McCain’s Big Idea On Environment Is Cap-And-Trade?
By Justin Gardner | Related entries in 2008 Election, Barack, Energy, Environment, HillaryFolks, the idea of trading emission credits between companies has been around for nearly 20 years in this country, and McCain has been a proponent for quite some time. And sure, the expansion of the program could help curb some greenhouse gases, but this is McCain’s big idea?
“The United States will lead and will lead with a different approach — an approach that speaks to the interests and obligations of every nation.”McCain proposed a cap-and-trade system, which sets a limit of total greenhouse gas emissions but allows companies to sell unused greenhouse gas emission credits to other firms which have exceeded their quota.
His plan would seek to return emissions to 2005 levels by 2012, and a return to 1990 levels by 2020. It foresees a reduction of 60 percent below 1990 levels by 2050.
And yeah, that’s really about it. Because if you go to the Environment section on McCain’s website, you find 5 paragraphs about how it’s important to protect it. Seriously. His speech is ALL about cap and trade.
On the other hand, if you go to Obama’s website he has 18 different parts to his plan, with cap and trade being the first. He also proposes an immediate tax on corporations in the form of an auction of these credits. McCain would simply give them away.
This is another example where the Obama plan makes more sense. Because if you auction off those credits, the corporations who know they’ll need them will most likely buy them first. And the money raised from those auctions would immediately go to help pay for investment in green tech.
Long story short…this better not be all McCain’s got. Sure, it’s better than the Bush administration’s near total disregard for climate change, but when the bar is so low as to be buried in the ground, it doesn’t help to simply unearth it.
This entry was posted on Tuesday, May 13th, 2008 and is filed under 2008 Election, Barack, Energy, Environment, Hillary. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
May 13th, 2008 at 9:14 am
Been following your blog for a couple of weeks now. Enjoy getting the updates on the US elections. It’s fascinating to watch it all unfold from the other side of the pond.
May 13th, 2008 at 12:11 pm
Justin – Good post. The auction creates essentially a Pigovian tax on carbon emissions. There is a cautionary tale here, though, brought to us by Author Pigou himself in his book “Some Aspects of the Welfare State” (1954) that such a tax assumes certain “givens” — in this case, the profitability or liquidity of a utility company to be able to afford the carbon credits without significant rate hikes to the end-consumers. For this reason, you might want initially a hybrid auction/give away until you can stablize the market.
BTW, McCain said the following in a speech yesterday:
Be carefull about what you wish for.
http://en.wikipedia.org/wiki/Pigovian_tax
May 14th, 2008 at 7:25 pm
[...] I mentioned in yesterday’s post about McCain’s seemingly paper thin plan to help the environment, Obama’s plan would provide immediate funds to help create the technology that will help big [...]