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December 03, 2007 07:36 PM UTC

Colorado Carbon Markets

  • by: bpilgram

( – promoted by Colorado Pols)

If folks are serious about global warming rather than just complaining about it or looking for who should be blamed, we ought to be discussing solutions.  Here’s one idea.

At a high level, the Kyoto Protocol created a world-wide market in greenhouse gases.  The basic idea was to cap or reduce growth in greenhouse gases.  Countries with higher growth rates that would generate more greenhouse gases could buy credits from counties with lower rates of emission.  The process imploded when the US, China and India refused to participate.  

How about applying that same concept at a micro level in Colorado?

Here’s how it might work.

Carbon loads for various activities can be calculated.  They might include:

(1) the carbon load generated by an electric power plant expressed on a MWh unit;

(2) the carbon generated by producing a ton of concrete;

(3) the carbon produced by vehicle (published just like MPG ratings are published); and,

(4) the carbon produced by laying down new roadway.

The carbon reducing capacity of vacant land and trees can also be estimated, which is not a terribly complicated endeavour.  When I worked there as a grad student, the California Department of Water Resources estimated water usage for crops by using satellite photos of the state and employing only 3 grad students and an engineer for the exercise.  Likewise, every county in Colorado establishes a market value every two years generally using econometric models and one or two staffers.

Similar techniques could be applied to estimate carbon reduction characteristics of land types (e.g.,. the rock summit of Pikes Peak or downtown Denver will have lower or zero carbon absorption capacities whereas heavily forested areas (private or public lands) will have greater capacity; grasslands will be somewhere in between).

Carbon emitters would be required to buy some fraction of carbon offset (100%, 75%, 30%, you pick the number) from the owners of the lands.  The owners would include both public and private land owners, so a far proportion of the purchases would be payments to government entities.

Those who sell carbon credits would sell a carbon easement that would be recorded and run with the land.  If they later developed the land, they would be required to replace the easement and meet whatever carbon requirements their new use would have.

The key positive elements of this idea in my view include:

(1)  The idea is not a tax that funds government activities (e.g., workshops and feel-good activities) that will, in all likelihood be unrelated to solving the problem.  Government’s role is limited to deciding what carbon producing activities would be subject to the market, setting the exchange proportion between carbon emitters and carbon reducers and establishing the official estimate of the carbon reduction per acre for various land uses in the state.

(2)  The market sets the price of the exchanges that take place.  Those prices will change over time (e.g., lower now and higher over time) unlike tax rates that tend to remain fixed or change only as political parties change.

(3)   People (including government carbon-emitting activities) are economically incented to reduce carbon emissions either by driving more efficient vehicles, using less concrete, etc.

(4)   Unlike carbon taxes that can change with political winds, this seems more permanent as it creates private easements and private property rights which tend to remain intact between administrations.

(5)   It is a Colorado solution that does not have to be developed with the approval and consent of 435 members of Congress or a world-wide mega-agreement (like Kyoto).

I realize that this idea is so far out of the box that it is unlikely to ever be pursued by  Colorado legislators, but I think it’s worth floating to see what folks’ reactions are.


55 thoughts on “Colorado Carbon Markets

  1. Thanksgiving day we saw a first in the NFL. In Detroit…yes the land of the automobile mfg’s…..the Detroit Lions organization calculated the carbon – emissions created by the game and purchased carbon offsetting credits. I don’t have any further details, but thought it way cool (no pun intended:-).

  2. You understand, too, why it can’t happen.  Too radical for tiny minded goosesteppers of either party.

    But once the idea of eradicating slavery was thought out of the box, too.  

    1. But it seems to make sense.  Don’t kid yourself though and think the government (under any party’s rule) won’t scam a piece of that action.

      We’re lucky they didn’t implement an internet tax as of yet.

      1. If they did (and it is coming), then the sellers will simply move to another state or country. Not the ppl, just the company (or possibly the site). The nice thing about this, is that ALL countries are willing to host because they will get the jobs, the energy boost, and the improved telecommunications links. Look at India, Brazil, Argentina, Russia, etc.

        BTW, pols, nice in-line posting. How does it work in opera, safari, and konqi  (actually, as soon as I get home, I will try konqi).

        1. Best browser in the world….except for some retard web masters that use M$ and other variants of HTML, Java, etc.  

          I love how it customizes and the “In Page” search functions.  Far better than Firefox.  

          MS Exploder?  Haven’t a clue what they have copied from Opera and whatever.  “Freedom to Innovate”, remember than canard?  More like “Freedom to steal.”

          1. who’s a game developer, once went down a list of all the successful software Microsoft sold and explained how not one of their products was innovative. Every one was either a) copied after other successful programs (IE at that time being the latest example, copied from Navigator) or were simply purchased from the original developers (starting with DOS). They had not actually created any new, unique software that sold well.

            1. …IE was a browser already in existence. I can’t tell you the name, Wikipedia is not up at this moment (and my memory never is!)  Similar to Sun Java, they bought the rights to develop it in certain ways.  Unlike Java, they ran away with it and it became IE.  (Sun yanked the rights to play with their Java when they saw how far away from the permitted work it had gone.) Pure arrogance.

              Otherwise, I full concur with your BIL.  M$ does make damned good hardware, BTW.  

              1. MS does have some innovation, but damn few of them. BOB was certainly a MS innovation (actually, I thought it was interesting). In addition, so is clippy. I just found out about this a year ago (I only do MS at this last and current job; When I was doing work for the NSA/DOD, we were prohibited from doing Windows). They need to shoot the idiot that included that in office. I forget, but there was 1 piece of hardware that was theirs.

                IE was legally stolen. The cut a deal with the other group that came from Mosaic. A nice business deal that said that they would pay them a dime for each browser that they sold. Of course, MS never had any intention of selling it. They did a similar deal with Sybase to obtain their DB.

                My friends that sill work at MS have told me some dozy stories.

                1. The only success BOB produced was in introducing Melinda to Bill Gates (she was the manager in charge of that project). And it sounds like, from your and Parsing’s posts, that IE was half-innovated at best.

                  This discussion took place maybe 7 or 8 years ago, before they came out with the X-box (their last new major product IIRC). I’m not a gamer, though, so I can’t comment on whether there was anything advanced about it, compared to its competitors.

                  1. They should stick to it.  Great joysticks, good keyboards and actual innovations in mouse design.  If the only thing I ever saw from Microsoft was hardware, I’d be singing their praises.

                    IE was “licensed” from Spyglass, and as already noted, it was pretty much stolen.

                    The XBox is just a repackaged PC with a stripped-down, streamlined version of Windows on it.  The controllers are USB with a custom connector.  Considering that the competition was essentially running a generation behind at the time, it was powerful if not innovative; a hardcore gamer’s PC would have been nicer, but too expensive for them to sell as a console.  I’m not sure on the specs of the XBox 360, but I do know it’s not running on Intel hardware any more – IBM got the contract to develop both the PS3 and 360 chip sets, though they’re vastly different architectures.

                2. Well said, that was my point.

                  Clippy can be turned off in Orifice.  I can’t tell you how, but I’ve done it.  It also “went away” for a few years; it is my understanding that it is back in the latest.

                  I use WordPerfect 12.  Will work on every WP version ever made. It loads fast, has an excellent PDF engine built in, and much more intuitive controls.  Even Word users have agreed after trying it.  Buy it for $20 on eBay, legit.  

                  I also use Opera, Firefox as backup to Opera, Quattro Pro that comes with WP, Thunderbird for email.  I have Open Office installed but never use it; it takes forever to load, for one thing.

                  The only MS software I use is Outlook (Look out!) for contacts backup from my PDA.  WordPerfect, BTW, can use Outlook.

                  Now, if there was only a Linux that had drivers for everything I own…..

                  1. You’d be surprised at how good the driver support on Linux is, though – if you get the right distribution or download the right utilities.  For example, Linux has support for the latest Dell wireless cards – but not in the latest Fedora 7 install.  Linux has support from NVidia for their entire card set – if you get the driver from NVidia.

                    Contact me offline if you really want to check up on hardware support that you think you’re missing.

                    1. ..I can’t count how many hours I’ve spent on the Holy Grail, and even some dollars.

                      One of the driver issues is that while, for instance, there are universal generic printer drivers, features for a specific printer aren’t available.

                      I didn’t even mention that many of the graphics programs that I use in Win-doze have no equivalent in Linux.  Linux is similar to Mac, yes, in theory you can do anything, but the SW choices are limited. No WordPerfect, no Outlook contact manager w/o WINE and a prayer, etc.

                      Garmin, the dominant GPS company, doesn’t even bother to make programs for anything other than Windows. Nor most analog video conversion cards or TV cards.  

                      Someday, mebbee, there will be a Unix/Linux/Other OS than can just natively convert the API’s.  Until then, I must hold my nose and enrich Bill Gates.  

                    2. First, what hardware do you have that does not have drivers? I am in the process of writing a couple of USB drivers right now for some esoteric hardware of mine (I have done filesystems and networking code in the past, but want to do something a bit different). But in general, Linux has far better driver support than does most of the windows series (not XP).

                      What Tv Card are you saying that is not supported?

                      GPS is a bit of an issue. There are drivers for some of the items, and there are programs there to do some of the same stuff as Garmin, and even Jepp. But Windows owns this arena.

                      Since you mention WINE, I believe that it will run WP. But why not skip it and go with OO instead? IIRC, Staroffice supports RW of WP format.

                    3. Don’t make more work for myself than I have to.

                      The video card is NavisPro.  Not video out, it’s a hardware type capture card.  Should have been more specific. Old, now.  

                      I don’t want to do work arounds, try a new kernel, or not be able to use my GPS and mapping programs, or find a solution in prayer.

                      I like having lots of SW choices.  I use Irfanview for basic graphics viewing and fast, fast, fast image modifications. Just a quick look at the media programs I mostly use (there have been others that have come and gone) I find Audacity for working with audio files, DVD Indentifier, DVD Shrink, Exifer, HP Photo Printing, Scenalyzer, TMPGEncoder, my Canon scanner, U-Lead DVD Movie Factory, Pinnacle Studio Plus.  I did not count SW available in Linux (Nvu, for instance), or programs that have an equivalent native Linux (DVD players, for instance.)

                      Yes, there may be some Linux programs that do the same thing, get the same results, but most of these I listed have been the winners for me because of how they work. This is also my issue with Mac, a lack of choice, especially freeware.

                      There is a reason that Linux has over 50% of the server market and a bare smidge of the destop market.  And it isn’t that we aren’t unenlightened.  

                    4. I hear you about being tired of dealing with changing things out. For years, I have jumped all over while coding away. But my time is more important than that. I currently use kubuntu  just because I got tired of jump through hoops.

                      For the navisPro, try the IvTv driver. I have to use it for several hauppauges.

                      what distro/kernel you using?

                      Well, I do not know all the programs that you have since I have only been using Xp for about 2 years and it is minimal (sick and tired of the rebooting and the hassles with admining it; piss poor design). Sadly, the only time I used windows heavily, was win 3.1 (and I actually pushed NT 3.5 as being an ok server).

                      As to Linux’s desktop, well that is America only. Right now, Linux is booming outside of here. I think that you will a number of new programs coming from outside of the US.  

                    5. I didn’t switch from 98SE to XP until Vista came out.  And the primary reasons I did was only that more and more programs, such as Google Earth, won’t run on the 9x-Me kernel.  98SE was fast as hell and could be repaired easily.  

                      Try to reinstall NOT from scratch XP.  Yes, it can be done, but it’s like walking on eggshells and takes forever.  

                    6. First, what hardware do you have that does not have drivers? I am in the process of writing a couple of USB drivers right now for some esoteric hardware of mine (I have done filesystems and networking code in the past, but want to do something a bit different). But in general, Linux has far better driver support than does most of the windows series (not XP).

                      What Tv Card are you saying that is not supported?

                      GPS is a bit of an issue. There are drivers for some of the items, and there are programs there to do some of the same stuff as Garmin, and even Jepp. But Windows owns this arena.

                      Since you mention WINE, I believe that it will run WP. But why not skip it and go with OO instead? IIRC, Staroffice supports RW of WP format.

            2. First off, it’s rare to come up with something truly original in the s/w world. First off, by definition almost everything builds on previous work. Google was actually a slight improvement over AltaVista.

              For truly original from Microsoft, I’d say their MSDN offering (it’s s/w, website, support, websites, etc) is in whole groundbreaking and way beyond what anyone else had come up with.

              I’m sure there’s other stuff. But I’m having trouble thinking of any truly groundbreaking app out there from anyone.

              1. I lived in Seattle for 8 years and although I managed not to meet anyone who worked for them (save my same brother in law, though he did that as a temp for a few months as a stopgap between “real” jobs) their presence was keenly felt.

                  1. But now they’ve developed the Sammamish Plateau, but that’s closer to Issaquah.

                    When did you work for them? During the “get rich from stock options” era?

              2. Google was a slight improvement on AltaVista? Uh, that is like saying a formula 1 racer is a slight improvement on a go cart. HUGE JUMP.  In general, Altavista was taking a brute force approach to looking at the data. They used keywords and simple word searching. Very little heuristics involved. In fact, you can get similar capabilities from SWISH.

                Their speed was derived by running monster Sun boxes. In fact, Altavista had already hit the end of their road and were starting to decay.

                OTH, Google used other sites to create the relevancy, which is why to this day, it remains the #1 search engine. Heuristics were created and improved on. In addition,  Google moved to MASSIVE parallelism to handle the requests. In fact, prior to Google’s approach, most everybody would try to move up the hardware (i.e from linux|bsd|MS to Unix to Mainframes). Google MADE parallelism the norm for handling huge # of requests. Of course, you could argue that this was simply a copy of such works as Tera-data or think, but the original search engine protocol WAIS had actually dissuaded ppl from parallelism to doing a single site/single hardware approach. It was VERY slow and did not scale well due to lack of bandwidth and hardware.

                MSDN was, in general a straight copy of what the Linux env. was doing, though it added a number of incremental improvements. In particular, from 92-98, Linux was considered the total model to follow for help, which is what MSDN was developed to emulate. At that time, even the PC type mags were giving the OSS world the awards for best developer support.

                To see how MS has stood up on innovation, though it is dated.

                I personally think that BOB was underrated. I wish that MS had given it more time. Had they done so, I think that they would have changed  the level of home integration. Of course, BOB used a LOT of CPU, but hey, Intel likes that. Who knows, perhaps MS will bring back a better version of BOB. The Israeli’s have some nice software for interpreting voice. Basically, they used a GA to help develop an interesting neural net, and then spent lots of time on training (2 years; which is interesting since the idea was that it should take about the same length of time as a baby).  Something like that integrated with BOB would be useful in controlling a home.

                1. …vehemently.

                  BOB was a good concept, but a horrible execution.  There actually was a BOB98 – I saw it on the shelf of a Borders once.  It was one of the few things that Microsoft truly innovated, and also their most spectacular failure.

                    1. Bob was a “usability” package.  It presented your computer as an office – desk, file drawers and everything.  It was supposedly designed to make things more intuitive for a beginning user.

                      In reality, it was a hog and IIRC it looked like drek on a VGA monitor; it also had an interesting view of security – it had a password, but if you mistyped it three times it assumed you’d forgotten it!  It might be cool with today’s technology – a Wii controller, 3D graphics card, voice recognition and current 3D desktop software could really do it justice.

  3. It seems like such a vague system, subject to a lot of complexity and the potential to cheat the system.  But it has a lot of merits too, and I think we could be effective at some level in an implementation.

    Such an implementation would be a massive undertaking, involving a significant initial government outlay to create the initial credit and debit balance sheets for each resident, entity, and future development/purchase.  Such a system would need to be simple if we want to involve every person in the state.  And we have to ensure that we aren’t blocked by Federal regulations; the auto industry and some chemical facilities have some pretty good cover nowadays at the Federal level.

    I think, realistically, that such a system almost needs to start at the state level; states can then trade between themselves, and that system could develop into a multi-national system.  Starting from the top is a good idea conceptually, but probably impossible to implement in a time period of less than decades.

    Now…  To implement, we need government startup funds – where can we divert enough money to fire up the program?  This can’t be done without legislation, but some of the state’s energy conservation funding comes from fundraising and not through the general budget; that money might be usable for feasibility studies or to spec out legislation for submission later in the year.  I know a decent number of folks at the Governor’s Office of Energy Management and Conservation; aside from the actual legislation, do we have any idea of what’s already been done and what needs to be done before we can implement?

    1. since no-one in national or international politics is going to be able to stand up for a carbon tax. I think a cap-and-trade system would be inefficient, non-solvent, and prone to loop-holes when compared with a simple carbon tax (the policy of choice for economists of all stripes, from former Clinton Treasury Secretary Lawrence Summers, to Alan Greenspan), but it’s all we’re going to get so I’ll take it.

      Here’s a list of some of the notable supporters of a carbon tax over a cap-and-trade system:

    2. When I was in grad school in California, the Department of Water Resources needed to estimate the water usage of all crops and urban areas in California to respond to the drought crisis de jure.  That exercise seems comparable to the scope and complexity of estimating the carbon absorbtion by land type in Colorado.

      To do the job in a cost effective manner, we took satellite photos of the entire state that identified crops under cultivation and divided up the state into a bunch of squares.  Knowing the water requirements of rice, corn, oats, etc (all identifiable from satellite photos), and the average urban household water usage, we we able to estimate the land area under cultivation by crop type in any month and estimate water demands very closely.

      That was done more than 25 years ago with only a couple grad students from UC Davis and an engineer to supervise them.  It was done in a single summer using mainframe computers where data had to loaded with punch cards, no dedicated office space and the methodology was used for many years afterwords.  It was accomplished in the midst of Prop 13 spending limits and without the durm and strang of bureaucrats and legislators whining about budgets.  Not a massive government program even in a state known for such things.

      I suspect that a handful of bright grad students today could come up with decent estimates of carbon absorbtion by land type in Colorado today in a summer.  Given the interest in global warming, I would not be surprized to learn if that work has already been done by a PhD student.

      Surveying what’s already been done is not a very difficult, time-consuming or expensive process.

    3. When Poppa Bush’s admin developed it in the 80’s, it was being applied to pollution coming from single sources of pollutions (power plants) in already small amounts. In each case, these pollutants were already being monitored, so it is fairly easy to cap/trade.

      Kyoto is trying to apply it to the world, where we are going to ask multi-points to be controlled. These multi-points such as cars, take NO direct responsibility or even being directly monitored. It will almost certainly not work. Worse, many of the kyoto nations are playing games with it. They all pushed false inflated amounts of CO2 from their nation so that right from the git-go it appears like they made 10% cuts. Of course, they did little to nothing to gain that. Now comes the hard work for those.

      For the CO2 issues, I would rather see that all kyoto countries simply charge a Value added tax (VAT) based on the carbon where the item came from. So, in the states, we would might charge based on which state, or which country. Something from Wash. would  have no tax (hydro and nukes makes them the cleanest state), while something from Texas or Pennsylvania would get hit hard (filthy states). BTW, Colorado does not rate great on that. Likewise, from outside of the states, we would simply look at the country. That means that items from Canada, France, Japan, and a number of countries in South America including Brazil would have little tax. OTH, China, Russia, Ukraine, etc would pay MONSTER taxes. Sadly, we would get hit hard by other nations. But the idea is to encourage ALL nations (even the small ones), to move away from dirty energy. It would drive America quickly towards nukes and alternative.  

  4. It accomplishes the same thing and if the taxes are offset by deficit reduction and/or reducing other taxes, remains neutral while eliminating the need for a new bureauracracy.

    There would be one tax for carbon produced and a second for oil. The oil tax is to cover our cost of the Iraq war, troops in Saudi, the fleet in the Persian gulf, etc.

    – dave

      1. the bases left-over from the first Gulf War? Source of immense hostility and discontent across the Arab world on par with our support for Israel? Admittedly we have dramatically decreased our presence there, but to the best of my knowledge, Taif Air Base is still there.

          1. (most of our troops being involved next door), so it’s true that the monetary cost to maintain the bases is probably fairly small, but my point was that they incur a far greater cost, namely, Arab hostility towards America.

                    1. It’s up to them if they go work there.  Should we start allowing or not allowing US citizens to go work places at the behest of cavemen?

                    2. And if it’s a military base, we need to weigh the pros and cons. As long as the Saudis want us, we should probably stay. But we need to realize it does have a price.

                    3. If it’s a base, it’s not ours. Most are civilian contractors in high-tech military jobs .  It’s a very low profile presence.

                  1. My brother currently works for large DOD related company in a civilian capacity in south korea. He switched to playing sys. ad. , but he used to work on apaches followed later to doing power. After our invasion of Iraq (OIL/OIF), my brother was notified that he may be called back up to handle power again AS A CIVILIAN (when he pointed out to the DOD that his fully retired from active duty and his inactive status was over, his employer informed him that he would be going as a civilian attached to their company). He was told that he would go right back to where he had been in desert storm, which was Saudi Arabia. Apparently, there are a number of civilians working there on the base. It is possible that SA is paying, but these ppl are doing our work.

                    1. That the US “footprint” as seen by the locals is what’s important.  We’ve always had tons of US citizens there in different jobs related to military, high-tech and petroleum.

                      That’s a far cry from huge, sprawling US military bases, and soldiers cruising into local towns to shop, etc.

  5. Love it, with a few minor caveats.

    There is a reason that Kyoto was supposed to be global and that it imploded when major players refused to engage. Taking unilateral action could have huge costs if not everyone agrees to play by the rules. If Colorado unilaterally pursued a cap and trade program, placing a large cost on ghg emissions, it would make Colorado a much less attractive place for heavy industry, power generation, etc. In response businesses might just choose to build new factories or power plants across state lines in Utah or New Mexico. Sure there are technical fixes that could prevent some of these problems but the general point that it would increase the cost of some economic activities in Colorado vs. neigboring states is valid.

    The good news is that the Governor’s of California, Oregon, Washington, Arizona, New Mexico, Utah and Montana, along with a few Canadian provinces, have entered into an agreement to create a regional climate cap and trade system along the lines of what you are talking about. The goal is to reduce emissions 15% by 2020 region wide. This may not be quite in line with scientific guidance on the necessary emission reductions but it’s a huge step in the right direction. Colorado,(along with the rest of the Western States, Wyoming, Idaho, and Nevada) was invited to participate but hasn’t yet signed on.

    If all this sounds crazy, or just too be true, please read more about it at http://www.westernclimateiniti

    The other minor issue is that I would be careful not to put too much emphasis on land based offsets. First and foremost, there just aren’t enough land based sinks to offset a significant portion of ghg emissions. Furthermore, offsets, as currently conceived and executed in places like the Chicago Climate Exchange, have serious problems in terms of verifiability, durability, and enforceability. These problems have led many critics to argue that they don’t represent real emission reductions. This could obviously be remedied through a better offset program and the Governor’s Energy Office is currently working on setting up a more rigorous standard for will hopefully address some of these problems. Still it’s an area that should be treated with some caution.

    For all these reasons, concrete reductions, through energy efficiency, renewable energy, conservation, etc are much better.

  6. every human being on the face of the earth is alloted “X” amount of greenhouse gas production, not just CO2, not counting what they exhale.  

    Those that use more pay into a fund.  Those that use less, get some form of rebate.

    “So, Mr. Bangladeshi, what will you do with your $20?  I mean, 15 Euros?”

  7. We collectively have five policy choices for global warming:

    (1) Taxes.  Carbon taxes to reduce/penalize CO2 emissions

    (2) Cap and Trade.  Carbon offsets to reduce/penalize CO2 emissions and encourage/grow CO2 sinks.

    (3) Something Else.  Be open to some other proposal or proposals to reduce CO2 emissions even when such proposal may be inconvenient or politically hard to do (e.g., 55MPH speed limits, MPH standards, school week changes, open the window rather than use the air conditioner in public buildings, etc.)

    (4) BAU (Business as Usual).  Continue to argue, look for somebody to blame, complain about budgets and, in the end, do nothing.

    (5)  Cinderella Solution.  Do nothing and wait for the government — Prince Charming — to save us and worry about whether the government solution will take away money from poor kids, old folks, health care, the war in Iraq, or ___ [fill in your favorite social program]

    The nature of our political system is that options 4 or 5 are our default choices.  They are the options we have chosen for our kids unless we get off our collective butts and demand substantive change.

    Think about the solutions as if we were all passengers on the Titanic.

    Solution 1 is plug the hole, but live with the water already in the ship and hope the ship doesn’t sink.

    Solution 2 is plug the hole and bail water.

    Solution 3 is think of something else, including call for help from other ships.

    Solution 4 is blame the captain and argue with the crew and passengers about whether we hit an iceberg and who is at fault and worry about whether we have the money to fix the hole or bail the water and agonize about whether fixing the hole means the folks in 3d class won’t have ice cream for dinner.

    Solution 5 is wait patiently in your deck chair for the crew to come and tell you what to do.

    1. You take the view that the government cannot effectively regulate.  I don’t believe that.  Furthermore, the cap-and-trade system is also a government answer – just a different one.

      Lots of ways to go about it – heck, we could tax, incentivize, and cap-and-trade all at the same time except for all the griping about being hit multiple times for the same problem.

      The important part is to get some stronger initiatives in front of the Legislature or the people.

    2. I believe in using market factors when they can help.  Cap and trade is a good system. Tax and rebate is a good system.  Both change the incentive/disincentives, but neither get the externalities into the pricing.

      Even though I would like to get externalities into pricing, nothing is perfect.  You always need to keep administrative costs down and I would be happy with either system.

      I am not anti regulation, but I think for changing consumption patterns, changing incentives is more effective.

      1. I’m not sure whether or how either deals with externalities given that the actors affected by the externalities have not been born.

        Any thoughts would be appreciated.

        I’m trying to figure out how Coase might view this (met him once when he was a very old man), but I’m stumped.

        1. I think both can be useful. tax revenues can be either trust funded or used for remediation.  I know you are not a fan of government intervention, but if anything this is a place for it: multi generation, multinational problems are not easy baby’s to split when assigning property rights.

  8. Having spent over 20 years modeling precipitation, runoff and turbulent fluid flows-I know one thing-weather and climate are among the most complex and non-linear phenomena studied by mankind.  Scientifically, it is agreed that CO2 is known to transmit shortwave radiation from the sun, and block longwave radiation reflected from the earth, resulting in a net radiative heat gain.  It is uncertain how other forces might attenuate or amplify this heat gain.  It is unknown (though frequently speculated) what the impact of either doubling or halving the atmospheric concentration of CO2 would be.  It is unknown how fast natural systems reabsorb atmospheric CO2.  

    Using the tax code or some bureaucratic agency to “cap” CO2 in an effort to control climate change is the peak of hubris.  The only rational technique to manage climate change is to identify vulnerable geographies, and address those vulnerabilities.

    I laugh out loud everytime I hear some car company, or home builder, or NFL team say they’re buying carbon offsets for whatever slice of gluttony they are selling.  Didn’t Martin Luther start the Reformation to protest the sale of indulgences?


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