There is a brilliant moment in the movie Annie Hall when Woody Allen is arguing about the work of philosopher Marshall McLuhan with a rather arrogant academic type when McLuhan magically appears out of nowhere to support Allen and says to the pompous twit, “You know nothing of my work.”
One thinks of that scene when listening to St. Michaels resident and environmental economist David Montgomery on the concept of cap and trade emissions to reduce pollutants like phosphorus in the Chesapeake Bay. He is fascinating to listen to for many reasons, but the most important of which is that Montgomery is credited with having actually proved over forty years ago that the cap and trade economic theory actually worked.
It was David whose Ph.D thesis at Harvard in 1970 converted hypothetical theories of cap and trade into the complex formulas that demonstrated that emissions trading was economically feasible. This finding would eventually lead President George H.W. Bush, and such innovative groups as the Environmental Defense Fund, to support amendments to the 1990 Clean Air Act to control the emissions of sulfur dioxide through this radical free market solution. And it turned out to been one of the country’s most successful pollution success stories.
But since that golden moment, cap and trade have become a political football, vilified by both the political left and the right, as either a roadblock to growth or providing unfair economic benefits to certain stakeholders.
In his interview with the Spy, the former Fulbright scholar, and now semi-retired energy consultant, talks about the early years of cap and trade, and how it might very well be the best and most cost-effective solution for dramatically reducing phosphorus emissions in the Chesapeake.
Kirk French Jr. says
“But since that golden moment, cap and trade have become a political football, vilified by both the political left and the right, as either a roadblock to growth or providing unfair economic benefits to certain stakeholders.”
Wheelan says it right. Unfortunately, the only way that Cap and Trade or a system of tort could ever achieve actual results, the federal government would need a complete overhaul; one that is not going to happen anytime soon.
As long as Environmental leaders continue to push for new legislation on pollution they do a disservice to the people. Take for example the EPA’s restrictions on new sources of pollution. New Coal plants that can be 10x safer than old plants cannot get a permit from the EPA because of the barriers that are created by legislators who are lobbied by environmental foundations such as the CBF.
Stop giving grand father protections and the old plants will shutdown while new plants open up. You cannot stifle economic growth otherwise we return to the days of the old.
Measure and Tax it based off of output.