The Hill‘s blog has a post, “Why kill cap-and-trade? Because it’s there.”
The NYT‘s John Broder had a piece, ” ‘Cap and Trade’ Loses Its Standing as Energy Policy of Choice.”
CBS reports of the forthcoming Graham, Kerry and Lieberman bill, “notably missing from it will likely be the cap-and-trade system that had not long ago been expected to be the centerpiece of any legislation.”
Peter Barnes comments on my blog, “If cap-and-trade is politically dead, why not try some version of cap-and-dividend?”
Two points. First, the bipartisan bill will have a cap. And it appears almost certain it will have a trading system. But such is the world we live in that this isn’t cap-and-trade.
I’ve said many times it is crazy from a communications perspective to build your core message around a process — “cap-and-trade” [or health care reform] — rather than an outcome, like clean air or clean energy jobs. If it needs a name, let’s call it “puppy.” We can call cap-and-dividend “baby seal,” since it has a cap and a trading system, too.
Second, conventional wisdom says we probably won’t get a climate bill this year, whatever it is called. But that’s not because of “cap-and-trade.” As Harvard economist Robert Stavins explains in “Who Killed Cap-and-Trade?“:
A Rapid Descent From Politically Correct to Politically Anathema
Among factors causing this change were: the economic recession; the financial crisis (linked, in part, with real and perceived abuses in financial markets) which thereby caused great suspicion about markets in general and in particular about trading in intangible assets such as emission allowances; and the complex nature of the Waxman-Markey legislation (which is mainly not about cap-and-trade, but various regulatory approaches).
But the most important factor “” by far “” which led to the change from politically correct to politically anathema was the simple fact that cap-and-trade was the approach that was receiving the most serious consideration, indeed the approach that had been passed by one of the houses of Congress. This brought not only great scrutiny of the approach, but “” more important “” it meant that all of the hostility to action on climate change, mainly but not exclusively from Republicans and coal-state Democrats, was targeted at the policy du jour “” cap-and-trade.
The same fate would have befallen any front-running climate policy.
Does anyone really believe that if a carbon tax had been the major policy being considered in the House and Senate that it would have received a more favorable rating from climate-action skeptics on the right? If there’s any doubt about that, take note that Republicans in the Congress were unified and successful in demonizing cap-and-trade as “cap-and-tax.”
Likewise, if a multi-faceted regulatory approach (that would have been vastly more costly for what would be achieved) had been the policy under consideration, would it have garnered greater political support? Of course not. If there is doubt about that, just observe the solid Republican Congressional hostility (and some announced Democratic opposition) to the CO2 regulatory pathway that EPA has announced under its endangerment finding in response to the U.S. Supreme Court decision in Massachusetts vs. EPA….
In general, any climate policy approach “” if it was meaningful in its objectives and had any chance of being enacted “” would have become the prime target of political skepticism and scorn. This has been the fate of cap-and-trade over the past nine months.
Precisely.
The notion that cap-and-dividend … I mean, baby seal … is somehow intrinsically more palatable to the opposition than, say, puppies is nonsense. The point is they are both cute animals, and conservatives don’t like cute animals because they stand in the way of unrestricted pollution and our continued addiction to fossil fuels. Why do you think they want to off the polar bears? (see “Palin’s axis of evil animals: Beluga whales join polar bears and wolf cubs“).
I mean, look at the Tea Partiers, the source of the sign above. Obama is being attack as an anarchist and/or socialist for supporting a market-based approach to reducing pollution first advanced and signed into law by President George W. Bush’s father!
What’s most pathetic — and, I think, missing from some of the analysis on the death of “cap-and-trade” — is that most everybody in the media and political establishment is quite convinced the issue is a political loser when the recent polls say otherwise:
- Memo to policymakers: Public STILL favors the transition to clean energy
- Swing state poll finds 60% “would be more likely to vote for their senator if he or she supported the bill” and Independents support the bill 2-to-1 (9/09)
- New CNN poll finds “nearly six in 10 independents” support cap-and-trade (10/09)
- Voters in Ohio, Michigan and Missouri overwhelmingly support action on clean energy and global warming (11/09)
- Overwhelming US Public Support for Global Warming Action (12/09)
- Public Opinion Stunner: WashPost-ABC Poll Finds Strong Support for Global Warming Reductions Despite Relentless Big Oil and Anti-Science Attacks (12/09)
- It’s all about Independents “” and Independence (1/10)
- Yale: When asked whether they “support or oppose regulation carbon dioxide”¦as pollutant,” 73 percent said yes, with only 27 percent opposed, including 61 percent of Republicans (2/10)
That’s true even if you ask them directly about the dreaded “cap-and-trade” (from January):
The public still supports strong action to regulate greenhouse gas pollutions and promote clean energy jobs. They love puppies and kittens:
I’m not saying the messaging failure is the sole reason the conventional wisdom has declared a climate bill all but dead. But when the high level messaging by leading politicians is so bad, it simply becomes impossible to disentangle the contribution of bad messaging from other factors, like the bad economy or, say, different policy choices.
Related Posts:
- Lindsey Graham: “Every day that we delay trying to find a price for carbon is a day that China uses to dominate the green economy”
- Graham: “The idea of not pricing carbon, in my view, means you’re not serious about energy independence. The odd thing is you’ll never have energy independence until you clean up the air, and you’ll never clean up the air until you price carbon.“
See also Kate Sheppard’s MJ post, “Cap and Trade is Dead. Long Live Cap and Trade!”
Previous in TP Climate Progress
Language Intelligence: Lessons on persuasion from Jesus, Shakespeare, Lincoln, and Lady Gaga
The Coffee Party climate change forum is revealing as to how engaged people are in the effort to confront the threat:
http://coffeepartyusa.com/content/climate-change
Just To Be Clear, Two Different Questions
These are two different questions — related in some ways but very different in others:
1. Would ANY leading approach (that is, approach making legislative progress) for reducing GHGs, via legislation, be subject to intense dislike from some powerful political and ideological camps?
2. Are all approaches the same in terms of their likely effectiveness in reducing emissions, eventual attractiveness to the broad public, eventual “sustainability” (as legislation), and etc.?
The answer to the first question is “yes”, as the post suggests.
The answer to the second question is “no”.
I still cannot see why (all else equal) a dividend of money back to the public would not be more attractive, fair, sustainable, do-able, and so forth than a comparable approach that does not involve giving money back to people. I’m a person. I’d like getting money back. That would motivate me to use less gasoline AND to support a continuation of the legislation.
I’m not an expert on all the latest proposed legislation, but (I must admit) reading Barnes’ book long ago seemed to provide a good glimpse of an attractive answer, if you ask me. I’d like to meet the guy and congratulate him! I don’t really understand the problems with that approach or, at least, if there are a couple tangential problems, why they can’t be dealt with and resolved? This whole thing is becoming far too complex, and voters are going to reject it out of complexity alone. Haven’t we learned that, yet?
A proposal must make sense, it must be clear (in its essence), it must be easily explainable, it must NOT cater to the entrenched interests that the public do not want to cater to, it must be economically fair and reasonable to the public (an advantage of the dividend approach), and above all it must be effective.
What else can be said? If we end up with a complex approach that doesn’t meet ALL of these requirements, forget it. Game over. Done. If it can’t be explained, I’m not supporting it. If it actually DOES cause poor people intense hardships (by raising energy costs while not rebating the money), I’m not supporting it. If it creates easy loopholes, I’m not supporting it. If it caters to ExxonMobil, I’m definitely not supporting it.
How clear can I be?
Sigh,
Jeff
Well, its going to be lots warmer in the 2010s. Here is my attempt to explain this as simply as I can, based on the physics:
http://www.realclimate.org/index.php/archives/2010/03/unforced-variations-3/comment-page-12/#comment-168530
Unfortunately, I find I can’t write at the “high school level” which would communicate more widely. Anyone who knows how is free to start from my analysis and carry on.
It’s spelled “ideologue”, not “idealogue”. That’s because they have ideologies instead of ideas.
[JR: You are so right. I keep thinking they have ideas. My bad!]
I’ll take the comment from the movie WarGames (1983) ‘I’ll piss on a spark plug if I thought it would do any good.” Therefore, any system that reduces carbon fuel usage that can get passed in our wonderful political system I’ll be for.
My own preference is for a carbon fuel tax that would substitute for other taxes. Part of the reason I’m for it is I’ve convinced 3 conservatives acquaintances who I discussed/debated with that the carbon would work, at least for our state.
If we replaced our property tax for a state gasoline tax, we would be spending less money on the actual gasoline as well, because we would be using less of it. Plus, since a lower property tax would mean potentially more expensive building real estate, that would allow more jobs in our state for that. Buildings usually are 1/3rd materials and 2/3rds labor. The labor costs/income would be generated in my state.
Or would California have the problems they are having I they had gasoline tax money going to the state government. Has anybody done an analysis on what the gasoline tax would be to balance that states budget. (If California was its own country, it would have the second highest total usage of gasoline)(at least as a few years ago)
Don’t underestimate those gun toting mamas. The extreme Right and Left are a lot alike- most of the Symbionese Liberation Army and Badher- Meinhof Gang assassins were women.
Please watch this public statement from two EPA attorneys against cap-and-trade: The Huge Mistake
This cartoon is also illustrative: Carbon Offset Scam
On the lighter side, two Brits absolutely skewer the concept: Cheat Neutral
Cap and Trade would make the problem worse.
Raindrops on roses and whiskers on kittens;
Bright copper kettles and warm woolen mittens;
Brown paper packages tied up with strings;
These are a few of my favorite things.
Cream-colored ponies and crisp apple strudels;
Doorbells and sleigh bells and schnitzel with noodles;
Wild geese that fly with the moon on their wings;
These are a few of my favorite things.
Girls in white dresses with blue satin sashes;
Snowflakes that stay on my nose and eyelashes;
Silver-white winters that melt into springs;
These are a few of my favorite things.
When the dog bites,
When the bee stings,
When I’m feeling sad,
I simply remember my favorite things,
And then I don’t feel so bad.
–Oscar Hammerstein II and Richard Rodgers
The entire climate “policy” debate in this country seems to have degenerated to a battle of politics and semantics. Real policy analysis gets about as much attention as graffiti on an alley wall.
For example, Stavins asks, rhetorically, “Does anyone really believe that if a carbon tax had been the major policy being considered in the House and Senate that it would have received a more favorable rating from climate-action skeptics on the right?” We’re all supposed to respond “No”, but can Stavins explain why? Isn’t it something of a paradox that climate-action skeptics would prefer the “environmental certainty” of cap-and-trade over the “price certainty” of a tax?
I’m not advocating a “carbon tax”, but I’m questioning whether Stavins or anyone else is capable of piercing the veil of politics and semantics that obscures policy logic.
@Jeff:
I’m afraid that rebates to the common folk would be viewed as “pure communism” by the leaders of the right, and their droves of followers would act accordingly, regardless of the fact that they would, as a group, benefit from the payback. Something about cutting off their noses to spite their faces, which has become a common theme amongst that very vocal contingent. While the idea sounds good to me, as it would promote bottom up efficiency increases, I don’t see it as very viable in the current political climate for at least another few generations. The communist threat still exists in the minds of many voting Americans. There isn’t time for that idea to become popular (to put it bluntly, sadly that will probably require a reduction in the percentage of Americans who remember the “red threat” and can be victim to scare tactics using the word communism).
I would suggest a low/no interest loan bank for energy projects be created with the money instead. Power providers would be forced to pay into the bank as part of a “cap and trade” measure, but then could borrow virtually all of it back from that same bank at little or no interest for clean energy projects (which should be allowed to include homeowner/business installations of renewable energy generation). Generally legislation works best if there is both carrot and stick being used. This would help keep the books more revenue neutral for power providers, which is important to the shareholders and the companies’ credit ratings, while holding prices down for users. Basically the “tax” would be used to fund infrastructure instead of going to Uncle Sam to inevitably be spent on something else. Most power companies need to invest in continuous upgrades anyhow.
Like a mortgage to a homeowner, the payment amount is more important than the cost. If the cost of a facility is amortized over a 30 year bond, and money for non-green energy projects must be borrowed on the market at around 5.3%, versus 0% for green energy projects, the green energy project can cost twice as much to construct but still result in the same monthly bond payment. Current interest rates for utilities are pretty close to 5% and rates have nowhere to go up, so that rate is reasonable. So if the option is spending $200M on a clean energy project versus $100M for a non clean energy project or upgrades, the carrot could become very strong. While there a lot of things I don’t like about this idea, it seems much more feasible than any payback scheme due to simplicity and support from utilities. We should still tax emissions on top of that, but this could be a much stronger force than a tax alone, which would have to start out comparatively weak to be politically viable. As a short-term measure where expediency trumps “fairness,” I think this is a better idea.
#2 – Jeff
I agree completely with you. It must be easy to explain and implement but the key is the dividend. Every month to every person in the country. As Mike Tidwell from the Chesapeake Climate Action Network has pointed out often, once dividend payments begin, they become entitlements. There is not a political force on earth that can kill an entitlement.
I like Brendan’s idea: Not cap and trade but a Feebate: “Bank and Fund”
“Power providers would be forced to pay into the bank as part of a “cap and trade” measure, but then could borrow virtually all of it back from that same bank at little or no interest for clean energy projects”
In reference to the post title, I would like to propose that the legislation and debate be refered to as “Pro-Life 2″. This would be a reference for the health wellbeing and life of those already born, especially the children.
By all accounts, the Senate “climate change legislation” that Kerry, Lieberman and Graham are cooking up will be essentially the McCain/Palin 2008 “energy plan”: expand offshore oil drilling, and squander vast resources on the “clean coal” hoax and the nuclear boondoggle; with comparatively small “incentives” for renewables, while placing no real limits on GHG emissions.
Is there a chance that the Senate will pass something called a “climate / energy bill” this year? I suppose so.
Is there a chance that the Senate will pass legislation that comes anywhere near to actually doing what climate scientists tell us needs to be done if we are to have any hope of averting the worst consequences of AGW? I don’t see it.
ANY policy that changes the status quo will be smeared, distorted, mischaracterized and attacked by the defenders of the status quo.
So, they can flee from C&T to some new policy but, unless it’s a complete capitulation, that new policy will, in turn, be smeared, distorted, mischaracterized and attacked by the defenders of the status quo. (i.e. “swiftboated”)
Will they, then, run to some new seemingly safe place?
When do they stop running and stand their ground and fight back?
All that said, I do think the emphasis on trade should be dropped – not at all pleased that we’re “counting” on corrupt Wall St types to put climate policy in place after all they’ve put us through.
However, keep the emphasis on “cap carbon.” Cap and cut carbon pollution. That is our real goal!
And protect those beautiful mountains!