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The Circular Firing Squad
We liberals are our own worst enemies sometimes. Take climate change. For over a decade we've been promoting the idea of cap-and-trade as a way of dealing with carbon emissions, partly for technical reasons (unlike a carbon tax, it imposes firm caps) but also — in fact, mostly — 
for pragmatic and political reasons. A carbon tax, even if it has some theoretical advantages, is unlikely ever to happen. We all know why. Cap-and-trade, because it uses market mechanisms, has a proven track record with acid rain control, and raises money via auctions rather than taxes, has at least a fighting chance.
So now that liberals are in control of Congress and the White House and have an actual chance to pass legislation, what happens? Everyone starts talking about carbon taxes instead. Because, you know, in some theoretical economic sense you can argue that they're more efficient. It's enough to make you scream sometimes. At least, that's what it did to David Roberts, who must have been reading my mind after digesting Tom Friedman's most recent column:
So now, on the cusp of an enormous fight against dishonest and well-funded proponents of doing nothing, Friedman decides it’s time for “an alternative strategy, message and messenger”? Are you f*cking kidding me?! The only conceivable effect Friedman’s endorsement of an alternative bill can have is to divide support and distract attention from the best chance for a serious energy/climate bill in 30 years. His timing could not possibly be worse.
I’m sure Friedman would respond that hey, he’s not a Democratic operative. He’s an independent thinker. He’s under no obligation to stump for a bill that doesn’t make his mustache tingle. And in this he’s like all progressives. They all want to be the Smartest One in the Room. None of them want to sully their purity by compromising or rowing in the same direction. They all want to show how you clever they are, how their pony plan, their messaging, their strategy is the one those silly legislators ought to be using. Meanwhile, the coordinated opposition kicks their ass, over and over again. But at least they’re clever!
Be sure to read the rest of the rant. As David points out, the key part of cap-and-trade is the cap, not the trade. And contra Friedman, it's not hard to explain a cap on carbon. In fact, it's a lot easier than trying to explain why a tax will reduce global warming. Here's the elevator pitch: "We're going to reduce carbon emissions by setting a nationwide cap on carbon emissions." See? It's easy!
It's true that the trade part of cap-and-trade makes things more complicated, but it's not all that complicated. It's just designed to lower the cost of complying with the cap and make everything a little more efficient. Still, the cap is the key. And as for complexity, anyone who thinks that a carbon tax — an actual, real-world carbon tax, not the chalkboard variety — would be nice and simple, hasn't been paying attention to the way Congress has been making tax policy for the past 200 years. "Simple" is not a word that usually gets used in the same sentence.
Not Circular, Just Not So Straightforward
It's actually worse--Cap and Trade could get a lot of conservative support if it were presented well. However, we on the Left can never get over the thrill of cutting each other's throats for tactical advantage.
You've been quite eloquent about the mechanics of Cap and Trade over the past few months, and have created a plausible story line on how it will reduce emissions without destroying anybody's economy. What I think we need now is a story line from the business point of view. For this I think you need to reverse emphasis, and talk about the Trade, not the Cap. Much in the same way that government support of healthcare should reduce the burden on business, the benefits of trade could be usefully pointed out.
Cap-and-dividend
Kevin, I don't really see how your vilification of those who advocate a carbon tax because they believe it is better, on the merits, than cap-and-trade, is any less of a "circular firing squad" than what you are decrying. With all due respect, your post amounts to wailing that anyone who disagrees with your views on the subject is a traitor to the cause.
If the test of an emissions reduction plan is "what will get the votes of Republicans, conservative coal-state Democrats, and other bought-and-paid-for shills for the fossil fuel industry", then we are guaranteed to have a plan that will do less than nothing to actually reduce emissions.
Personally, I like the "cap-and-dividend" bill, HR 1862, which happens to have been authored by my own Representative, Chris Van Hollen of Maryland. It auctions 100 percent of carbon permits instead of giving them away, contains no phony "carbon offsets," and returns all carbon revenues back to the American public as a monthly dividend. As the Chesapeake Climate Action Network puts it, "It's simple, fair, and built to last."
"If the test of an emissions
"If the test of an emissions reduction plan is "what will get the votes of Republicans, conservative coal-state Democrats, and other bought-and-paid-for shills for the fossil fuel industry", then we are guaranteed to have a plan that will do less than nothing to actually reduce emissions."
So then we should pretty much just give up on the whole idea and find some other legislation to push, right? Who cares about this argument if passing anything meaningful is impossible?
the details matter
I think the reason many liberals (like me) are now worried about cap-and-trade and want a carbon tax instead is that we're realizing that complicated acts of governing are fairly easy for interested parties to undermine. Liberals liked a lot of aspects of medicare prescription drug coverage (especially the basic intent) but the law was essentially written to reach the agreed upon goal through the worst possible (though profit maximizing) path. Cap-and-trade has a million holes compared to a carbon tax that will need to be defended throughout the process, some of which are: indulgences (euphemistically called carbon offsets), determining the capped amount of carbon, auctioning the permits, etc.. So my fear is that we will get a cap-and-trade bill like the EU did: toothless. Or we'll get cap-and-trade that is really just a give away to energy firms (like what McCain proposed). Now I'll support and work towards both solutions, but my enthusiasm is definetly on the side of a carbon tax.
One reason I am worried
One reason I am worried about cap-and-trade is that the versions that are now being proposed as "acceptable" to the fossil fuel industry and its bought-and-paid-for agents in the Congress are very similar to the original EU cap-and-trade system, which was an abject failure.
What we don't need to do is enact a plan that is virtually guaranteed to be a failure and then pretend it is a "victory" and put the problem aside for years until it is too late.
This is a lousy post,
This is a lousy post, because we should never favor lying to people to get our policies passed.
This post is a lousy post because you assume conservatives are stupid. The conservatives killed cap and trade by calling it another form of tax, which it is, so your idiotic lying did no good.
Every gallon of gas we use fuels nations that hate us. Every aircraft carrier, every tank, every jet we make to defend ourselves is a subsidy to the oil industry. A carbon tax taxes all use of that fuel and reduces that use. The proceeds go to alternative, cleaner fuels that make us all safer.
It's not a case of Friedman says yes so you have to say no.
In fact, since carbon taxes are probably better, simpler, and more honest, I'd say it was YOU and your buddies pushing cap and trade that were the bad guys here.
If it's another form of tax it's a pretty peculiar one
anon wrote: "The conservatives killed cap and trade by calling it another form of tax, which it is ..."
Well, yeah, except for the cap part, which a tax doesn't have.
And except for the trade part, which a tax also doesn't have.
And if, as so-called "conservatives" prefer, the tradeable emissions permits are given away to carbon polluters who can then profit by selling the permits they received for free, well that's really "another form of tax".
It doesn't matter
Really, no matter what we do, temperatures will soon reach the point where the feedback effects are irreversible. Civilization as we know it will collapse within the next century.
It's over.
I'll be the contrarian
I'm with Friedman on this one. Whether we prefer cap-and-trade or a carbon tax, drastically cutting our CO2 emissions will require the development of alternative energy technology. Technological advancement is slowed by the fact that, so long as fossil fuels remain cheaper than alternative energy, the market for alternative energy will remain limited to tree huggers like myself, which discourages private sector investment. For a carbon tax to be effective, we don't need fancy computer models to calculate the price at which CO2 levels will drop to agreed-upon targets, we need only ensure that alternative energy is competitive with fossil fuels. The market will take care of the rest.
"For over a decade we've
"For over a decade we've been promoting the idea of cap-and-trade as a way of dealing with carbon emissions, partly for technical reasons (unlike a carbon tax, it imposes firm caps) but also — in fact, mostly — for pragmatic and political reasons. "
(1) Who is "we". I, for example, have been long been vociferous in my support for a tax, and against cap-and-trade for a variety of reasons. The first of these (cap-and-trade will be captured by big interests) looks like it's already happened. The second of these (will cause so much trouble when it becomes time to internationalize it that nothing significant will happen) will play out over the next ten or twenty years.
It's not like any of this stuff is happening in a vacuum. The example of cap-and-trade being captured by special interests has already happened in Europe.
(2) You happily say "cap is the key". Cap at any cost? So how would you feel about a cap that gives me the right to the same amount of CO2 as now, and gives you the right to nothing? Because that's what we're headed for.
Apart from the fact that this is manifestly inefficient, it is also manifestly unfair. And a United States that grows ever unfairer is not a United States that is sustainable. A cap-and-trade system based on giveaways to big oil and big coal is a massive target for GOP exploitation of the resentment already existing towards the financial bailouts.
Cap is unfair?
What is unfair about cap and trade?
The same thing which is unfair about water rights? Spectrum rights? Airspace rights? Cabbie licenses? Fishing licenses?
What, exactly, is 'unfair'?
Quit with your ignorant nonsense
Crissa >"...What, exactly, is 'unfair'?"
The fact that if cap & trade were to become functional these folks wouldn`t have anything to whine about.
“What gets us into trouble is not what we don't know, it's what we know for sure that just ain't so.” - Mark Twain
@Crissa. The goal we
@Crissa.
The goal we presumably want is to make the cost of disposing of CO2 equal to the damage that it causes.
One way to do this is to put a tax on CO2 (ultimately a tax on coal, oil and suchlike) equal to the damage caused. This is fair in that whoever is buying the coal, oil and so on is paying for the ultimate harm that will be caused by their using the fuel.
A second way of doing this to put a cap on the amount of CO2 that can be emitted, and then imposing laws on society to ensure that this cap is met. This could be done in a variety of ways --- for example we could all be given quota books for gasoline ala WW2. But the way economists would prefer this be done is that entities that want to pollute bid for the right to pollute, ie bid for the right to use some portion of this CO2 cap. Once again, in theory, at this point, things are fair --- if you want to pollute to the tune of 15 gallons of gasoline, you conceptually bid for that right against everybody else who also wants to pollute, and given everyone's desires there's some sort of price that clears. (Already at this stage we can see why this is the option beloved by big finance --- the difference between tax and cap-and-trade is basically the difference between the very cheap to run social security and the much more expensive to run individual SS accounts that GWB tried to push on us. Obviously you as an individual are not going to actually get involved in bidding for the rights to 15 gallons of gasoline, so there will be entities intermediating between you and the auction, who will be stripping off their 3% or whatever of the money flow. Also large entities like corporations do now want to have to deal with the volatility in price that a hard cap will generate, so they will buy options, futures and so on to protect themselves against price swings, providing another way for big finance to get its cut.)
But this model described above, where all pollution rights are auctioned off, is NOT what is being proposed in legislation. What is being proposed is to give away auction rights (worth, let's recall, many billions of dollars) to existing entities. HOW EXACTLY is that in any way fair?
And you ask about
- water rights. Yes, the way these are handled in most of the West is ridiculously inefficient and unfair.
- spectrum right. Depends on the part of the spectrum. Some parts are auctioned off, but other parts, like grandfathered in TV and FM/AM rights are, indeed, a giveway.
- airspace rights and cabbie licences ditto.
- fishing licenses I know nothing about. I assume there are parts of the country where they are auctioned off (to the common benefit of society), and other places where they are given away (to the benefit of a few).
Cap and trade is great!
Cap and trade is great! There's no better method to export what's left of American manufacturing to Mexico or China.
But don't worry - we'll still get to enjoy all the global warming caused by the carbon emissions, because it doesn't matter where in the world they're being emitted. And we can bask in the warm glow of knowing that somewhere, some Chinese people are trying to breathe sooty, smoggy air produced by inefficient coal plants which produce the power to run the industries that we're too sanctimonious to allow here in America. And we'll get to import the goods created there!... if any of us have jobs left, since we don't actually make anything anymore.
If you want cap and trade, get China and India on board first. What, can't do that? Well, it won't work without them, whether we do it or not.
Ponies
Well, MY plan, unlike those grubby, compromised plans being debated in Congress, would mandate that CO2 be carried away over rainbows on the backs of ponies.
Why are you selling out, Kevin? Why won't you tell people the TRUTH: that my pony plan is superior. Why would you LIE to people and ask them to support a plan that has NO PONIES?
What's that you say? The pony plan has no chance in hell of being passed into law? By talking about it I'm just pleasuring myself? Wanking off to my own impeccable liberal purity?
Please, don't both me with that kind of grubby compromise and cheap politics. I WANT TO TALK ABOUT MY PONIES.
Look here's the deal, if we
Look here's the deal, if we don't do anything we're dead. If we pass cap and trade the way things look now, we're still dead just about 5-10 years later.
You dead, Marian dead, inkblot and domino dead.
I would have supported cap-and-trade but the situation is now so bad I can't do that anymore because we wont' survive.
I call Congress "simple" all the time
The problem with firm caps is that they don't make economic sense. There is a value to the things we produce that also produce pollution. Setting a cap means that we will likely have a lower national well-being than we would otherwise. The point of regulating carbon emissions shouldn't be "saving the planet" it should be maximizing the benefits of our production/pollution ratio. A carbon tax lets us add in the cost of ecological catastrophe into the economy so that we produce responsibly; a firm cap forces us to assume that there is no value to production beyond a certain, arbitrary point. We should be valuing the environment at a higher price than we do today, but the price should not be infinite, which is what we would have with a cap & trade system.
Re: mario
Mario, that's assuming noone gets around to generating some clean energy when the trade prices for carbon becomes high enough to make it viable.
If Company X switches to windmills powering it's factory then Company X can produce whatever it wants, regardless of the cap on carbon.
Alternatives
Either way, you still get sub-optimal production, even if you choose to ignore the delay in setting up new methods of energy production.
Plus, a carbon tax can be better for the environment. With a carbon cap, no matter how expensive the permits get, you will always have production up to the cap. With a carbon tax, if alternative energies are cheaper and available, they are competitive from widget 1, meaning (theoretically) carbon emissions may stop altogether.
To me, this issue is no different from congestion pricing in cities. When traffic is imposing undue costs on cities, some have responded by taxing each car entering a given amount until the costs equal the benefits received. A carbon cap is instead like setting an artificial limit on the number of cars you let in. No city does that, because the costs imposed by the misallocation of resources would dwarf the benefits of reduced congestion. Nobody wants to turn around an ambulance or tomorrow's bread shipment because the cap has been reached. Allowing the trading of permits doesn't even solve the problem, since that relies on businesses to only consider short-term costs rather than the longer-term costs of allowing new entry into their market or letting their competitors expand.
Friedman in the circle?
I'm sick of the circular firing squad. I feel it, say, today when I go to Common Dreams and find that Obama is a torturer enabler who is bankrupting America. But let's not use Friedman as an example of a liberal Democrat. He's just in his own world, and he's proud of that. If it's actually sounding too liberal for a change, we can scratch our heads or even be grateful.
Thanks for posting this! I
Thanks for posting this! I agree that the most important part of any carbon reduction plan is the cap. Check out this new campaign, a photo petition calling on congress to put a science based cap on carbon: www.putacaponit.org