Once upon a time, cap-and-trade was the Republican Party's market-friendly solution to environmental pollution, while conversely the idea of letting corporations pay for the right to pollute disgusted environmental groups. Ronald Reagan used cap to phase out lead from gasoline in the 1980s. George H.W. Bush used it to reduce SO2 emissions from power plants in the 1990s. John McCain sponsored US legislative proposals to use cap-and-trade to address emissions of carbon dioxide and other greenhouse gases responsible for global warming. Times have changed and now, I remember hearing in recent years from conservatives how cap-and-trade will destroy the economy, drive California into recession (because of its decision to "go-it-alone" and implement its own cap-and-trade program), drive unemployment into astronomical numbers, and leave California a broken-wreck unable to compete with other states.
So now that California's cap-and-trade program has been in effect for a year, I wanted to get a sense of how it's actually working in practice. What's happened in California in the last year now that it's "struggling" under the burden of cap-and-trade?
So far, it actually seems to be working extraordinarily well. Forbes published an article laying out Four Reasons California Cap And Trade Had An Extraordinary First Year. According to the article, the program has been well run and successful in conducting it's auction.
It's had a marginal (if any) impact on California's economy, which continues to recover. I was a little worried about this from my uneducated viewpoint. I mean if you listened to the pundits (John & Ken, Rush Limbaugh, etc.), we were all going to be unemployed and homeless if cap-and-trade went into effect in California. I wish I was exaggerating. But that's exactly how strong conservatives sounded when they spoke about cap-and-trade.
Moreover, despite the argument that any action by California will be futile if they try to "go it alone," we're seeing California extending its reach beyond its own borders. It's entered into a series of partnerships with Quebec, Oregon, Washington state and British Columbia. It's also entered into memorandums of Understanding with China and Australia to guide collaboration in addressing climate change. In other words, it's a start and a successful start to addressing the industrial pollution causing climate change.
Matthew Carr of Bloomberg News recently spoke about the importance of America as a whole entering into international accords for an expanded carbon market. This was in his article, American Carbon Market Seen as Winner With China Accord. According to Mr. Carr, "the U.S. will want to enlarge its carbon market and link it to China’s during the next 15 years, following in the EU’s footsteps."
I applaud President Obama on his recent executive actions with respect to immigration. While executive action isn't preferable to true legislative change through principled congressional action, that wasn't happening. What I would love to see now is President addressing climate change through executive action and regulations so that the United States can continue to lead the way and be an example for other countries in meeting the internationally agreed goal to cut emissions fast enough to keep temperatures from rising more than 2 degrees Celsius (3.6 Fahrenheit) in order to avoid the most severe and widespread implications of climate change.
I know I've said nothing particularly enlightening here. It's more a reminder to myself that while many important issues remain to be addressed politically in our mixed up world, climate change, left unchecked, will dwarf in terms of human pain and suffering all of those issues.