Cap and Trade question for Tupa

[Westside Steve]

So Toop, this is an honest question.

I might be way off base so I’ll ask you to set me straight.

I’m not stating my opinion as to whether or not this is a good idea, but if I’m fundamentally wrong about the basics of this plan tell me and I’ll admit I’m wrong. I easily could be.

 

Here’s what I think Cap and Trade boils down to giving the benefit of the doubt.

 

It’s a system (also called a "carbon tax) built on something called carbon credits. A corporation gets a certain amount of these that are spent by the use of fossil fuels , coal, oil, gas etc. in whatever business it may be.

 

Of course some will use less than others and those bigger consumers of energy can buy unused credits from companies that use less.

 

If that supply is low then a company may purchase more credits from (I’m assuming) a government agency. Both “greener” industries and the federal government might possibly profit from the sale 0f these “credits.”

 

Proponents hope that by making carbon based energy sources less financially attractive, that the “green” energy sources will be more competitive and therefore gain a bigger footprint in industry.

Further that increases in energy prices for the consumer will naturally create a stronger market for “earth friendly” products.

 

Proponents also hope that the US, by its example, might lead other emerging industrial countries (who are not now bound to that policy) in that direction.

 

The hope is to reduce the increases of greenhouse gases, and especially CO2, which will lessen those gases’ effect on the earth’s temperature.

 

Is this basic assessment of the plan as seen through its supporters generally accurate or not?

 

Thanks

 

WSS

[lambdo]

Well posed Q WSS,

 

I'll await Tupa's response before my input into this topic..But

 

There are some legitimate holes in this philosphy if it truly is designed like that.

[calfoxwc]

I'm hoping to see Tupa's response too.

 

I don't get it. If farmers have to pay high taxes to run their equipment, won't that raise food prices

 

through the roof, seriously through the roof? And... would some farmers simply have to quit farming for a

 

year or two, and sell their credits?

 

Yep. I really don't get it. Good, solid legit question, Steve.

[We need Tom Tupa]

One of the biggest remaining questions is how the program would be structured, so it's difficult to describe Obama's plan in any detail. The basic idea is that the government limits the amount of carbon that can be commercially emitted and then sells permits allowing companies to emit that carbon. The permits would then be tradable, allowing companies that "go green" the fastest to profit by selling their permits to companies that lag behind. Details are almost non-existent at this point because there are so many to be hammered out and so many competing views of what the plan should look like.

 

Proponents hope that by making carbon based energy sources less financially attractive, that the “green” energy sources will be more competitive and therefore gain a bigger footprint in industry.

Further that increases in energy prices for the consumer will naturally create a stronger market for “earth friendly” products.

 

Proponents also hope that the US, by its example, might lead other emerging industrial countries (who are not now bound to that policy) in that direction.

 

The hope is to reduce the increases of greenhouse gases, and especially CO2, which will lessen those gases’ effect on the earth’s temperature.

That's all about right, yeah.

 

[We need Tom Tupa]

I'm hoping to see Tupa's response too.

 

I don't get it. If farmers have to pay high taxes to run their equipment, won't that raise food prices

 

through the roof, seriously through the roof? And... would some farmers simply have to quit farming for a

 

year or two, and sell their credits?

 

Yep. I really don't get it. Good, solid legit question, Steve.

Individuals dont buy the credits. I wont need a permit to burn gas in my car.

 

Yes, new taxes raise prices. The point of the program is to raise the price of polluting, and therefore create an incentive to lower polluting. That's what taxes do, act as a disincentive for behavior.

 

(if this makes you wonder why we would want to increase taxes on work, you're on to something.)

[calfoxwc]

Well, I'm wondering if cap and trade goes commercial...

 

why wouldn't it apply to individuals? Established farms?

 

I don't know diddley about this. Crap. LOL

 

Thanks, Tupa !

[Mr. T]

Green Weenies dont care who has to pay, just as long a they get to implement their ideolgy upon all.

 

 

[osusev]

T I am a green weenie and I am not real sure about the cap and trade program.

 

I could see tax BREAKS on a large scale to go green for companies but tax hikes to penalize and then that cost be pushed down the line to consumers seems like a flawed principle.

 

Just like oil per barrel costs when they rise refiners just pass the increased cost onto the consumers. I suppose the theory on higher energy cost will lead to more innovation and responsible use of energy.

 

The more I think on this the more I think it will just push more jobs overseas to avoid the whole system all togeather. I dont think there is a right or wrong way but my gut tells me this wont actually help in becoming more green worldwide in fact I think it will accelarate third country development for more manufacturing in uncontrollable countries.

 

Like Tupa said this is way to early to even know any real specifics

[Westside Steve]

Thanks Toop.

I'll list the reasons I don't particularly like it (again) in another thread but I appreciate your response.

I just didn't want to find out I'm bitching about the wrong plan.

 

WSS