Big news this week. A major death, really.
When the House of Representatives narrowly passed a bill containing so-called "cap-and-trade," an ugly way of life died. A decades-long (centuries-long?) effort by major polluters to reap short-term profits at the expense of the environment began to be rolled back.
I will delve deeply into cap-and-trade at some point, maybe when it actually becomes the law of the land, after it clears the Senate in some mutilated form. (President Obama will sign the bill, which will turn out to be, in the long run, the most significant accomplishment of his eight years in office.) I'll get into the costs to individuals, to businesses and I'll balance those against the long-term benefits we will begin to reap. I'll mine the details for clues as to the winners and losers under the new system. But for now, this very concise explanation, lifted from the L.A. Times, will have to do:
"The bill would create a system for buying and selling emission permits that give the bearer the right to send carbon dioxide or other greenhouse gases into the atmosphere. Major sources of those gases, such as power plants and factories, would need to obtain enough permits to cover their emissions. Or they would need to cover their emissions with 'offsets,' such as planting trees, that scrub carbon dioxide from the sky."
Translation: major polluters will be allowed to proceed with business as usual, but the financial incentive to mend their ways will be too large to pass up. They will face a choice between throwing millions away each month, each WEEK, on permits... or innovating and investing in greener processes. They will choose option B, out of survival AND responsibility to their shareholders.
Ah, the free market. It's a beautiful thing when properly harnessed.
(Impact on small businesses: that's what I have to research. I'm looking forward to it. Early signs are good, as in "not-too-onerous" as of yet.)
So for the first time in a long time, the nation's most obscene polluters are not setting environmental policy. This means we can begin, with this bill, to reverse course from the wanton destruction -- for nothing more than money! -- of our country and of our planet.
That's cause for celebration.
Now, this from April 2009: "I am a supporter of a strong cap-and-trade system, but I will not and cannot align myself with a giant government slush fund that will further burden our businesses and consumers." That's Senator John McCain. Remember him? He's come out, in the past few years, all over the place on the concept of cap-and-trade. A Google search of his position yields plenty of contradictory articles. If he gets what he wants in the Senate version, it will pass and handily. If he doesn't, we're in for a doozy of a fight.
There are several levels that this kind of legislation bothers me...
ReplyDeleteFirst, it creates a new layer of bureaucracy that needs to be managed and funded. While this may be self funding in the future, it needs start up money and I pretty much think that the Feds have spent their allowance.
Second, any bureaucracy is subject to corruption and mismanagement. The majority of experts that are skilled and available to work in such an agency are currently employed by the business world. Are you going to fine the company that you just left on good terms and where a sizable portion of your 401K is tied up in? Didn't think so.
Third, financial incentive?!?!?!? Contrary to popular belief, businesses don't pay taxes. Consumers pay taxes. If an entire industry passes on the cost at the same time, there is no difference to the business at the large scale. Down chain businesses pay the costs in high energy costs that they pass on to their consumers. Where does it end? The Poor and middle class that are already reeling from the recession.
Fourth, effects on small business are negligable. By itself this may be true, but add additional costs such as healthcare "reforms" and the minumum wage increase that is set for three weeks from now and they add up.
In the end, this is the wrong time to implement this system. Not that I believe in climate change as an emergency either. I understand cleaning up after ourselves and making the best use of the resources that we have. This legislation is too far reaching in an economy that is too fragile, especially in the manufacturing sectors.
Andy, you'll be relieved that I do not wish to destroy ALL of your points. You're welcome.
ReplyDeleteBut I take issue with the first two prings of your argument. And by "prings" I of course mean "prongs."
Science points us to an inescapable conclusion: we have to do something about climate change while we still can. That means the government must play a role. Yes, that means more bureaucracy, more red tape, more corruption... and more results. Dangerous levels of CO2 emissions is not a problem that will self-solve: the federal government, with all its faults, is necessarily part of the solution. The FDA and the TSA and the NTSB waste copious amounts of money. But everyone is glad they exist, because life without them is less safe.
Your third through fifth points are well taken. This endeavor has a cost. But I am glad the Obama administration is willing to take the chance that the long-term savings of addressing climate change NOW will greatly outweigh the short-term costs. In fact, I hope that in his second term, Obama takes a similar approach to Social Security reform, i.e., we have to sacrifice uncomfortably now so our way of life is not compromised a couple generations down the road. Farsightedness is rare among politicians. I couldn't be happier.