Plano Texas Politics

July 1, 2009

My Own Argument Against Cap and Trade

I’m sure someone has already come up with this, but this is one argument against cap and trade that I call my own.

While I would deny that we are producing to much carbon, I will also say that, going under the assumption we do need to reduce carbon, cap and trade will not be an effective way to limit it.  Business costs rise.    What do businesses do?   They relocate.  Let’s suppose that businesses that represent 10 percent of American carbon emissions move.  This seems pretty reasonable because the businesses with the most carbon emissions will be the first to go.  Suppose some of them go to China, and when they research environmental protection laws in china, they find that if there are any, they don’t come close to the American standards.  Begin to produce more carbon than they produced before.  If they increase carbon output by only one fifth, or produce 12% of America’s 2008 carbon output, and companies still in America produce 80% (80% is less than what I heard America should be producing in a decade under cap and trade) of America’s 2008 carbon output, then we have arrived at a whopping 8% reduction in carbon output.  And that’s before adding other ways to get around the law, or breaking the law, into my calculations.  All that at a tremendous cost: jobs lost, prices up, more real pollutants as companies move to less regulated countries, and probably effects on businesses similar to that of Europe’s cap and trade system.  (see this article paragraphs 7-10.  the rest is good too)

Finally, if you think the cap could just be lower to make it effective, (and I think it supposed to lower much further, just don’t quote me there) then more companies would relocate until carbon production was somewhat affordable.  That’s the way markets work.  If man is responsible for global warming, then, well, I’m afraid that’s just too bad if cap and trade is the best we can do. 

–Samuel Peck