June 12, 2007

Mr. James W. Owens Chief Executive Officer Caterpillar, Inc. 100 North East Adams Street Peoria, IL 61629

Dear Mr. Owens,

You recently acknowledged that excessive regulations harm Caterpillar’s bottom line, noting in your 2006 Annual Report to Stakeholders that Caterpillar’s on-highway truck engine business would drop significantly in 2007 due to new emissions regulations.

That’s why we were astonished to see that Caterpillar had joined the United States Climate Action Partnership (USCAP), which seeks to establish a cap-and-trade system for carbon emissions. If such a system is established, many of the industries upon which Caterpillar depends would be harmed.

As you may know, the Congressional Budget Office reported in April that the oil, gas and coal industries upon which Caterpillar depends for sales – would be particularly hard hit by the establishment of a cap-and-trade system.

For example, a cap designed to reduce emissions by 23% would result in a 54% devaluation of coal stock value and a 40% decline in coal production. Do you think a 40% reduction in coal production is likely to boost or reduce your sales to this industry?

Other Caterpillar customers will be affected, too. How many sales will you be making to farmers if they can make more money from sequestration than from harvesting crops?

Let’s be clear about the objectives of some of your coalition partners.

The Natural Resources Defense Council, National Wildlife Federation, and Environmental Defense have a long history of opposing the very industries that are Caterpillar’s best customers, often through expensive litigation.

Rather than help deliver your loyal customers to the legal sharks of the environmental movement, Caterpillar should help its customers fight the onslaught of unnecessary emissions caps and regulations that would harm them.

We ask that you immediately withdraw from the United States Climate Action Partnership.

The undersigned represent a diverse group grassroots property rights organizations, think tanks, page 2 seniors advocates, taxpayer action groups, construction firms, farmers, ranchers and miners – a number of which are current Caterpillar customers.

If Caterpillar can’t be loyal to its customers and consumers, perhaps there’s no reason to be loyal to Caterpillar.

Sincerely,

David Ridenour Robert E. Murray Hon. Edwin Meese, III Vice President Chairman, President & CEO Former U.S. Attorney General National Center for Public Policy Research Murray Energy Corporation Reagan Administration

Roger C. Herrera Matt Kibbe J. William Lauderback President President Executive Vice President Northern Knowledge FreedomWorks American Conservative Union

Bruce A. Griffith Myron Ebell Hon. Malcolm Wallop President Director, Energy & Global Warming Policy Chairman Griffith Lumber Co., Inc. Competitive Enterprise Institute Frontiers of Freedom

Robert A. Drummond Drew Johnson Roger Jones Southern Regional Director President Engineer Assoc. of Consulting Foresters of America Tennessee Center for Policy Research Red River Coal Company, Inc.

Greg Blankenship James W. Jarrell Maxine Korman President Excavating Contractor Korman Ranch Illinois Policy Institute Jarrell’s Excavating, Inc. Hinsdale, Montana

James Martin Lew Uhler Jerry Fennell President Founder and President Owner, Silver Eagle Mining Co. 60 Plus National Tax Limitation Committee Chairman, Jicarilla Mining District

Paul K. Driessen Jeffrey Mazzella Ken Boehm Senior Policy Advisor President Chairman Congress of Racial Equality Center for Individual Freedom National Legal and Policy Center

Paul Gessing John McClaughry Terrence Scanlon President President President Rio Grande Foundation Ethan Allen Institute Capital Research Center

Mychal Massie David J. McCarthy Tim Cranston Chairman of the Advisory Council Senior Project Manager Director of Operations and Finance Project 21 PSOMAS Property & Environment Research Center*

Richard Falknor Carol LaGrasse Jerry S. Hamilton Executive Vice-President President Environmental Coordinator Maryland Taxpayers Association, Inc. Property Rights Foundation of America Formation Capital Corporation, US

Bruce Colbert Lenore Barrett Dan Byfield Executive Director State Representative President Property Owners Assoc. of Riverside County Idaho American Land Foundation

C. Preston Noell, III Fred Grau Mark Chmura President Executive Director Executive Director Tradition, Family, Property, Inc. Take Back Pennsylvania Americans for the Preservation of Liberty

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Richard Rowland Linda C. Runbeck Dr. Don Racheter President President Founder and Moderator Grassroot Institute of Hawaii American Property Coalition Iowa Wednesday Group

Chuck Cushman Roy Cordato Craig Rucker President Vice President and Resident Scholar Executive Director American Land Rights Association John Locke Foundation Committee for a Constructive Tomorrow

Timothy La Farge Dr. Walter Block Tom Borelli, Ph.D. Former Forest Geneticist Professor of Economics Portfolio Manager USDA Forest Service Loyola University New Orleans Free Enterprise Action Fund

Dane vonBreichenruchardt Dr. Michael Sanera John Taylor President Research Director President U.S. Bill of Rights Foundation John Locke Foundation Virginia Institute for Public Policy

Eugene Delgaudio Jim Vogt James C. Vadnais President President Consulting Forester Public Advocate Taxpayers for Accountable Government Port Angeles, Washington

E. Calvin Beisner Robert T. Fanning, Jr. Ron Arnold Interfaith Stewardship Alliance* Chairman and Founder Executive Vice President Friends of the North Yellowstone Elk Herd Center for the Defense of Free Enterprise

Gary Morrison Dennis LaComb Holt and Jane Hogan Farmer Executive Director Owners United Republican Fund Ontario Hardwood Company

Alan Caruba Franklin Cudjoe Stephen Stone Author and Columnist Executive Director President The Centre for Humane Education RenewAmerica

Rachel Thomas Sharon Votow Tom DeWeese American Citizen Chair President Homestead Land and Water Alliance American Policy Center

Steve Hammond Mary E. Darling Marilyn F. Hayman Paladin for Property Rights Principal Owner Chairman, Citizens for Responsible Zoning Darling Environmental and Surveying & Landowner Rights, Inc.

Alexandra Mulkern Linda C. Runbeck Sam Slom Southern Maryland President President American Property Coalition Small Business Hawaii

Gary Wiggins Sarah Foster Brian Bishop ESAinfo.org Columnist Director WorldNetDaily.com Rhode Island Wiseuse

Judy Boyle Paula Easley Michael H. Smith Property Rights Activist Anchorage, Alaska President Idaho Thomas More Institute

Stephen L. Ralston Gilbert Reeves Leo Schwartz Columbia, Pennsylvania Member Chairman Coalition of Arizona/New Mexico Counties Virginia Land Rights Coalition

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Patrick C. Hughes Mark Pollot Rance Frye Computer Clinic Boise, Idaho Acquisitions Manager Waterfront Group

Henry McCarthy American Citizen

* Organization listed for informational purposes only.

For more information, contact: David Ridenour or Peyton Knight The National Center for Public Policy Research 501 Capitol Court, NE Washington, DC 20002 (202) 543-4110 [email protected] or [email protected]