Cap and Trade Proponents Would Be Wise to Explain What It Is

A big part of the Waxman-Markey energy bill that passed the House Energy and Commerce Committee yesterday is about limiting carbon dioxide emissions and their contribution to global warming.
There are still those who argue passionately that global warming is an unproven theory and that spending trillions in an effort to keep the planet cool is a foolish waste of money. The weight of scientific opinion, however, seems to come down on the other side of the argument. Even big energy companies are now routinely delivering the message that the scientific debate about global warming is over and that it is time to talk about solutions.
One solution currently popular with business is the so-called "cap and trade" system. Under cap and trade, the total amount of CO2 that could be released into the atmosphere would be capped, and companies able to reduce their emissions immediately could sell their "pollution credits" to companies that need more time to comply. Over time, market forces would steadily drive down the amount of CO2 released into the atmosphere.
A seemingly simpler solution - and one that many businesses, especially most energy companies, hope is never adopted - is a "carbon tax." Supporters say it would be a lot less complicated than cap and trade and that a stiff tax on greenhouse gas emissions is all the incentive that big polluters really need to clean up their act.
As in most high stakes policy debates, how the terms are defined is likely to determine the outcome. And while there may be a lot of sound arguments against a carbon tax, it is easy for non-experts to understand. Pollute the air. Pay a tax. Simple as that.
Meanwhile, cap and trade sounds to the average American like little more than a clever shell game. Unfortunately, it is probably too late to change the name. But cap and trade advocates need to come up with a way to describe the system that makes sense to non-experts. They need to make clear, in the simplest terms possible, that under cap and trade market forces will steadily increase the cost of carbon emissions and total CO2 emissions will be steadily pushed down. No new taxes required.
Telling the cap and trade story in simple, positive terms is the best way to make sure that the deceptively simple carbon tax does not emerge as a viable alternative - one that would be bad news for business, environmental advocates, and just about anyone else who doesn't think the earth is getting cooler.
David Bartlett is a Senior Vice President at Levick Strategic Communications and a contributing author to Bulletproof Blog.
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