Understanding the potentials of the law of unintended consequences as we examine what might result from COP15 and/or the adoption of ‘Cap & Trade’ is as important as understanding the science of climate change and the implications of human caused global warming. Examining the complex mechanisms of ‘Cap & Trade’ vs. a simple ‘Direct Progressive Tax’ on CO2 emissions reveals a fatal flaw in the understanding of the advantages of Cap & Trade. In reality, there are no meaningful advantages.
Jim Hansen: ‘Storms of My Grandchildren
COP15 Problems & Potentials
The problems and potentials include: if ‘Cap & Trade’ is adopted the delays caused by a system that is designed around loopholes will be less effective than a more straight forward ‘Direct Progressive Tax’.
A mathematical analysis by the IPCC community and others presented by Bob Corel (Arctic Climate Impact Assessment) in the spring of 2009 of the proposals for carbon output reduction submitted by world governments for the United Nations Copenhagen Meeting (COP15) in December of 2009 yielded an emission result of CO2 around 700ppm of atmospheric carbon by the year 2100 (based on current consumption). That would result in a warming approximated at 4.5C (8.1F) of increase in the Global Mean Temperature.
Business as usual would result in an atmospheric concentration of more than 900ppm. In such a scenario the implications are hard to imagine as illustrated in the OSS synthesis report including: CSIS, MIT and the spring 2009 Copenhagen Congress.
It’s a given that:
- as we approach 2C (3.6F) of warming economic and resource capacity will be severely strained.
- we are on course to exceed 2C (3.6F) of warming.
- ‘Cap & Trade’ in so convoluted that it would be better to not adopt it at all.
- ‘Direct Progressive Tax’ provides the fastest simplest method to achieve meaningful reductions of CO2 industrial emissions.
The Fatal Flaw
Cap & Trade is convoluted with so many loopholes and evasions that it’s ability to be affective on a meaningful timescale to avoid significant temperature rise is not only in question, it may be impossible. In this case timescale is everything. If emissions are not reduced in time, larger temperature increases becomes unavoidable. If we pass certain tipping points, our ability becomes increasingly impeded to economically manage the challenges ahead.
“What is planned for Copenhagen is a selling of Indulgences, as in the Middle Ages when the Catholic Church sold forgiveness of sins.”
What Dr. Corel’s examination (referenced above) does not address is the potential and ability of the worlds corporations to avoid, mislead, misdirect and thereby evade meaningful reductions in CO2 emissions in a meaningful and timely manner. Anyone that understands the potential of the above emission numbers can see that in any case, the result is an unacceptable level of disaster for the global economy and the human race. The global economy includes monetary and livings systems. The environmental conditions in which our civilization developed was at or around thermal equilibrium of our recent interglacial peak 12,000 years ago. The current atmospheric forcing far exceeds thermal equilibrium and will result in systemic shifts that will impact infrastructure and resource capacity. The emission reduction proposals for COP15 appear to be significant but to little to late is a serious risk. Dr. James Hansen has been trying to raise awareness of the weaknesses of the Cap & Trade proposal for years now. The momentum of Cap & Trade may be preventing more meaningful proposals from gaining ground.
Dr. Jim Hansen, considered the worlds leading climatologist published an op-ed the New York Times (Dec. 7th, 2009) on “the deadly cap-and-trade fiasco” that corporations and “governments are attempting to foist on the world to the detriment of our children and grandchildren”.
Dr. James Hansen:
“Their scheme, hatched in collaboration with Wall Street big banks, is a reprise of the Kyoto Protocol. Global emissions after Kyoto actually increased more rapidly (in real terms, percentage terms, and exponential rate of growth) than before. Even those few countries that reduced their emissions (and few did after “offsets” are eliminated) did so by exporting their emissions (and jobs) to developing countries (to make products exported to the developed countries).”
Dr. Hansen has written a new book called ‘Storms of My Grandchildren’. where he illustrates the nature of the problem of ‘Cap & Trade’ v. the more favorable ‘Direct Progressive Tax’.
“What is planned for Copenhagen is a selling of Indulgences, as in the Middle Ages when the Catholic Church sold forgiveness of sins. The Bishops were very happy (lots of moulah) and the sinners were happy (they could still go to heaven). The developed country sinners in Copenhagen will be paying moulah via “offsets” (many imaginary or unverifiable) and “adaptation” funds and the developing countries will be looking to collect as many billions as possible. Can’t blame them for that, but it is plain as day that the global emissions are not going to take the rapid downward track that the science demands.
Cap & Dividend/Direct Progressive Tax
‘Direct Progressive Tax’ clearly appears to be the best method to achieve rapid, meaningful CO2 emission reduction. That means a direct progressive tax on fossil fuels at the point of origin or point of import.
Two problems are still in the way and there is one reasonable solution for this.
- Inadequate understanding of the science and ramificaitons of climate change among the public and policy makers.
- The complexity of the science and scope of the problem.
The solution is a coordinated strategic communications plan.
‘Cap & Trade’ v. ‘Direct Progressive Tax’
The main risk seems to be visible in two points:
- ‘Direct Progressive Tax’ can provide meaningful CO2 emission reduction is the simplest form. This reduces the ability to delay emission reduction.
- ‘Cap & Trade’, if passed would be a two edge sword. It would show that awareness is increasing but would pass a measure that would be ineffective in reducing emission in a meaningful manner. The adoption of ‘Cap & Trade’ could therefore delay the passage of the more meaningful and effective ‘Direct Progressive Tax’.
The adoption of Cap & Trade may likely and significantly delay more meaningful and effective policy. The Cap & Trade method has significant support in the corporate arena and discussions of Direct Progressive Tax have remained largely out of the discussion. What is required is increased public and policy maker understanding of the factors and consequences of decisions relating to adoption of Cap & Trade in lieu of a clear and simple policy ‘Direct Progressive Tax’.
While the effort for Cap & Trade shows progress in awareness it may or likely will delay needed emission reduction and needed policy action that would more rapidly decrease CO2 emissions. The end result is greater economic stress. That translates to increased difficulty in coping with the challenge of our time, that of ‘human caused global warming’ as it pertains to existing infrastructure and resource capacity to support the human race.
|Home page for ‘Storms of My Grandchildren’ with links to purchase outlets for the book. Dr. Hansen is considered one of the worlds leading climatologists with an acute understanding of climate dynamics and expected impacts. (Click here)|