With Cap-and-Trade Proving Unworkable, It's Time for Plan B, Say Carbon Tax Advocates

With Cap-and-Trade Proving Unworkable, It's Time for Plan B, Say Carbon Tax
Advocates

WASHINGTON, July 13 /PRNewswire-USNewswire/ -- The Waxman-Markey cap-and-trade
bill barely passed the House and appears to be faltering in the Senate; it's
time for Congress to consider a more straightforward alternative to the
unwieldy cap-and-trade approach, a coalition of environmental groups told the
Senate Monday. At a Senate briefing today, a panel of scientific, economic and
legal experts discussed the drawbacks of cap-and-trade and advocated a direct
tax on carbon emissions with revenue returned to the public, preferably
through payroll taxes reductions, as the best approach to passing effective
climate legislation.

Panelists who spoke at the briefing included *Dr. James Hansen*, leading
climate scientist; *Dr. Robert Shapiro*, Co-founder and Chairman of Sonecon
and the U.S. Climate Task Force, and former U.S. Undersecretary of Commerce;
*Cecil Corbin-Mark*, Deputy Director of WE ACT for Environmental Justice and
Co-Coordinator of Environmental Justice Leadership Forum on Climate Change;
*Professor Janet Milne* of Vermont Law School, contributing author of "The
Reality of Carbon Taxes in the 21st Century." *Brent Blackwelder*, President
of Friends of the Earth, moderated. The briefing was hosted by the Carbon Tax
Center (www.carbontax.org), Climate Crisis Coalition (www.climatecrisis.us),
and Citizens Climate Lobby (www.citizensclimatelobby.org).

Last Thursday, Senate Environment and Public Works Committee Chairman Barbara
Boxer announced that the Senate's climate change bill won't be ready until
some time after lawmakers return from August recess, a month later than
previously planned. The delay raises doubts about whether the current bill can
garner the votes to pass.

The House bill, the American Clean Energy and Security Act, passed by only the
slimmest of margins (219-212) after last-minute deal-making further weakened
its provisions and ballooned the legislation to over 1,400 pages. The vote on
the bill, authored by Rep. Henry Waxman (D-CA) and Ed Markey (D-MA), broke
along partisan lines, with only eight Republicans supporting the measure, and
several progressive and environmentally-oriented Democrats voting against the
weakened measure.

"The political weakness of Waxman-Markey is actually a positive sign for the
climate," said Marshal Saunders, president of Citizens Climate Lobby.
"Cap-and-trade is a very tough sell in the Senate. If Congress has any hope of
passing meaningful climate change legislation, it will have to consider Plan B
- a revenue-neutral tax on carbon pollution. Waxman-Markey stalling in the
Senate could be a turning point towards something that will actually work."

"The Senate must do better than the House," said Tom Stokes, Coordinator of
the Climate Crisis Coalition. "Cap-and-trade tries to hide the carbon price,
which gives opponents license to make outrageous claims about its cost. In
contrast, the cost of a revenue-neutral carbon tax would be clearly known.
With unemployment at 9.5% and consumer spending down, using carbon revenues to
boost every worker's take-home pay will help address both the climate and the
economic crisis."

"President Obama stresses the need for open, rigorous debate to develop sound
policy. Supporters of the Waxman-Markey bill maintain that it is the most
important piece of environmental legislation ever, yet they cut off discussion
of direct carbon pricing: a simpler, more effective policy supported by most
economists and a growing spectrum of concerned citizens. Not a single hearing
addressed or explored revenue-neutral carbon pricing as the principle
mechanism for containing greenhouse gases," Stokes said.

"The compromised and fundamentally flawed Waxman-Markey cap-and-trade would
lock-in an ineffectual approach that would accomplish little, while blocking
effective action for years," said Daniel Rosenblum, co-director of the Carbon
Tax Center. "The main beneficiaries would be Wall Street and polluters who
want to be protected from having to take prompt action. The Senate should
start over with a simpler and more understandable carbon pricing system that
will do what cap-and-trade won't: encourage energy efficiency, clean renewable
energy and prevent catastrophic climate change."

Briefing panelist and leading climate scientist Dr. James Hansen, argued the
Waxman-Markey approach would fail to reduce CO2 emissions enough to prevent
catastrophic warming. "Continuing to increase burning coal, oil and gas will
soon drive atmospheric CO2 well over 400 ppm and ignite a devil's cauldron of
melted icecaps, bubbling permafrost, and combustible forests from which there
will be no turning back," Hansen said. "The Waxman-Markey bill locks in fossil
fuel business-as-usual and garlands it with a Ponzi-like 'cap-and-trade'
scheme... It sets meager targets -- 2020 emissions are to be a paltry 13% less
than this year's level, far short of the trajectory needed to return
atmospheric CO2 to safe levels -- and the bill sabotages even these by
permitting unverifiable 'offsets,' by which other nations are paid for
projects, most of which would have been undertaken anyway. A far superior
alternative to cap-and-trade is a rising carbon fee, which provides the best
incentive to move to ever higher energy efficiencies and carbon-free energy
sources. As engineering and cultural tipping points are reached, the
phase-over to post-fossil energy sources will accelerate."

Briefing panelist Robert Shapiro, former Under Secretary of Commerce, pointed
out that the trading component of cap-and-trade -- buying and selling permits
to release CO2 -- would also create a trillion-dollar market in carbon futures
and derivatives that could crash financial markets again. As he wrote in
April, "The unavoidable volatility of the prices of emission permits... would
attract furious financial speculation, since speculators live off of volatile
prices. And we now know the risks that we all run when rampant speculation
occurs in financial instruments tied to our economic foundations, such as
housing -- or energy."

Briefing panelist and Vermont Law School professor Janet Milne cited the
carbon tax's recent track record outside the U.S. as evidence of its political
strength. In British Columbia, Premier Gordon Campbell and his Liberal Party
passed a revenue-neutral carbon tax last summer, and despite an aggressive
campaign against it, went on to win reelection in May.

In addition to the hosting organizations listed above, today's briefing was
co-sponsored by Friends Committee on National Legislation, Friends of the
Earth, Progressive Democrats of America, The Clean Coalition, WE ACT for
Environmental Justice and Price Carbon Campaign.

SOURCE Climate Crisis Coalition; Citizens Climate Lobby; Carbon Tax Center

Steve Valk, +1-404-769-7461, valkano@comcast.net, or James Handley,
+1-202-546-5692, jashand@juno.com, or Stephen Kent, +1-845-758-0097,
skent@kentcom.com, all for Carbon Tax Center