Thursday, September 24, 2009

Defeating Cap and Trade

Richard Lugar, one of the Republican senators being courted to pass the cap and trade, carbon emissions bill said that such a bill would likely not pass this year due to the ongoing Health Care debate. I tend to agree. I see this as both opportunity and danger. The opportunity is that the Tea Party movement can help build highly deserved disgust towards legislation that hands out exemptions like Halloween candy to the politically favored. The danger is that Green groups will get organized more quickly than our side and blunt the message about the horrible jobs impact of this bill.

I would like libertarians and conservatives to seriously re-think the merits of a carbon tax, when coupled with reductions in the income tax. With regards to global warming, it allows us to avoid a debate over whether global warming is
  1. Actually happening.
  2. Actually man made.
  3. Actually bad.
We can concede on these issues or just say it doesn't matter because even if all three were true, Cap and Trade would STILL BE BAD POLICY.

Second, by proposing to reduce income taxes to offset carbon taxes, it puts the Democrats in a tough spot. (I have also argued the benefits of a consumption tax vs income taxes.) We can make this argument, if global warming is the giant threat you say it is, why wouldn't you reduce income taxes as the price of saving the planet? Are you hypocritical? The countercharge that we are holding the planet hostage to tax cuts, is that we believe that national wealth needs to be preserved to combat the potential crisis.

Finally, Republicans need a serious plan to deal with the negative side affects of burning carbon, I think that just saying no to cap and trade will be insufficient. A carbon tax, because it is simple and predictable will have the lowest impact on the economy and be the least susceptible to log rolling.


  1. Excellent post. In addition to being simple and predictable, a carbon tax would also be more effective than cap-and-trade. For more information on a revenue-neutral carbon tax, see the Carbon Tax Center web site.

    Dan Rosenblum
    Carbon Tax Center

  2. We must focus on defeating the Waxman-Markey legislation. It spells disastrous consequences for our economy in the form of lost jobs and increased costs to the American taxpayer. Voice opposition to cap and trade at

  3. Dan,
    Thanks for the link. I really appreciate the concept of revenue neutrality. Your web site's full exposition of the issues surrounding such a tax is commendable.

    Agree with defeating Waxman-Markey. Don't know you, so I don't recommend my readers click your link. Sorry, but too many bad actors out there promoting malicious web sites.

    Regards, B-Daddy

  4. Carbon tax/ Scharbon tax, a tax is a tax. This pisses me off, especially coming from my Libertarian mentor.

    Ok...implement a debate on the tax first, then, have the debate on why it's used as an instrument subsequent to the debate...right? When there is no consensus on the cause of loss?

    Is that the thoughtful, rational, reflective reasoning we should expect from a Libertarian thinker?

    Shouldn't we be finding merit to the cause of loss before we jump into the solution (tax) of the problem?

    I think your priorities regarding the issue are skewed by your belief of anthropogenic global warming. Your rush to implement a debate re: the carbon tax, just to get a jump on the liberals is just as disingenuous as the cap and trade debate itself.

    Just because you believe there is anthropogenic cause of loss, does not make the debate of taxes worth its weight because YOU say so. You become just like them when you inspire a debate of taxes… prior to determination of the cause of loss

    I understand you want to take the debate out of the realm of government over-spending. I understand there is a free market solution to the alleged problem. But to concede the anthropogenic source prior to a REAL consensus is foolhardy.

    The same media driven hype has given rise to the Obama administration and questionable spending on stimulus. We had Bush signing off on bail-outs because of alleged financial institutional collapses. Now... I’m going to believe they know the consensus because they say so? You can believe, Bdaddy, do whatever you want, but understand this, consensus is an opinion or position reached by a group as a whole. There is not a consensus on man-made global warming, just as there was not consensus on the bailout.

    But rush, rush, rush, hurry, hurry,.... lets push through bailout,stimulus, health care.....before we have a real debate. WE cant wait, it's too important, IT'S A CRISIS! GOTTA MAKE A LAW! GOTTA THROW SOME MONEY AT IT, MAYBE ADD A SMALL SIN TAX OR TAX THOSE EVIL RICH.

    Just because the Republicans decided to sell out, didn't mean it was the right thing to do.

    Just because you believe it as a conservative Libertarian, along with the @$$whole liberal media doesn’t make it so. And just because you believe it when you don’t agree with 99% of the rest of the left agenda doesn’t qualify the debate as to consensus.

    Please give this some thought.

    Constant reader,

  5. 'Dawg, to B-Daddy's point, I believe that setting aside the global warming debate for a moment, B-Daddy is advocating a carbon tax as part of a larger effort to move away from income tax and towards a consumption tax as the primary tax revenue generator.

    Again, forget AGW for a minute... would you not feel more comfortable in being assessed a tax on stuff you are consuming rather than being taxed for your labors and initiative, in a progressive fashion, no less?

  6. Dean, thanks for responding on my behalf. Further, I am not trying to rush debate, in fact I want to slow debate and find a consensus we can all live with.

    If Republicans can stop Waxman-Markey, and having an alternate plan is part of the political effort, then Obama's EPA has threatened to go regulate carbon dioxide as a pollutant. I look forward to the Supreme Court debate on that. I don't think AGW is proved beyond reasonable doubt, I just think the preponderance of the evidence supports the theory. But that is not a high enough standard. A Supreme Court hearing would force the Goracle into the debate he fears.

    As a libertarian this tax does not violate my principles.
    1. It could reduce the income tax.
    2. It abides by a principle that top solve "the tragedy of the commons" use of the commons (in this case our atmosphere) must be paid for.
    3. It would help defeat "cap and trade" which is to environmental legislation what the stimulus bill is to thoughtful investment.
    4. It reduces the flow of income to tyrants.

    Ultimately some taxes have to be paid, it matters what form they take. A carbon tax is a much better tax than the income tax.

  7. I re-read your post and with your comments, I have a better understanding of your position.

    But I can't imagine a carbon tax replacing or in lieu of other taxes. It will be just another tax. That's not how Washington works.

  8. 'Dawg, fair enough, there is ample reason to fear that outcome. I fear it as well, which is why I make clear that an offset is needed. Dan's link to the Carbon Tax Center has a pretty good round up of the arguments.

  9. And one more thing. Cap and trade is a tax as well, so unless it is defeated we still get more taxes.