US House May Pass "Cap & Trade" Bill 874
jamie found this roundup on the status of the Waxman-Markey climate change bill, which is about to be voted on by the US House of Representatives. (The article notes that if the majority Democrats can't see the 218 votes needed for passage, they will probably put off the vote.) The AP has put together a FAQ that says, "[The bill, if passed,] fundamentally will change how we use, produce and consume energy, ending the country's love affair with big gas-guzzling cars and its insatiable appetite for cheap electricity. This bill will put smaller, more efficient cars on the road, swap smokestacks for windmills and solar panels, and transform the appliances you can buy for your home." The odds-makers are giving the bill a marginal chance of passing in the House, with tougher going expected in the Senate.
So they want me to drive a hybrid. (Score:2, Interesting)
The good part (Score:2, Interesting)
Peak Oil necessitates energy conservation (Score:2, Interesting)
So far all I've read in this thread are posters decrying this as a massive tax grab. That's a limited perspective, to say the least.
Yeah, mod me down as a paranoid troll, but we're already passed Peak Oil.
For those who don't understand what Peak Oil is:
http://en.wikipedia.org/wiki/Peak_oil [wikipedia.org]
Basically, it's what is IMO a fact, that oil production/extraction will peak at a certain level (X number of barrels per day) and then begin an inexorable decline. Whether or not this output is replaced by alternative energy remains to be seen.
Nonetheless, most people don't understand how much energy we get from oil. Oil is the densest, easiest to transport, and most reliable energy source available. Once it's gone, alternatives will fall short of those standards:
http://www.theoildrum.com/node/3084 [theoildrum.com]
The total oil production volume amounted to a cubic mile (not a type) of oil per year. To equal this, it would take 104 coal fired plants running for 50 years, 52 nuclear plants running for 50 years, 32, 800 wind turbines running for 50 years.... you get the picture.
So when oil production starts winding down, we'll be hard-pressed to replace that output. The only way we can aspire to coming close to equaling that output is through energy consumption and more efficient use of energy. So far, the government's record on this is pathetic, and the private sector has had, at best, limited results.
Re:Cap & Trade = Energy Rationing (Score:2, Interesting)
1. New products will need to be designed that use their energy more efficiently. Which produces jobs.
2. Industries will have to buy new products to increase their efficiency to stay within limits.
3. People who have jobs from 1 will be spending money again.
#2 will likely increase the amount consumers pay for some goods, but as long as more consumers are working, it should work out. The economy is a cycle, and it just matters what that cycle is producing. It works to raise quality of life. This time, though, QOL isn't about products (TVs, Cars, etc) its about our living environment.
Comment removed (Score:3, Interesting)
Re:Cap & Trade = Energy Rationing (Score:5, Interesting)
You know, I can't buy the old school hydrochlorofluorocarbon [wikipedia.org] to use as a refrigerant in my new car. The new stuff doesn't work as well (it's close) but it's a lot better for the environment. Small things like this can be important to entities like the EPA.
R-134a is actually not very efficient compared to R-11/R-12, and overall it may be *worse* for the environment. Don't confuse "doing something" with "doing the right thing" -- banning CFCs and HCFCs in cooling systems was not necessarily the best choice. Among other things, cooling systems were not a huge contributer to atmospheric CFCs (particularly modern, low-pressure chillers which cannot leak), and the ozone hole is actually not nearly as bad as we imagined when we started banning things. But now, 25 year later, greenhouse gasses are a much larger concern, and you know what the CFC/HCFC ban did without question -- raise energy usage in cooling systems by lowering efficiency.
You see, in our rush to do something to "save the environment" (i.e. generate political capital) we just rushed out and banned the first thing we could find that had a potential negative environmental impact and didn't have a strong lobby to protect it. We could have done something useful like reducing sulphur levels in diesel (we put that off for another 20 years), but instead we did something that is, at best, a wash for the environment, and quite possibly detrimental. Can we please not make the same mistake twice in a row?
Re:Creating Chaos for Profit (Score:3, Interesting)
Who exactly is benefitting here?
Government owning the rights to pollute doesn't mean they stand to benefit the most.
The Investment Banking cohorts JPMorgan Chase and Goldman Sachs are the **huge** winners. How?
1. They take a cut of every transaction. The more valuable the credits, the more they earn. So the value of the business is guaranteed to increase every year.
2. They arbitrage the market. There is a spread that develops between an asking and a selling price in any given market. you can place bets on the spread among other neat ways to make money.
3. They game the market. Recent economic history is full of deregulated energy schemes that had huge artificial spreads between demand, supply and price.
Rolling Stone has a nice article on Goldman Sachs absolutely worth your time. If you read it, please realize it is exactly that bad. http://d.scribd.com/ScribdViewer.swf?document_id=16763183&access_key=key-aq99m8654zlwmm5muht&page=1&version=1&viewMode= [scribd.com]
It essentially puts extra costs on industry that uses polluting fuels,
Right. The idea is to have the worst polluters 'taxed.' That tax defrays the public health costs of pollution. For example, if there were 10,000 less instances of cancer that kills people, there would be meaningful savings in medical expenditures. Now, that is not to say this scheme will not blow up in a mushroom cloud of corruption. Because it is. GS and JPM are behind it 100%. That's a clue that it's bad to the core.
If I followed the logic as laid out in most of the replies, then most regulations with a public health savings angle should be abolished. We should go back to the 1940's and have cars that kill people instead of absorbing impact, cigarettes for everyone and smoked everywhere just to name two.
How about expressing your dissatisfaction by getting involved in the political process instead?
Re:Peak Oil necessitates energy conservation (Score:3, Interesting)
Re:No real impact (Score:3, Interesting)
This is about forcing the poor and lower-middle into shifting, they'll be the ones who will have no alternative, but fortunately they make up most of the population and seldom contribute to political campaigns. Then again, when someone making 24K a year can't get a loan to get a new car, well good luck with that. I guess they had better make sure they live in a city and rely on public transportation.
The part that perplexes me is why there isn't a tax credit for shippers? They need cheap fuel to transport goods, otherwise this whole world where I can go down to Wally World for a $3 pack of beer is over, literally overnight, not accounting for inevitable food shortages. Guess healthcare really will get better with all of these people walking everywhere and living off of greens they grew in their backyard.
Also, and this is by far the most galling part, why tax electricity? The area I live in is powered by a combination of nuclear and hydro-electric power, so I'll be nothing more than easy income for the Fed, unless I have a windmill in my backyard and then I'll get taxed by my city for noise pollution. I'm guessing this will be written off as a hand-of-one-is-the-hand-of-all type thing since power is shared across the grid.
Re:The biggest tax in US history (Score:1, Interesting)
Between this and the health care bill fiasco, I have to wonder whether Obama hates being President and wants to cut his own balls off in protest.
Cap and trade is a SCAM. That's why Al Gore has been pushing it so hard, because he wants his cut of the market. A simple question: why is the current administration hellbent on taking the profit motive out of healthcare, but wants in turn to add it to what amounts to energy taxation? Why would you not directly tax carbon emissions directly if you were REALLY concerned about the environment? And worse still, they could have taken the money from the carbon tax and USED it to implement single payer healthcare.
Instead, we get a bunch of wishy washy idiots from big cities trying to dictate to people who actually PRODUCE things, and a President who has stated that his health care plan is good enough for everyone else, just not good enough for his own daughters.
I knew I'd see the day when the Democrats were even nuttier than the Republicans, but I didn't expect it to happen so soon.
Re:Cap & Trade = Energy Rationing (Score:2, Interesting)
What complete bullshit. Interestingly enough the polluters said essentially the same tired bullshit when the Cap & Trade system for Sulfur Dioxide was setup. The economy did not collapse. The industry did not die. The United States of America did not descend into despair and anarchy.
So forgive me, when I do fall for your tired, whiny ass bullshit.
Re:Cap & Trade = Energy Rationing (Score:4, Interesting)
The tax rate's gone up, but if consumption has gone down, what is the real cost to average family? Do you really trust a group to be unbiased or accurate whose mission statement starts: "The TaxPayers' Alliance is Britain's independent grassroots campaign for lower taxes."
Public Good? Public Grant. (Score:4, Interesting)
First: the fundamental problem: We live in a global economy. This will absolutely increase the cost of domestically produced carbon-intensive goods relative to foreign produced carbon intensive goods from countries that are not affected by the program (unless we implement an import tariff to match the internal effective tax).
That doesn't mean it's a bad idea, but it is a fact which must be weighed when considering the program.
I still like the idea, though I would want the allotment (see below) to be high enough that it would be more of a gentle nudge than a baseball bat.
That's the problem, and my take, on the general concept. As for this specific embodiment, it is going to be a gigantic corruption engine, passing money from the biggest polluters to the most unscrupulous politicians, regulators, and lobbyists. But it can be solved, if you like the gentle nudge idea (or even if you like the baseball bat idea).
The first step in a cap-and-trade program sets a limit on the amount of gases that can be released into the atmosphere. That is the cap. Companies with facilities that are covered by the cap will then receive permits for their share of the pollution, an annual pollution allowance. This bill initially would give the bulk of the permits away for free to help ease costs, but they still would have value because there would be a limited supply.
So, what portion of those initial free credits do I get? Who decides how much each company gets? Is it based on industry? Revenue? Profit? Market cap? Campaign contributions?
My guess is that this is going to be another gigantic paean to incumbents and the big shaft for startups.
Here's my proposal:
Every U.S. voting citizen gets an equal share, to do with as they please, apportioned annually. Corps don't get any -- they have to buy them from citizens. Give yours to your employer, sell it, sit on it, whatever. After all, this is a public good that is up for sale, right? What possible fair system could be established for the government picking which corps to give them to?
To keep the prices reasonable at first, start with massive over-subscription. Allot 1,000,000x what we're producing now. That should solve the problems of the initial market not existing. Then just lower the rate by 10x per year until we get to the desired level. But don't just hand these things out to the biggest incumbents and screw new business.
Note that this approach would achieve exactly the objective:
People who want to "be green" can sit on their credits, and forgo the money.
People who consume less carbon-intensive products would pay less of the "passed on" cost from companies that have to buy lots of credits.
People who are willing to pay for carbon intensive goods can, and the glorious free market hands that money to people who make sacrifices to reduce carbon consumption.
Adjusting the annual allotment naturally adjusts the price.
No single person, whether CEO, laborer, politician, lobbyist, or EPA regulator, gets any disproportionate share of the public good.
Companies that cut carbon emissions can put their products on the market at a lower price.
The solution as proposed only achieves the last piece, and that only in an extraordinarily corruption-sensitive way.
Limitless energy (Score:3, Interesting)
Perhaps we can find a way to harness the power of Americans whining about their as-yet-imaginary future energy bills? That would give us a wealth of power for decades.
Seriously guys, nad up. You all sound like Neville Chamberlain whining about how difficult and expensive fighting the Germans is going to be, and how they'll probably go away by themselves if we just continue to ignore them for another couple of years.
Existing laws against nuclear, wind, and solar (Score:3, Interesting)
Clearly you don't have a legal mind. We're not talking about a cap on real emissions here, only on taxable emissions.
The emissions used in building a wind or solar plant or in upgrading the grid are taxable.
Pollute all you want while putting up a HVDC backbone; as long as you do it from sources that aren't covered by this legislation, the planet is saved!
What I'm trying to get at is that wind, solar, nuclear, and the like are ruled out by existing legislation. Nuclear, for instance, runs up against homeland security. Wind and solar run up against zoning (aka "NIMBY") laws.
Re:Cap & Trade = Energy Rationing (Score:3, Interesting)
And so he will not increase taxes. That he taxes corporations and they pass along costs to people doesn't make it a lie. It makes him a politician. The taxes on the people making less than $250,000 will not change. Period. But if those evil corporations don't cut energy use, and instead choose to charge people more for products, that's their fault.
Re:Cap & Trade = Energy Rationing (Score:3, Interesting)
The only economy that can afford to invest in the shiny new technology that (as it has been doing for decades) improves our air/water quality, dramatically improves efficiencies and productivity per person and per acre and per hour... is a thriving and growing one.
His son isn't drafted to die in an oil field halfway across the world?
Yes, we're seeing a lot of that, now. The draft is a real burden. We may need one, though, when huge new taxes rock the economy, and places like Mexico completely fall apart at the seams.
His wife doesn't die of lung cancer from air pollution?
Maybe she should stop smoking. That's a much bigger problem than the pollution that we've hugely reduced over the last few decades. Of course, you trolling well know that.
having to wear oxygen masks when they go outside 40 years from now?
Yes, because if we don't do anything hugely punishing to everyone in the economy, we'll suddenly all be driving 1964 Buick station wagons again, with leaded gas.
Re:Gas (Score:4, Interesting)
True. But people do have a choice in where they choose to live. and choosing to live a commute from work in a hot region has consequences. And when we as a society decide that individuals must PAY THE COST OF THEIR OWN CHOICES... as we would with appropriate energy costs that take into account external costs we have gotten used to being shielded from... then people will have to deal with those consequences.
it sucks for the first people who have to change... such as me, who stupidly bought a house a half hour from my office and can't sell it, so I must commute as I don't have time for 3 hours of biking a day, minimum... but hey, thems the breaks. We also had the benefit of stupidly cheap energy for a long time, which is more than anyone coming after us will be able to say.
This is an optional tax. We can use less energy. We may not be able to do it with 70 degree thermostats year round, 30 MPG cars if we're lucky, and without planning our trips to the store a little better, but it can be done. This removes our ability to ignore the consequence of our actions. Nothing more.
Re:Gas (Score:1, Interesting)
It has nothing to do with paying the cost of our own choices. It hurts people like me as well. My Car (Ford Focus, 2001) I already get 35mpg, and 41 Highway. I rent in a low-rent neighborhood. Why? Because I can't afford anything else. This past winter I had no heat. Can you guess why? The few nights it froze completely, I had a heater on, that was maybe 2-3 the entire season because it was just too damned cold not to. (Blankets and proper insulation helps, but sometimes its not enough) Its in the 90s now (I live in Sunnyvale, CA) and will get hotter in the forseeable future. Can't afford to cool off anything due to the high costs.
This is a tax on the poor. We will get hit the hardest. Elderly who cannot afford anything beyond what theyre doing already will be hurt the most, and they are the ones that need it the most.
So your answer will be, "Oh so move somewhere more affordable". Great idea! I just need to, Find a Job there, and find a place to live and.. Oh wait, both of those take money? Damn. Can't do it, don't have that Luxury.
Choice is, in most things in life, never a real choice. The Poor don't have the luxury of choice, choice takes money to pay for the failures of the wrong choices.
Behavior (Score:3, Interesting)
The price of gas has changed behavior. Britons rarely consider just driving across their country because of the expense. They don't consider having a 30 mile commute because of the expense. They don't consider buying a 6 liter engine because of the expense. Where I live, commuters drive 100 million miles a day just to go to work and back again. That's just fucking madness.
Communities in areas with realistic gas prices are built accordingly. America can choose to be inconvenienced today or be totally noncompetitive tomorrow if we don't make changes to oil usage. If you want to sentence your children to spending half of their money getting to and from work, that's a choice, but not a very smart one.