Enact a Carbon Tax, Not a Cap-and-Trade System | Henry Auer

The worldwide need to abate emissions of greenhouse gases is becoming more important with every passing year. Nevertheless, the U. S. has never enacted federal legislation that would limit its emissions.

This post describes a proposal for a cap-and-trade market mechanism to lower greenhouse gas emissions in the U. S., presented in a recent op-ed article. Then cap-and-trade is compared with a direct tax or fee on carbon fuels.

It is concluded that a carbon tax or fee is far more advantageous than a cap-and-trade mechanism, for its effectiveness, efficiency and freedom from the need to create a new bureaucracy to oversee its operation. The revenues generated can be applied in a variety of ways that would be politically acceptable. Adoption of a carbon tax or fee in the U. S. is strongly recommended.

Introduction. The nations of the world are currently on a path of emitting greenhouse gases (GHGs) that risks putting humanity in great climatic peril by the end of this century. A principal GHG is carbon dioxide (CO2) emitted when we burn fossil fuels for energy. Annual rates of emission while doing “business as usual” (which assumes no meaningful reductions) or only modest rate reductions lead to unacceptably high levels of total accumulated atmospheric GHGs. It is this accumulated total (not the annual emissions rate) that determines the extent of global warming that we experience. Thus, although it may sound virtuous to reduce annual emission rates, the new GHGs that are still emitted continue to accumulate to ever higher levels. Only global emission rates approaching zero suffice to stabilize the global atmospheric GHG burden, leading to stabilization of global average temperature at some value higher than we have today.

For more on this story, visit: Global Warming Blog by Henry Auer: Enact a Carbon Tax, Not a Cap-and-Trade System.

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