Carbon Tax Winning New Converts. By Eleanor Clift, Newsweek, December 11, 2009. "As world leaders gather in Copenhagen to pursue a reasonable set of targets to cap greenhouse gases, there is a growing realization in Washington that the Senate bill designed to address climate change is doomed... At the same time, there is a new sense of urgency that action must be taken to address what the weight of scientific evidence suggests is a deadly warming caused by human greenhouse-gas emissions, primarily carbon. The legislation currently before the Senate would cap overall carbon output and allow various business interests to trade permits to pollute like so many shares of stock. Wall Street loves cap-and-trade because permits could be securitized just like credit-default-swap schemes, but few others are wild about it, or even understand how it works, and it seems too heavy a lift for Senate Democrats facing reelection. Against this backdrop, another idea is gaining momentum, one that seems even more improbable: a carbon tax. Its proponents call it 'Plan B,' and it is predicated on the anticipated failure of cap-and-trade, along with a determination to press ahead and not let the naysayers win. Pushing a tax in the middle of an economic downturn seems counterintuitive, but... Elaine Kamarck, a former Gore adviser and co-chair of the Climate Task Force, which is promoting the tax, says her side decided it might as well tackle the issue head-on.
"Kamarck and economist Rob Shapiro, another refugee from the Al Gore era, have gone back to the future to resurrect the idea of a carbon tax, which the former vice president wrote about in the last chapter of his seminal 1992 book, Earth in the Balance. The reason they think it's time has come has a lot to do with the economic meltdown that began in 2008, and the resulting distrust of Wall Street and its complex trading systems. Kamarck's 'aha' moment occurred this summer in a focus group examining voter perceptions of a carbon tax versus cap-and-trade, when a woman exclaimed, 'You mean we're supposed to trust the fate of the planet to the people on Wall Street?!' The Hart Research poll that followed bore out the woman's reaction: it found that voters prefer a carbon tax to cap-and-trade by a 2-to-1 margin, which convinced Kamarck and her compatriots that the zeitgeist had changed." It's Time for Plan B. By Robert J. Shapiro & Elaine C. Kamarck, Politico, December 9, 2009.
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