Michael Schellenberger and Michael Nordhaus already have taken plenty of heat from the enviro/left for their book Break Through: From the Death of Environmentalism to the Politics of Possibility. Their latest article in the American Prospect is not going to mend any fences. Schellenberger and Nordhaus write:
Like conservatives who see tax cuts as the solution to all problems, greens are now offering carbon auctions and energy taxes as the answer to the economic crisis. “Capping global warming pollution and auctioning off the pollution rights will inject $150 billion into the economy each year,” Krupp of EDF told his members in an Oct. 24 e-mail. But auctioning carbon permits does not, in fact, inject any new money into the U.S. economy. Requiring industry to purchase pollution permits functions the same as a tax.
President-elect Barack Obama even admitted as much to the San Francisco Chronicle earlier this year:
Under my plan of a cap and trade system, electricity rates would necessarily skyrocket. Even regardless of what I say about whether coal is good or bad. Because I’m capping greenhouse gases, coal power plants, you know, natural gas, you name it – whatever the plants were, whatever the industry was, uh, they would have to retrofit their operations. That will cost money. They will pass that money on to consumers.
Unfortunately far too few on the left are willing to admit, or even understand these basic facts. The Center for American Progress’ Matthew Yglesias writes:
[I]t’s worth noting how odd it is that the United States has the kind of highly ideological and deeply shortsighted business community. There’s no way a serious climate policy could be anything other than bad for oil companies and catastrophic for coal companies. But for most companies? Well, there shouldn’t really be a general problem. Firms whose operations are more carbon intensive than the average firm would be put at a competitive disadvantage, but by the same token firms whose operations are less carbon intensive than the average firm would be given a leg up. And there should be half of each.
Half of each? How does he figure that? All companies use energy and all of them would be severely hurt by an energy tax. Most companies, and the vast majority of small businesses, have no idea where there energy comes from. Firms generally best succeed when they manage to narrow the focus of the company’s resources to their main field of competence. Forcing every business in America to be an expert on energy in addition to what they already do best (whether it be writing software, managing risk, building bicycles, etc.) will only retard economic growth.
Oh and did we mention that even if it is 100% successful cap and trade will do nothing to prevent global warming?