Monday, October 18, 2010

Tree-Hugging for Dummies

According to Politico.com a couple weeks ago, Senators are agreeing with President Obama's call to break up the climate bill. Could this be the better approach? As we saw with healthcare (’93 and ’09), market reform, and other attempts at sweeping pieces of legislation, giving this many people a say in a complex issue may not be a good thing – 100 Senators are obviously incapable of developing an efficient mechanism for delivering sensible policy, and throwing a bunch more Representatives in the mix simply makes it more interesting. Add the Executive Branch, and kiss a reasonable policy outcome goodbye.

An effective climate bill is best designed by 5 people (2 energy experts, a climate scientist, a political scientist, and me) in a room absent the undue influence of lobbyists, self-preservation, and idiocy. I’ve long defended China’s unofficial climate policy of 'invest in smart renewable and energy efficiency,' and I think it works better here too (e.g., Obama’s stimulus package). Make energy efficiency incentives our primary GHG reduction vehicle, not carbon derivatives; I’d rather our main focus be on saving money, not manipulating it. By doing it piecemeal and only passing the stuff that makes sense, you can avoid situations like “coal plants will have to have permits to pollute, but then we’re just going to give them away because they can’t afford it in the short-term, but fertilizer producers will always get free permits through 2025 because it’s so energy-intensive, but…” (FYI: that was just a snippet of Kerry-Boxer.) I think cap-and-trade can theoretically work, though it’s not my preferred method. I don’t think cap-and-trade can be passed in America without creating some seriously inefficient market distortions.

Another idea: Senator Lamar Alexander (R-TN) has come out for legislation limiting the 3Ps (the pollutants sulfur dioxide, nitrogen and mercury), rather than greenhouse gases. This is an interesting idea, because it provides a method for limiting GHGs without this being the stated purpose. Even the most vehemently anti-science conservatives must acknowledge the harm of mercury pollution. Coal combustion just happens to be large creator of mercury pollution. Alexander could simply work in a bipartisan manner to reduce the things that cause deleterious health impacts in children. As luck would have it, actions taken to reduce asthma and cancer locally also happen to have rockin’ global externalities. Unstated intentions, intended consequences.


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