Problems with emissions trading – The Story of Cap & Trade

A compelling wee video that exposes the problems of emissions trading from the same person that made The Story of Stuff.

The Greens have been keen on a carbon tax since 1993, and only supported Labour’s ETS after much soul searching and negotiating some big improvements as it was the only game in town. It was relatively easy to dismiss National’s version, as they fell into many of the traps outlined in the video above.

Feel free to discuss solutions to climate change in the comments, but just for once, let’s not have a discussion about whether climate change is happening, aye? As an experiment, off topic comments will be deleted.

10 Comments Posted

  1. Having finally found 10 minutes watch the video, I was rather disappointed that you linked to such a facile presentation.

    Some of the material could usefully be packaged as ‘Ways C&T can be subverted’, but since we can expect political opposition to any carbon limitation measure we would have to contrast the susceptibility of various methods before damning C&T. (For example, Tim Harford makes an interesting point that a carbon tax might have been easier to settle at the international level.) The video actually sounds quite comfortable with a C&T system at 4:40 – “Instead of just giving permits away to polluters, we could sell them and use the money to …”.

    The first section, on how all markets are bad and manipulated by Goldman Sachs, would have benefited from comparison to commodity markets rather than equities as well as an expansion on the real-economy (real-climate?) effects of boom and bust. A cynic might ask whether the fear was of the high carbon price of a boom or the low emissions demand of the widespread recession which accompanied the example busts.

    If we want to resist the powerful forces marshalled to defend the status quo, I think that we will need to do better than this.

  2. The video sums up the problem of emissions legislation as widely discussed succinctly: All these schemes just legitimse emissions, and do nothing to actually reduce emissions. As well as providing a wealth redistribution mechanism that makes the householder the loser.

    In New Zealand we have the forsighted enough to have the RMA, which (despite the RMA not being great legislation) could be used to actually require the reduction of emissions, with no taxation-type impact to the householder, but it’ll never happen – too many vested interests…

  3. It is these type of concerns – particularly who the real beneficiaries of the C&T system – which fuels the arguments by climate change deniers that climate change is just a big scam by governments and industry. (hope this isn’t off topic :>))

  4. It is well and good to highlight the pitfalls of cap and trade, or whatever version is concocted, but any instrument devised would also be fallible.

    The proplem here is not so much the instrument, but the vulnerability of governments to be captured by vested interests. As for the scams – let the buyer beware – same as any purchase. There is a strong incentives for firms to verfy environmental credentials, to the point where it is better to avoid possible risk of greenwash than be exposed for greenwash – aka NZ Inc.

    Climate policy exposes the many flaws in our political and economic systems. I agree with Annie that the problem will not be solved by the thinking and thinkers that created it. But there is a long hard fight ahead to cange all this, and we must have some interim measures in place.

  5. dougH,

    tks for that.. dated last Saturday as I recall.. and surfacing the ‘climate debt’ countries – ie developed economies owe compensation to yet-to-emerge nations and/or those suppressing GHG emissions from development or activities..

    you’ll realise how the Brit PM Brown announcement of a large fund $10-12bn (?) responded.. and further progress ensued..

  6. As you can see from my recent blogging on this topic the figure of zero-point-two percent CO2 as NZ’s ‘share’ of global outputs is cited. Is this accurate..?

    Mebbe coincidental but your figure of 27mn tonnes for this forest proposal ties quite closely to the above percentage, if true

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