Comments on: Feds follow Ontario… http://www.cleanbreak.ca/2007/04/25/feds-follow-ontario/ Trends, happenings and innovations in the clean technology market Mon, 30 Jan 2012 14:28:54 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Anonymous http://www.cleanbreak.ca/2007/04/25/feds-follow-ontario/comment-page-1/#comment-1130 Anonymous Wed, 25 Apr 2007 18:37:00 +0000 http://www.cleanbreak.ca/2007/04/25/feds-follow-ontario/#comment-1130 I may be 'flogging a dead horse' with this comment, but I remain befuddled by the continued support by governments and especially some environmental organizations, for a Cap-and-Trade policy. I understand that many feel that a carbon tax would not be politically saleable, but there is a growing body of evidence out of Europe that strongly suggests that a cap-and-trade policy will fail. Moreover, I can imagine simpler mechanisms to implement a revenue neutral carbon tax than to implement all aspects of a cap-and-trade regime. If it were indeed revenue neutral, that would take most of the political sting out of a Carbon Tax. Those who suggest that Cap-and-Trade is superior to a carbon tax, in that it lets market forces drive solutions more efficiently, are simply blowing smoke. A Carbon Tax would raise the price of consuming and producing emissions to a level approaching their real costs to the economy, and would thus encourage a rapid market response in the desired direction. It would not take money out of the economy, as long as governments ensure that the tax is revenue neutral, and reduce, for example; personal income taxes. A Cap-and-Trade policy will necessitate a good deal of additional overhead in order to administer it, and will be vulnerable to manipulation and profiteering. The only definite outcome is that we will have introduced another type of financial market, and made more financial intermediaries rich in the process. I may be ‘flogging a dead horse’ with this comment, but I remain befuddled by the continued support by governments and especially some environmental organizations, for a Cap-and-Trade policy. I understand that many feel that a carbon tax would not be politically saleable, but there is a growing body of evidence out of Europe that strongly suggests that a cap-and-trade policy will fail. Moreover, I can imagine simpler mechanisms to implement a revenue neutral carbon tax than to implement all aspects of a cap-and-trade regime. If it were indeed revenue neutral, that would take most of the political sting out of a Carbon Tax.

Those who suggest that Cap-and-Trade is superior to a carbon tax, in that it lets market forces drive solutions more efficiently, are simply blowing smoke. A Carbon Tax would raise the price of consuming and producing emissions to a level approaching their real costs to the economy, and would thus encourage a rapid market response in the desired direction. It would not take money out of the economy, as long as governments ensure that the tax is revenue neutral, and reduce, for example; personal income taxes.

A Cap-and-Trade policy will necessitate a good deal of additional overhead in order to administer it, and will be vulnerable to manipulation and profiteering. The only definite outcome is that we will have introduced another type of financial market, and made more financial intermediaries rich in the process.

]]> By: Anonymous http://www.cleanbreak.ca/2007/04/25/feds-follow-ontario/comment-page-1/#comment-1129 Anonymous Wed, 25 Apr 2007 14:41:00 +0000 http://www.cleanbreak.ca/2007/04/25/feds-follow-ontario/#comment-1129 I'm not sure I question the motives <i>per se</i> of the Harper Government, so much as their motivation. I think that one can "believe in" the problems posed by climate change, and believe that the federal govt has at least a leadership role to play, while being ideologically conflicted enough not to be able to produce the clear leadership required. That being said, these announcements show leadership. I'm glad they've stopped talking about halting trains and grounding planes, and started moving forward on climate change. Even if we can't meet our Kyoto targets, we can at least have a clear and viable "Plan B". I’m not sure I question the motives per se of the Harper Government, so much as their motivation. I think that one can “believe in” the problems posed by climate change, and believe that the federal govt has at least a leadership role to play, while being ideologically conflicted enough not to be able to produce the clear leadership required.

That being said, these announcements show leadership. I’m glad they’ve stopped talking about halting trains and grounding planes, and started moving forward on climate change. Even if we can’t meet our Kyoto targets, we can at least have a clear and viable “Plan B”.

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