Cap and Trade Doesn't Work
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- bushama
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Obama can learn a thing or two from Europe's scheme.
The Obama administration has, as expected, re-engaged the U.S. in the negotiations for a global climate change mitigation regime after the Kyoto protocol expires at the end of 2012. A bill setting greenhouse gas reduction targets is currently progressing through Congress, with strong backing from the president. But apart from the warm feeling that comes with an improvement in America's international image, what is likely to be achieved in real terms, and at what cost?
To get a good idea, U.S. policy makers need only look across the Atlantic. The European Union, keen to show global leadership, introduced the world's first Emissions Trading Scheme (ETS) in January 2005, just before the Kyoto protocol came into force. The principle of this and similar schemes -- including the proposed U.S. cap and trade regime -- is that certain sectors of industry are allocated permits to emit fixed amounts of carbon dioxide, held to be the primary driver of climate change. If they manage to reduce emissions more than planned, companies can sell their excess permits; if they need more, they have to buy them.
Advocates of the system like it because "the polluter pays." Setting aside for the moment the question of whether it is justifiable to call carbon dioxide a pollutant, companies of course do not simply absorb these extra costs. Instead, they pass them on to their customers who are also, by and large, taxpayers. Not only does the taxpayer carry the cost of any cap and trade scheme, but their money also provides profit for a whole new industry: the new carbon trading sector, the middlemen who make the system work
more at the link:
http://online.wsj.com/article/SB124587942001349765.html
The Obama administration has, as expected, re-engaged the U.S. in the negotiations for a global climate change mitigation regime after the Kyoto protocol expires at the end of 2012. A bill setting greenhouse gas reduction targets is currently progressing through Congress, with strong backing from the president. But apart from the warm feeling that comes with an improvement in America's international image, what is likely to be achieved in real terms, and at what cost?
To get a good idea, U.S. policy makers need only look across the Atlantic. The European Union, keen to show global leadership, introduced the world's first Emissions Trading Scheme (ETS) in January 2005, just before the Kyoto protocol came into force. The principle of this and similar schemes -- including the proposed U.S. cap and trade regime -- is that certain sectors of industry are allocated permits to emit fixed amounts of carbon dioxide, held to be the primary driver of climate change. If they manage to reduce emissions more than planned, companies can sell their excess permits; if they need more, they have to buy them.
Advocates of the system like it because "the polluter pays." Setting aside for the moment the question of whether it is justifiable to call carbon dioxide a pollutant, companies of course do not simply absorb these extra costs. Instead, they pass them on to their customers who are also, by and large, taxpayers. Not only does the taxpayer carry the cost of any cap and trade scheme, but their money also provides profit for a whole new industry: the new carbon trading sector, the middlemen who make the system work
more at the link:
http://online.wsj.com/article/SB124587942001349765.html
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- groups:
- Community, Green, Conservatives for America
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- tags:
- Copenhagen, Trade, CAP
