I’ll say it again. My Dad was chairman of the local county Republicans in the Eisenhower era. I know what a conservative is. These guys we have today, they’re no conservatives.
In a speech hosted by the Associated Press, President Obama recalled what a lot of people have forgotten, if they ever knew.
“Cap and Trade”, recently a demonized punching bag in the ongoing circus of the Republican presidential primary, is actually a Republican idea.
President Obama reminded Republicans Tuesday that cap-and-trade has GOP roots in a rare public reference to the embattled environmental policy.
“Cap-and-trade was originally proposed by conservatives and Republicans as a market-based solution to solving environmental problems,” Obama said during a fiery speech at a luncheon hosted by The Associated Press.
“The first president to talk about cap-and-trade was George H.W. Bush. Now you’ve got the other party essentially saying we shouldn’t even be thinking about environmental protection. ‘Let’s gut the EPA.’ ”
A detailed history of the Cap and Trade idea was published in the Smithsonian magazine in 2009, – here are a few highlights:
John B. Henry was hiking in Maine’s Acadia National Park one August in the 1980s when he first heard his friend C. Boyden Gray talk about cleaning up the environment by letting people buy and sell the right to pollute. Gray, a tall, lanky heir to a tobacco fortune, was then working as a lawyer in the Reagan White House, where environmental ideas were only slightly more popular than godless Communism. “I thought he was smoking dope,” recalls Henry, a Washington, D.C. entrepreneur. But if the system Gray had in mind now looks like a politically acceptable way to slow climate change—an approach being hotly debated in Congress—you could say that it got its start on the global stage on that hike up Acadia’s Cadillac Mountain.
People now call that system “cap-and-trade.” But back then the term of art was “emissions trading,” though some people called it “morally bankrupt” or even “a license to kill.” For a strange alliance of free-market Republicans and renegade environmentalists, it represented a novel approach to cleaning up the world—by working with human nature instead of against it.
Despite powerful resistance, these allies got the system adopted as national law in 1990, to control the power-plant pollutants that cause acid rain. With the help of federal bureaucrats willing to violate the cardinal rule of bureaucracy—by surrendering regulatory power to the marketplace—emissions trading would become one of the most spectacular success stories in the history of the green movement.
The theory had been brewing for decades, beginning with early 20th-century British economist Arthur Cecil Pigou. He argued that transactions can have effects that don’t show up in the price of a product. A careless manufacturer spewing noxious chemicals into the air, for instance, did not have to pay when the paint peeled off houses downwind—and neither did the consumer of the resulting product. Pigou proposed making the manufacturer and customer foot the bill for these unacknowledged costs—”internalizing the externalities,” in the cryptic language of the dismal science. But nobody much liked Pigou’s means of doing it, by having regulators impose taxes and fees. In 1968, while studying pollution control in the Great Lakes, University of Toronto economist John Dales hit on a way for the costs to be paid with minimal government intervention, by using tradable permits or allowances.
The basic premise of cap-and-trade is that government doesn’t tell polluters how to clean up their act. Instead, it simply imposes a cap on emissions. Each company starts the year with a certain number of tons allowed—a so-called right to pollute. The company decides how to use its allowance; it might restrict output, or switch to a cleaner fuel, or buy a scrubber to cut emissions. If it doesn’t use up its allowance, it might then sell what it no longer needs. Then again, it might have to buy extra allowances on the open market. Each year, the cap ratchets down, and the shrinking pool of allowances gets costlier. As in a game of musical chairs, polluters must scramble to match allowances to emissions.
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Almost 20 years since the signing of the Clean Air Act of 1990, the cap-and-trade system continues to let polluters figure out the least expensive way to reduce their acid rain emissions. As a result, the law costs utilities just $3 billion annually, not $25 billion, according to a recent study in the Journal of Environmental Management; by cutting acid rain in half, it also generates an estimated $122 billion a year in benefits from avoided death and illness, healthier lakes and forests, and improved visibility on the Eastern Seaboard. (Better relations with Canada? Priceless.)
Rachel Maddow has described herself as being almost perfectly aligned with the Eisenhower Republican platform.
That speaks volumes – in so few words.
I was a met tech for a major environmental consulting firm in 1981; we did air quality monitoring for many coal fired powerplant networks in the midwest. It was routine for each company to either trade with each other or even among each company’s own network of plants. For example, if WP&L’s Neenah plant was in danger of violating SO2 standards, they’d just draw down that plant’s operations and let the Decorah plant take up the slack. CO2 trading may need to be tweaked, but the basics are pretty straightforward. Add a revenue neutral business plan, and everything works.
Wondering if anyone has heard on the latest on the EU ETS. I can see honoring it, provided that the tax either a). Can be elimated as a result of some kind of carbon reduction here in the US, or b). Is used specifically for deployment of clean tech in Europe. The theory there being that deployment will benefit all.
Any thoughts out there?
Cheers!
It’s good to see Obama finally taking it to the Republicans for their radical rightward shift. Republicans have messaging skills, but Democrats have reality on their side..
Reality doesn’t mean much inside the bubble. Unfortunately, nothing less than a short, sharp shock will make those who are willfully blind to open their eyes.
During a lavish, mind-numbing 50 minutes of economic statistics and generic platitudes from the heads of the 3 major North American states, President Obama used the words “combat climate change” at 2:35. He singled out Mexico’s leadership – with Harper sharing the stage. A little progress is better than no progress. Keep count. Positive feedback helps.
http://www.whitehouse.gov/photos-and-video/video/2012/04/02/president-obama-holds-press-conference-north-american-leaders
Cap and trade cut sulphur emmissions by 40% in the US and regulation cut emmissions by 70% in Europe ( I think this comes from Sean Otto’s book “Fool Me Twice”). Half a loaf is better than none. While cap and trade is a step in the right direction a carbon tax might be more effective. Revenue from a carbon tax should be used to support renewables and efficiency improvements.
Cap and Trade guarantees a ‘Tragedy of the Commons’ outcome because there is no reward for self-restraint; and there is no incentive to invest in less-polluting alternatives. A Carbon Tax plays into the hands of those who persist in telling themsleves global warming is pyramid-selling scam designed only to increase government revenues.
However, unless or until big business influence upon politics is curtailed, the Fee and Dividend system proposed by James Hansen et al (which is revenue neutral in government terms) will not be possible (because there is nothing in it for businesses that refuse to diversify away from fossil fuels).
Therefore, human survival in anything like current numbers now depends upon popular acceptance of the reality of the nature, scale, and urgency of the problem we face; and acceptance also of the need for radical reform of the way we are governed (in order to make a Fee and Dividend solution implementable).
Looks like we’re all f…
Peter, what would your dad think of Reno, NV’s wind energy investment?
http://www.lasvegassun.com/news/2012/mar/30/nv-energy-windmill-program-generates-rebates-littl/
Excerpt:
“…one turbine that cost the city $21,000 to install saved the city $4 on its energy bill. Overall, $416,000 worth of turbines have netted the city $2,800 in energy savings.”
Ike would not have approved. Do you?
Dad would say, “A fool and his money are soon parted”
This is a variation of the “my uncle Joe smoked 3 packs of cigarettes a day and lived to be 94 therefore cigarettes are good for you” argument. It would be easy to point out the number of false starts or swindles, say, in the internet business, the early PC industry, or the auto industry, for that matter.
And equally deceptive.
That there are sharpsters and shills in Las Vegas is hardly news. That someone like you would pretend to themselves that this somehow reflects the true state of the trillion dollar renewables industry is, well, also hardly news.
What you need to do is get out more and talk to, for instance, utility managers who are deploying wind turbines and producing power cheaper than coal, or entrepreneurs that are pushing the envelope on advanced manufacturing techniques that will make it even cheaper – and employing hundreds of people to do so. These are the kind of meetings I’ve been to in the last few weeks, and the videos will be up soon.
Right wingers hated the early internet too, it was supposed to be a government funded boondoggle – I still remember the “AlGore and his Information superhighway” skits on the limbaugh show long ago. Of course, the renewable industry is going to make the internet revolution seem like a small speed bump. (weird how Gore was ahead of the curve on this one, too….)
Don’t worry, you’ll catch on eventually. I’m sure you’ll say you were for it all along.
I’d say: Always check the source.
Martin – “human survival in anything like current numbers now depends upon popular acceptance of the reality of the nature, scale, and urgency of the problem we face; and acceptance also of the need for radical reform of the way we are governed”.
You have made a prescient observation that some are starting to realize. The essence of governments,corporations, capitalism, and banking is rooted in concepts of compound annual growth rates. Every market based economy uses GNP and growth rates. Yet, compound growth in consumption of raw materials and energy is impossible in the limited ecosystem of the earth. That is why we see peak oil, global warming, etc. all happening at once. Tom Friedman says we cannot expect to consume our way out of this conflict. Yet consumption is the heart and soul of our corporate governance. Consumption is buried deep within our psyche. It is psychological, not merely political. It is a gestalt that governs the culture of our time, at least up until now. The future will have to provide for political and cultural alternatives that mesh with the reality of our human ecosystem, and ones that recognize that sustainable, renewable, ecosystems and cultures have value. We are seeing that conflict played out as we speak. Historians 200 years hence will call this an era of heroic valor, and point to those who grappled with it as legendary.
The focus on extreme Republicans is irrelevant because the Democrats are doing nothing “relevant” to the task at hand.
The oceans WILL die and the environment WILL be destroyed.
The way America allowed manufacturing to move to China has essentially made the whole climate change debate pointless, because their CO2 emissions are going ballistic and far above the USA and the rest of the world combined.
The irony is if the republicans were serious about American jobs they could stop this hypocrisy of allowing business to move overseas to find cheap labor and avoid worker rights and this one fact could do more good then anything else currently being done.
The U.S. Democracy will fail to react until disaster is staring them in the face. The establishment(oil,power,auto,etc) will resist change to renewable energy.
The focus must be on the global warming disasters occurring around the world. The scene will shortly change and both parties will look foolish.
Tornadoes,hurricanes and floods will penetrate populated areas and start killing people on a larger scale, these things will shortly happen and the establishment will not be able to stop change then.
Human suffering will override everything else.
If you drive on a motorway and you suddenly see a barrier in front of you and you realise there is no way out not crashing into that barrier, would you not hit the brakes, would you?
Every little helps.
And it’s our task to open the eyes, the eyes of everyone.
Remaining silent is not an option.