The answer to the riddle became clear on the train on the way home. I had puzzled about the continued attraction of Cap&Trade. Empirical evidence shows that Cap&Trade does not have a prayer of phasing out fossil fuel emissions fast enough to save the planet, e.g., allowing us to phase-out coal-fired power plants. Clearly there must be people in the Obama administration who understand that. Yet Cap&Trade is still talked about as if it were something good. One wonders: do they really believe we have “a planet in peril”?
The testimony that I gave to the House Ways & Means Committee is available at http://www.columbia.edu/~jeh1/mailings/2009/20090226_WaysAndMeans.pdf
In my testimony I noted that a “Cap” raises the price of energy, just as does a simple honest carbon tax on oil, gas and coal at the first sale at the mine or port of entry. “Cap” is a pseudonym, disguising the fact that it is a tax, assuming that the public is a bunch of dummies, who will never catch on. With all its hooks and eyes, Cap&Trade will allow a lot of funny business. At least we would get a few Wall Street millionaires back in business, via speculation and gaming the Cap&Trade system (funded by John Q. Public, of course).
On the train I read on politico.com that the number of lobbyists in DC working to influence federal policy on climate change increased in the past few years by 300% to 2,340 lobbyists – four climate lobbyists for every member of Congress. At least the alligator shoe business is doing well. Not too good for alligators, though.
A Carbon Tax & 100% Dividend would not let Congress enrich their favorites or divine winning technologies. Instead, the winners would be innovators who invent products with improved energy efficiency or develop carbon-free energies, which allow people to reduce their carbon tax. Of course, if you don’t trust your innovation skills, it is easier to pay a lobbyist to get Congress to adopt a jury-rigged Cap&Trade system.
2340 lobbyists. They are outnumbered by the at least 2500 people, mostly young people (but everybody welcome), who plan to converge on Washington March 2 (despite inclement weather) to peacefully protest the Capitol Power Plant, which our Congress insists must be powered substantially by coal (our coal-black Senate seems to be the culprit). The Capitol Power Plant is just the symbolic target – the real aim is to influence Congress to adopt legislation that will rapidly phase out coal use. See http://capitolclimateaction.org/
The question is: who will Congress listen to? Protesters (bringing no gifts – it’s hard enough to pay their own way) or lobbyists (with lobbying expenditures last year of about $90M).
Young folks, if you need an indication of what you are up against, let me give you one example. Peabody Coal (a.k.a. Peabody Energy) hires Dick Gephardt, paying him $120,000.00 per quarter in 2008. The amount of money going into lobbying is increasing rapidly. As Shakespeare would say, gird up your loins.
If democracy does not win this one, if the lobbyists win, perhaps the best we can do for our grandchildren is buy them a ticket to another planet. Of course, Congress would have to borrow the money from our grandchildren. But at least we would show that we are giving them some consideration.