cap and trade versus a carbon tax

[santafe2]

Re: cap and trade versus a carbon tax

Coal and politics?

The next bubble is forming. As we debate the details of carbon tax vs. cap and trade, don't forget that money is looking for an investment vehicle and apparently it has decided that cap and trade is the best way to reinflate the economy. We can make moral/practical/ethical arguments until we can no longer type, but the bubble is forming and cap and trade will likely be its vehicle.

[c1ue]

Re: cap and trade versus a carbon tax

SF,

I think you have a slight misapprehension there.

Cap & Trade is the best way to

1) shield the domestic economy from imports (or else watch even more internal manufacturing disappear)
2) generate fees for the investment banks
3) shove unpalatable taxes and policy down public throats

A bubble isn't needed for any of the above.

Sir Warren's point also is that the imposition of this tax is just going to hurt the American economy more. As a nation already in the deep manufacturing hole - adding extra cost to making anything here is just going to worsen the situation.

It is quite debatable how much investment money is able to go in (and stay in) once the net economic effects of this tax (and increased income, state, local taxes) are felt.

As one simple possibility: import barriers result in currency account going positive/trade surplus. Rest of world stops buying Treasuries as there is no longer any reason whatsoever to buy dollars. Interest rates shoot to 15%.

15% Treasuries vs. alternative energy investments? I know which way I'd go.

[Starving Steve]

Re: cap and trade versus a carbon tax

Alternative energy investments?

I just listened to Obama's speech to-day about buildings which are powered by geo-thermal wells. Please think about this: What would a geo-thermal well cost and a power system for such?

This all is nonsense, like everything else coming from the eco-frauds: long on hope and short on details; long on promise and short on economics.

Please learn something from BC Hydro's adventure into tidal power which sounded so promising. Well, the sad fact is that BC Hydro now is so short on power that since 2001 BC has been importing power from the Pacific Northwest states.

Go to BC Hydro's website to find-out about the tragedy of BC's new power rate for homes. And once there, you get a barrage of BS. You get the touchy-feely nonsense that the new electric power rate is 8+ cents per kwh for conservers.

The sad fact of life is that no-one can live hanging clothes in their house to dry, especially in the damp air of BC. And then no-one can really refrigerate food without risk of food poisoning at 4 degrees C.( 39F ).

But if you smoke pot long enough, this rubbish about the BC Hydro conservation rate discussed at the BC Hydro website may make sense. Quite hidden from readers is the real truth about the power increase now occurring in BC, and the new rate is more like 14cents per kwh due to the failure of alternative energy, especially tidal power, to produce meaningful amounts of energy.

And quite hidden from Americans who listened to Obama's speech to-day are the sad facts about solar power, wind power, geo-thermal power, etc.

You might peruse BC Hydro's BS. Once you get to the "File not found" page, click electric rates just down the page. The fun begins then.....

http://www.bchydro.com/electric

[santafe2]

Re: cap and trade versus a carbon tax

SF,

I think you have a slight misapprehension there.

Cap & Trade is the best way to

1) shield the domestic economy from imports (or else watch even more internal manufacturing disappear)
2) generate fees for the investment banks
3) shove unpalatable taxes and policy down public throats

A bubble isn't needed for any of the above.

Sir Warren's point also is that the imposition of this tax is just going to hurt the American economy more. As a nation already in the deep manufacturing hole - adding extra cost to making anything here is just going to worsen the situation.

It is quite debatable how much investment money is able to go in (and stay in) once the net economic effects of this tax (and increased income, state, local taxes) are felt.

As one simple possibility: import barriers result in currency account going positive/trade surplus. Rest of world stops buying Treasuries as there is no longer any reason whatsoever to buy dollars. Interest rates shoot to 15%.

15% Treasuries vs. alternative energy investments? I know which way I'd go.

That's a lot of interesting speculation c1ue. I'd find the post much more helpful if you'd focus on one of these subjects like: How cap and trade will shield the domestic economy from imports and keep jobs from moving off-shore. Maybe you can start a new thread. Maybe we can have a section devoted to cap and trade so we could really begin to break this thing down....but now I'm just dreaming...

[Starving Steve]

Re: cap and trade versus a carbon tax

That's a lot of interesting speculation c1ue. I'd find the post much more helpful if you'd focus on one of these subjects like: How cap and trade will shield the domestic economy from imports and keep jobs from moving off-shore. Maybe you can start a new thread. Maybe we can have a section devoted to cap and trade so we could really begin to break this thing down....but now I'm just dreaming...

Providing details, especially economic details, about proposals and promises is not what environmentalists ever do. So no surprise that cap- and-trade may sound promising, but no details are provided.

Some clues about the failure of tidal energy which once looked so promising to British Columbia: 1.) Where does BC Hydro discuss the success of tidal energy on its website? It doesn't. 2.) Why does BC Hydro want to privatize its energy generation, because if tidal projects were so profitable, privatizing such projects would make no economic sense. 3.) Where are the high tension lines carrying away the energy from Sooke Harbour which has a tidal power station? They don't exist. 4.) Why is BC Hydro now in shortage of power and importing energy from the Pacific Northwest states? BC Hydro has been in power deficit since 2001. 5.) Why are our power rates in BC going sky-high, and why are those new rates hidden from the public in PDF files at the BC Hydro website?

[santafe2]

Re: cap and trade versus a carbon tax

Providing details, especially economic details, about proposals and promises is not what environmentalists ever do. So no surprise that cap- and-trade may sound promising, but no details are provided.

Some clues about the failure of tidal energy which once looked so promising to British Columbia: 1.) Where does BC Hydro discuss the success of tidal energy on its website? It doesn't. 2.) Why does BC Hydro want to privatize its energy generation, because if tidal projects were so profitable, privatizing such projects would make no economic sense. 3.) Where are the high tension lines carrying away the energy from Sooke Harbour which has a tidal power station? They don't exist. 4.) Why is BC Hydro now in shortage of power and importing energy from the Pacific Northwest states? BC Hydro has been in power deficit since 2001. 5.) Why are our power rates in BC going sky-high, and why are those new rates hidden from the public in PDF files at the BC Hydro website?

Starving - Try not to be so totally off point. If you want to hammer this project please do it on your own thread and everyone can discuss it's various merits, (or lack thereof), on that thread. In the US we are getting some form of cap and trade legislation. I for one would like to understand it better and the above is just creating noise and detracts from the intent of the thread. In fact, the thread originator started this thread because the original one had become so polluted with global warming tirades he thought it useless to begin a pared down, more focused discussion there.

[wayiwalk]

Re: cap and trade versus a carbon tax

I agree with Jtabeb, he really nailed it to the core, as far as the underlying ideas pushing cap and trade forward.

I'd add by making reference to the analogy of a wolf in sheeps clothing; by bundling a social concern with a plan to further tax the people, you get 3/4 of the news media on your side to help sell the plan.

The straight ahead tax on carbon is simple, would be "fair", if there is any such notion as fair with adding new tax burdens on the economy. If you look at the types of programs our government creates these days, simple is not a typical description. That also eliminates it from consideration.

I apologize in advance for thread drift, but it really is funny to me that as legislation gets more and more convoluted and complex, congress seems to spend less and less time even concerning themselves with the details of these bills.

Where is that all headed?

[santafe2]

Re: cap and trade versus a carbon tax

I agree with Jtabeb, he really nailed it to the core, as far as the underlying ideas pushing cap and trade forward.

The straight ahead tax on carbon is simple, would be "fair", if there is any such notion as fair with adding new tax burdens on the economy. If you look at the types of programs our government creates these days, simple is not a typical description. That also eliminates it from consideration.

I agree with the point you and Jtabeb are making. There is no doubt that cap and trade is a less transparent vehicle for accomplishing this task of re-pricing carbon emissions. My industry, (renewable energy), had backed a carbon tax for years but more recently has backed the Waxman-Markey bill as it became obvious that this bill had the support to be passed into law. At this point I agree with that position and have been swayed toward cap and trade because of the reasons I stated before. That is, I like the CAP in cap and trade. The TRADE is where the issues lie. I'm as concerned as many here, that's why I'm spending so much time trying to parse this issue out and understand its components.

[c1ue]

Re: cap and trade versus a carbon tax

I'd find the post much more helpful if you'd focus on one of these subjects like: How cap and trade will shield the domestic economy from imports and keep jobs from moving off-shore.

SF2,

That a carbon cap and trade will be used to shield domestic industry is no speculation.

If it were so then why would China feel obligated to warn the US against protectionism?

http://www.chinaeconomicreview.com/i...ectionism.html

Under the bill, the US government could levy import taxes on foreign manufacturers shipping goods to America as a penalty for the carbon contained in those goods. US Energy Secretary Steven Chu told Congress in March that the carbon border tax would help "level the playing field" with countries that have looser carbon standards.

Seems quite clear to me - a bill on the Congressional agenda and a Cabinet minister speaking to it.

The only speculation in my previous post was listed as such: one way which unintended consequences backfire.

[santafe2]

Re: cap and trade versus a carbon tax

SF2,

That a carbon cap and trade will be used to shield domestic industry is no speculation.

If it were so then why would China feel obligated to warn the US against protectionism?

Thanks c1ue. I wasn't following your argument. I don't think it's correct to characterize cap and trade as a shield. Today, that tax does not exist. When it does it will raise the price of domestic products. Other nations who do not share our values and don't have the same cost burden, should be taxed at the border to allow us to exert our will and our values as a customer.

Although we could do a much better job, we pressure China with regard to many of our Western values; child labor, work hours, work conditions, etc. All of these could be considered protectionism under your definition. Maybe we need another vendor or a whole lot less of the products we get from China. I'd vote for the later but I've already gotten well off topic so I'll stop.

[BuckarooBanzai]

Re: cap and trade versus a carbon tax

Well, I thought this was pretty funny:

[Starving Steve]

Re: cap and trade versus a carbon tax

Starving - Try not to be so totally off point. If you want to hammer this project please do it on your own thread and everyone can discuss it's various merits, (or lack thereof), on that thread. In the US we are getting some form of cap and trade legislation. I for one would like to understand it better and the above is just creating noise and detracts from the intent of the thread. In fact, the thread originator started this thread because the original one had become so polluted with global warming tirades he thought it useless to begin a pared down, more focused discussion there.

I was trying to hammer home the point on how eco-nuts snow the general population with mis-information. I am lost on Cap-and-Trade, and I would like a lot more economic information about it. Snow jobs are simply unacceptable.

To show how the eco-nuts snow the people, I showed what happened in BC with their tidal power. I carefully reasoned-out why their entire tidal project in Sooke Harbour was a failure. All of the investments by BC Hydro in alternative energy have been a failure, and since 2001 BC has been importing electricity from the Pacific North-west states.

I was not off-thread. I was dead-on the thread. I want the economic details of Cap-and-Trade flushed-out. I don't want to hear endless promises about Cap-and-Trade because we have been down that road before: the snow job road.

I listened to President Obama's speech on Cap-and-Trade, and it was long on hope and short on economic details.

No, I think I hit the nail correctly on the head on this thread.... High time that the public did some critical thinking and demand the details about whatever the environmental lobby is proposing. And President Obama seems to be in bed with the environmental lobby.

[santafe2]

Re: cap and trade versus a carbon tax

No, I think I hit the nail correctly on the head on this thread.... High time that the public did some critical thinking...

Of course you did. My bad...:rolleyes:

[santafe2]

Re: cap and trade versus a carbon tax

Both seem to be credible Non Profits that produce good research but with a political slant.

Their slant/lie was to show that the poorest quintile would suffer the greatest pain from cap and trade. Were the revenues used equally among all citizens this would be true but of course it's not. The bottom quintile will be subsidized to make this revenue neutral. As I pointed out in another post, the middle class will bear the brunt of this legislation. I think they have the fewest lobbyists.

[we_are_toast]

Re: cap and trade versus a carbon tax

Santafe2:
I don't think it's correct to characterize cap and trade as a shield. Today, that tax does not exist. When it does it will raise the price of domestic products. Other nations who do not share our values and don't have the same cost burden, should be taxed at the border to allow us to exert our will and our values as a customer.

Fully agree.

Their slant/lie was to show that the poorest quintile would suffer the greatest pain from cap and trade. Were the revenues used equally among all citizens this would be true but of course it's not. The bottom quintile will be subsidized to make this revenue neutral. As I pointed out in another post, the middle class will bear the brunt of this legislation. I think they have the fewest lobbyists.

This is the main reason why I don't like Cap and Trade and would prefer a direct tax on carbon emissions. The politics of getting a workable cap and trade program may not be possible. I see 3 main problems with cap & trade.

1) How do you determine the initial cap?
2) At what rate will the cap be reduced?
3) How will the initial permits be distributed and how will new permits come into existence?

If the lobbyists can get the initial cap set too high, or the rate of reduction too low, or too many permits with exemptions for new outlets, the whole program falls apart and our children end up cursing our corruption.

Direct carbon tax has it's problems but it's far easier for a public, that's more concerned with the death of moonwalking than the risk of death to their civilization, to understand.