The rush is on to conclude a global compact on climate change before the signing session due to take place in Copenhagen in December. European political leaders, scientists and legal experts have descended on Washington in recent weeks to educate the administration and the Congress on the importance of U.S. making the right decisions to make the new treaty successful. The key problem is how to set a lowered ceiling on carbon dioxide emissions. The main mechanisms under discussion are so-called cap and trade regimes by which nations or firms that exceed their ceiling can purchase credits from those who have not reached their limit. Europe has used this system for some years to meet the targets of the Kyoto Protocols and failed to attain the targeted reductions, even as the markets for carbon permits have proved unpredictable.
American policymakers ought to weigh Europe’s failure in their decisions. Cap and trade is popular in Washington for two reasons. It allows smokestack industries to buy their way out of adjustments they don’t want to make; and it has the appearance of expanding free-market practices, giving high-priced jobs to economists, traders and accountants, rather than allowing modestly paid bureaucrats to impose unwanted restrictions on business. If, however, the world’s largest experiment in cap and trade is a failure, then we ought to admit before we start that it is simply a way for the unwilling to evade responsibility and save ourselves thetrouble of creating ineffective legislation that will only worsen atmospheric conditions for centuries to come.
A simpler and more effective carbon tax proposal has been introduced in Congress by Congressman John D. Larson, Democrat of Connecticut. Right now it not regarded as politically feasible. The ideological momentum is behind carbon trading. But, if a carbon tax is made revenue neutral–Mr. Larson would balance it with lowered payroll taxes–and not add to the bureaucracy, it is conceivable it could become politically viable. How could the ideologues reject an effective remedy for CO2 emissions that comes at no added cost? Let’s watch and see.
Drew Christiansen, S.J.