"Ben Nelsons strange stance on cap and trade"
A guest repost from the Wonk Room‘s Brad Johnson.
There seems to be something about climate policy that encourages senators to take positions that are logically impossible. In the latest instance, Sen. Ben Nelson (D-NE) has now managed to simultaneously oppose and support a carbon command-and-control regime. Nelson is one of three Democrats to co-sponsor Sen. Lisa Murkowski’s (R-AK) resolution overturning the EPA’s greenhouse gas endangerment finding, supposedly because “EPA regulations would be a government-directed command-and-control regime”:
I am very concerned about the impact on Nebraska if EPA moves to regulate carbon emissions. Many Nebraska agricultural, industrial and energy-related businesses and organizations have warned about the costs they would have to shoulder from EPA regulations. Because EPA regulations would be a government-directed command-and-control regime, they would raise the price of energy in Nebraska, add greatly to administrative costs, and create new layers of bureaucracy. The burden would fall squarely on Nebraska families, farmers and businesses.
The EPA’s rules will function as a soft cap on large emitters of global warming pollution, most of whom are already covered by Clean Air Act permits for traditional pollution. No new layers of bureaucracy will be created. However, the cost of fossil-based energy would slowly rise. Because it would be legally difficult for the EPA to establish an emissions trading system, companies could not use market means to mitigate those costs.
The ability of trading markets to reduce compliance costs for pollution reduction is the key selling point of a Congressionally established cap-and-trade market as opposed to a command-and-control regime. However, Nelson has also indicated he opposes a cap-and-trade system:
Nelson said he has not had detailed conversations yet with Kerry, Graham and Lieberman. But he said he is open to negotiations on setting a limit on greenhouse gas emissions. “I want to see what the legislation does,” he said. “I said I can support cap. I have trouble with cap and trade, the trade part of it. So if it’s cap and trade, watered down, and it’s only the trade watered down, that won’t satisfy me.”
A cap without “trade” is by definition a command-and-control regime “” which Nelson has said he opposes on economic grounds. But he claims to oppose a cap with “trade” on populist grounds. In short, he’s using logically inconsistent excuses to block both executive branch and legislative branch action on global warming.
Nelson may be trying to pander to polls, which show that the phrase “cap and trade” is unpopular by comparison to Americans’ desire for the government to regulate polluters and support clean energy investment. Or maybe he’s pandering to his corporate polluter donors, who need senators like Nelson to maintain the Bush-Cheney status quo.
JR: Is it possible to have a cap without the trade that isn’t command-and-control? Maybe. I’m working on just such an idea. I”ll report when it is fully baked!