This is good news, I think. The House Energy and Commerce Committee just issued
a white
paper on carbon controls, which starts off by saying unambiguously that
"The United States should reduce its greenhouse gas emissions by between
60 and 80 percent by 2050 to contribute to global efforts to address climate
change". Now 2050 is a long way off, and it would be nice to have some
nearer-term targets, but it seems as though the US legislature, which has historically
not been very amenable to such thinking (remember Kyoto?) is finally coming
around to the side of the angels.
The white paper seems smart to me. It says, reasonably enough, that a cap-and-trade
scheme will be front-and-center in achieving carbon emissions, but does add
that "tax policy could play an important role" as well in reducing
greenhouse gas emissions.
Peter Dorman complains
that the paper "speaks vaguely of “distributing” permits without
even raising the possibility that they should be auctioned" – but
my reading is slightly different, that the paper is deliberately fudging the
issue and leaving the door to an auction mechanism pretty wide open. In any
case, even if permits aren’t auctioned in the first year of operation, there’s
no reason why a future legislature can’t slowly reduce the amount of permitts
allocated and increase the number of permits auctioned.
The whole paper seems sensible to me, and aware of the practical difficulties
of a cap-and-trade system as well as the areas where a carbon tax might be able
to fill in some of the gaps. I look forward to the next occupant of the White
House actually enacting this kind of thinking.