Let's Make a Deal: Automakers reportedly reach agreement with lawmakers on carbon cap legislation
Now that the U.S. has officially concluded that greenhouse gasses are harmful to human health, it's time to do something about them. One major hurdle standing in the way of the U.S. implementing carbon cap and trade legislation appears to have been cleared as both the domestic automakers and Michigan's legislature have lifted their opposition and now support for the bill. Why? The Detroit News reports that an agreement has been reached that could see up to $15 billion paid out to the Detroit-based automakers starting in 2012. Yeah, that would do it.
In a so-called cap and trade plan, the federal government would set a limit on the total amount of carbon emissions the U.S. as a whole can produce. The government would then divvy up that figure by issuing permits to various industries. A company that wants or needs to emit more carbon dioxide can either purchase credits at auction or pay fines for surpassing its assigned limit. Under the proposed deal, automakers will receive 3 percent of the revenue generated from both auctions for carbon emissions permits and fines paid by corporations for violating carbon limits. That revenue would drop to 1 percent in 2017.
John Dingell (D-MI) had this to say in a written statement:
"This is a significant achievement for the automotive industry and its workers, as the bill will help fund research, development, implementation and deployment of new, low-carbon technologies and upgrading manufacturing facilities to provide the next generation of green vehicles right here in the United States."The deal with automakers is just one of several agreements that House Democrats are making to appease various key state representatives and industry heads that may have otherwise opposed the bill. In its latest form, the bill would cap greenhouse gas emissions in 2020 at 17 percent below 2005 levels.
[Source: Detroit News | Image: Clinton Steeds]
Reader Comments (Page 1 of 1)
Throwback 1:04PM (5/14/2009)
This bill is doomed to failure. How many waivers do you think will be given out? First autos, then coal plants, famers, whose next? What industries will be left to "buy" these credits. Those that are left will simply pass the cost for polluting on to the end user. Guess who that is?
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GoodCheer 2:02PM (5/14/2009)
"Those that are left will simply pass the cost for polluting on to the end user."
But that's the point, isn't it. Shouldn't we pay for the cost of pollution in the products we consume?
And furthermore, the coal generators will need to charge a premium to buy allowances while wind, nuke and hydro (and solar) will not, so the later will see a competitive advantage that reflects the real environmental damage avoidance they provide.
Scorch 1:31PM (5/14/2009)
The very idea of giving automakers any more money is depressing. It is very unlikely that the government will ever be repaid on the "loans" they have been giving them already, why must we keep funneling more money from profitable businesses to money pits?
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Lou Grinzo 1:37PM (5/14/2009)
This should surprise no one. The get everyone on board with this large a public policy shift, there will have to be some concessions. And notice how the automaker payouts decline over time, as they should.
This is sausage making on a grand scale. It ain't pretty, but it's a necessary step to achieve the overall goal.
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Tim 2:51PM (5/14/2009)
I owe, I owe it’s off to work (to pay taxes) I go…
Meanwhile, the Unfunded Mandates and Federal Debt now exceeds $57 Trillion Dollars.
http://www.one-simple-idea.com/main/mod/forum/discuss.php?d=12
To put that in perspective:
1 year is 31,536,000 seconds. So it would take 31,709.79 years to count to 1 trillion.
By the time you guys finish counting we won't even be the same species. Now where did I put that damn fiddle?
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MikeInNC 4:37PM (5/14/2009)
They can call it anything they want but it's a new tax and it will hit the working poor the hardest.
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Dfresh 10:03PM (5/14/2009)
Pollution hits the working poor the hardest.
floorman56 10:33AM (5/15/2009)
Carbon's Power Brokers
By George F. Will
Sunday, June 1, 2008; B07
An unprecedentedly radical government grab for control of the American economy will be debated this week when the Senate considers saving the planet by means of a cap-and-trade system to ration carbon emissions. The plan is co-authored (with John Warner) by Joe Lieberman, an ardent supporter of John McCain, who supports Lieberman's legislation and recently spoke about "the central facts of rising temperatures, rising waters and all the endless troubles that global warming will bring."
Speaking of endless troubles, "cap-and-trade" comes cloaked in reassuring rhetoric about the government merely creating a market, but government actually would create a scarcity so that government could sell what it had made scarce. The Wall Street Journal underestimates cap-and-trade's perniciousness when it says the scheme would create a new right ("allowances") to produce carbon dioxide and would put a price on the right. Actually, because freedom is the silence of the law, that right has always existed in the absence of prohibitions. With cap-and-trade, government would create a right for itself-- an extraordinarily lucrative right to ration Americans' exercise of their traditional rights.
Businesses with unused emission allowances could sell their surpluses to businesses that exceed their allowances. The more expensive and constraining the allowances, the more money government would gain.
If carbon emissions are the planetary menace that the political class suddenly says they are, why not a straightforward tax on fossil fuels based on each fuel's carbon content? This would have none of the enormous administrative costs of the baroque cap-and-trade regime. And a carbon tax would avoid the uncertainties inseparable from cap-and-trade's government allocation of emission permits sector by sector, industry by industry. So a carbon tax would be a clear and candid incentive to adopt energy-saving and carbon-minimizing technologies. That is the problem.
A carbon tax would be too clear and candid for political comfort. It would clearly be what cap-and-trade deviously is, a tax, but one with a known cost. Therefore, taxpayers would demand a commensurate reduction of other taxes. Cap-and-trade -- government auctioning permits for businesses to continue to do business -- is a huge tax hidden in a bureaucratic labyrinth of opaque permit transactions.
The proper price of permits for carbon emissions should reflect the future warming costs of current emissions. That is bound to be a guess based on computer models built on guesses. Lieberman guesses that the market value of all permits would be "about $7 trillion by 2050." Will that staggering sum pay for a $7 trillion reduction of other taxes? Not exactly.
It would go to a Climate Change Credit Corporation, which Lieberman calls "a private-public entity" that, operating outside the budget process, would invest "in many things." This would be industrial policy, a.k.a. socialism, on a grand scale -- government picking winners and losers, all of whom will have powerful incentives to invest in lobbyists to influence government's thousands of new wealth-allocating decisions.
Lieberman's legislation also would create a Carbon Market Efficiency Board empowered to "provide allowances and alter demands" in response to "an impact that is much more onerous" than expected. And Lieberman says that if a foreign company selling a product in America "enjoys a price advantage over an American competitor" because the American firm has had to comply with the cap-and-trade regime, "we will impose a fee" on the foreign company "to equalize the price." Protectionism-masquerading-as-environmentalism will thicken the unsavory entanglement of commercial life and political life.
McCain, who supports Lieberman's unprecedented expansion of government's regulatory reach, is the scourge of all lobbyists (other than those employed by his campaign). But cap-and-trade would be a bonanza for K Street, the lobbyists' habitat, because it would vastly deepen and broaden the upside benefits and downside risks that the government's choices mean for businesses.
McCain, the political hygienist, is eager to reduce the amount of money in politics. But cap-and-trade, by hugely increasing the amount of politics in the allocation of money, would guarantee a surge of money into politics.
Regarding McCain's "central facts," the U.N.'s World Meteorological Organization, which helped establish the Intergovernmental Panel on Climate Change -- co-winner, with Al Gore, of the Nobel Peace Prize -- says global temperatures have not risen in a decade. So Congress might be arriving late at the save-the-planet party. Better late than never? No. When government, ever eager to expand its grip on the governed and their wealth, manufactures hysteria as an excuse for doing so, then: better never.
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stas peterson 2:59PM (5/19/2009)
As the great AGW and Carbon hoax loses the last vestiges of scientific reality, the Tax Raiseers are desperate toinstall their revenue raising new taxes.
Fire every one of them who votes for this boondoggle that failed in Europe not once, but twice.
Atmospheric Carbon will come down automaiticially as we switch to EVs, and the cooling Oceans shift to absorbing instead of outgassing CO2.
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GoodCheer 6:44PM (5/19/2009)
"Atmospheric Carbon will come down automaiticially as (...) the cooling Oceans shift to absorbing instead of outgassing CO2."
I'm sure I've pointed out to you before now that this fact is absolutely wrong.
The oceans are the single largest carbon sink on the planet, larger than all terrestrial life. The consequences of this CO2 sink is ocean acidification, which may prove disastrous for commercial fisheries, upon which about 15% of the world's population depend for food.
stas peterson 2:59PM (6/01/2009)
if you had a scienitific brain cell in your your body you would determine very quickly that that every mollecule of the atmosphere is equaled by the first couple of meters or so of seawater. That only leaves the couple of miles or more of ocean depths to dilute the entire atmsophere into irrelevancy, never mind trace gases that are measured in ppm.
To say the atmospheric contents of anything could influence the oceans is like saying the little boy on the beach with his plastic bucket and shovel could actually empty the ocean into his little sand castle's moat.
Your brain power is seriously lacking. Please go back to school and learn someting other than loon propaganda, son.