proofs were the course. Quite satisfying during the bad times of WWII.

I don't know of any time large decisions were made on the basis of perfect knowledge. They are made on the best available information on that day. (My divergence to WWII above comments was to illustrate that had Neville Chamber land held Hitlers feet to the fire rather than being agreeable perhaps, just perhaps, our history would be better. To have PROOF might have meant waiting till Dunkirk. Proof is always too late, Ex post facto.

Whether it was Germany's '30's conduct or the absolute unspeakable conduct of the Japanese we did not need the kind of PROOF you blithely throw around to have assessed their character and ambitions. The PROOF was in the Blitzkrieg and Pearl Harbor.

As to the A-bombs.

In his usual conniving fashion FDR did not tell his serial hand-picked vice president Harry Truman about the Manhattan Project. (FDR would have had to order them not to tell Truman.) Yet thousands had to know. But Truman learned about it when he was already president. HST authorized Big Boy and Little Boy to be dropped on Hiroshima and Nagasaki and they were in early August. FDR died in April 12,1945.

Killing innocents. What's all this moaning and groaning and gnashing of teeth about innocents being killed in war? Haven't you heard, “War is hell.” The Allies and Germany killed innocents every goddam day. What were those bombers dong over London, Berlin and Tokyo? The Germans in one day wiped out Coventry England. We leveled Dresden. Killing a Nazi would have been strictly by chance. Now we try not to kill innocents. We sent thousands of bombers, imagine a thousand plane raids over a city. When a bomber didn't come back neither did ten good men.

Ok Don, make that "insufficient evidence". Nothing else changes, and you know it (at least now) as well as we do. When I first knew with certainty that Bushco was going to invade Iraq, I would say to friends "That's fine. The US gave them the weapons, let the US go in and take them back then". However, when after a year of searching every creek and ditch in Iraq turned up no weapons, I finally realized the US was being run by a mix of morons and cynical opportunists which deserved to be executed for their crimes.

And for the NSA, let me add the executions should happen after proper investigations, public trials before US juries randomly selected, and all just due processes.

And btw, I have always from the beginning strongly supported the operations in Afganistan, which started significantly prior to the Iraq fiasco, and where per capita Canada's military has taken higher casualties than the US last time I checked.

That is Canadian casualties per capita Canadian population count compared to US casualties per capita US population count, in case of any confusion.

Well Don, I think that you should stay away from the subject of A-bombs, because you might show up in front of a seminar or Conference in Stockholm someday, and that is your topic, I'll just have to be in the front row And incidentally dont visit the Technological University in Stockholm, because the energy economics people are PARASITES AND CHARLATANS, MULTIPLIED BY TEN.

On your last posting Don I have to agree with you that it really matters nothing how people are killed - whether in one great big bang or a million smaller ones. There have been millions more people killed on the roads of North America since Hiroshima that were killed at Hiroshima. No body stops driving their cars though.

The reason and the only reason why the public is terrified of nuclear weapons is that war suddenly is in your very own back yard. Apparently it is fine to send young men and women in uniform to their almost guaranteed deaths but when it comes to experiencing the same fate oneself - oh well THAT is a whole different story isn't it. Fortunately these weapons are so fearsome (they have come a long long way since the little pea shooter called Big Boy) that no-one will risk their own destruction. It is called mutually assured destruction only a mad man would engage in it.

It is a very sad commentary on our human race that we are singularly unable to solve the worlds food water and energy problems but when it comes to building devices to destroy ourselves - well we are just masters at it.


Moderate CO2 taxes will not destroy anything, and can help a lot to improve efficiency, IF the revenues are directed right back at encouraging CO2
reduction programs and technologies.

Mr. Caruba, a well know shill for the mine it or drill it and burn it industry,
grossly exaggerates the potential effects.

I will admit to some of the problems seen in Australia being disruptive to
their coal-fired industries, but this is because their $23 per ton tax was
not implemented gradually, starting at much lower levels.

But just so you get a true feel for the numbers, here's what a $10 per ton
tax would do in America today. (This is the base amount in California's
now in place CO2 cap and trade program)

Gasoline would cost 10 cents more per gallon, which is down in the noise
of weekly gasoline price fluctuations.

Your residential electric power bill would rise less than 1 cent per kwh, or
typically cost you between $3 and $12 more per month, based on 300-1200kwh
consumption per month.

Your natural gas bill would rise by about 55 cents per mcf.

A 1000 mile commercial jet plane ride would cost you less than $3 for the CO2 tax(your seat space creates less than 1/2 lb CO2 per mile)

The cost of energy in most products that you use is usually a miniscule portion of the cost of the product, and you are looking at adding 5-10% of only that miniscule portion, so there is no ACTUAL consequence, but it may be what som companies will use as a bogus excuse to raise prices. Competition may minimize this effect.

Use the numbers above to calculate your own CO2 tax estimate.

And don't believe the scare tactics and rhetoric that Mr Caruba is so fond
of spraying about...it's really a lot of "waste product".


Oh, and Caruba's climate change knowledge is not a simple nil, it is actually negative, his statements being CONTRARY to demonstrable fact.

CO2 daily averages are now tipping past 400 ppm at the official measurment site
in Hawaii, where they have been measured since the late 1950's. The 0.038%
he uses is data from over a decade ago. 2002 = 385ppm

Liars use numbers to lie, but the real numbers themselves do not...

The objective of CO2 taxes is to raise money for bloated governments, with reducing CO2 irrelevant. Your own simplistic economic analysis demonstrates why: if the "cost" of CO2 taxes is so low, then so will be the reduction in CO2.

Kindly stop using personal attacks and use logic and reason to make your case.

Well folks, we have another demonstration here of the rotten teaching of energy economics in the US, and for that matter the rest of the World.

It's amazing isn't it that the United States Department of Energy cannot give us the final word/analysis on carbon taxes. Isn't there somebody in that big building in Washington DC who can do the algebra necessary to provide a sensible presentation of the carbon tax puzzle.

Seems to me it is completely irrelevant for the DOE to perform such an analysis for a whole host of reasons, including: (1) the dire effects of CO2 and global warming are simply unproved speculation, with the existing models unable to deal with reality; (2) CO2 taxes are clearly nothing more than a scam to increase government revenues; (3) you simply cannot believe anything the government says.

Micheal, if your point (3) is actually true now about a Democratic admin. as it was proven true of the recent Republican, eg. WMD in Iraq, then you may as well simply give up of the country and move somewhere safe.

The Republicans were voted out of office in the hopes the Democrats would do a better job. Unfortunately, things got worse. Need to vote the current crew out and replace them. The 2012 mid-term elections demonstrated what happens when folks get fed-up.

You mean things got worse for ultra-rightists,eh? :)

I'm sorry Michael, but better the USDOE than some millionaire who wants to be a billionaire.

I flatly disagree. The DOE is not qualified to assess the economic impact of CO2 taxes, although they and any competent energy professional could calculate the cost impact on power prices caused by CO2 taxes. The trick is assessing how the additional tax impacts the various sectors of the economy and the economy as a whole. As the government has a vested interested in advocating the tax, they simply cannot be trusted to perform an even handed assessment.

Again, the tax is not going to curb CO2 emissions to any meaningful extent unless the tax is draconian and such a tax would also have a draconian impact on the economy. If the objective is actually to reduce CO2 emissions, than better efficiency in power generation and electricity use is a vastly superior solution, with the added benefit of reduced energy costs and that helps the economy because folks have more money in their pocket.

There simply is no question that the objective of a CO2 tax is to increase revenues for bloated governments.

Record numbers of Americans are on food stamps, black unemployment (particularly youth) is at stunning levels, vast numbers of Americans have dropped out of the work force and we have mind-numbing deficits. Quite predictable when the government attempts to seize control of the economy. Things are worse and our children's futures are not looking so good if we stay on this track. The bums will get voted out of office, sooner or later.

Michael, I am NOT going to disagree when you say that the government cannot be counted on to give an even-handed assessment of the carbon tax 'thing'. That's the way that some governments often work these days, and I can't stand Obama because I thought that his government would be different, and he would do what he could to give us the America we want and deserve. I can mention though that deficits didn't come into the Picture with me, because I remember writing once that the government of Ronald Reagan borrowed more Money than had been borrowed since the Revolutionary War, taking into consideration the two World Wars.

But I can tell you now that had I been the boss of the DOE you would know the truth about carbon taxes. You would know the truth because if I could not have made that calculation, I would have easily found someone who could, and there are plenty of young - and maybe old - Americans who are qualified to do that work,

And there we have the problem. I remember how - I Think it was at Fort Belvoir - some outfit had the motto THE DIFFICULT WE CAN DO - THE IMPOSSIBLE TAKES A LITTLE LONGER. Well, behind the slogans and propaganda and lies and misunderstandings, what we see is that we not only cant do the impossible, but we cant do the eminently possible. Thanks for nothing Mr President..

GOP Plan To Sabotage The Stimulus Package :<] Out of date but still expresses what I think is happening.

Actually, I believe that was the motto of the US Navy SEABEES during WWII: "The difficult we do immediately, the impossible takes a little longer". Would not be surprised, however, if the Army engineers borrowed the motto.