Our climate change debate engendered a lively conversation among readers that pushed the original essays well beyond their starting points. One side advocated a carbon tax (argued by Gregg Easterbrook), while the other side proposed a cap-and-trade plan (argued by Carter Bales and Rick Duke.) Community response provides a nuanced look at the issue, revealing far more facets than our starting points uncovered. In his defense of the carbon tax, for example, Easterbrook makes the case that a tax is simpler and less prone to gaming by lobbyists, legislators, and the market players. Many readers pushed back:

• “ . . those arguing that a tax is less likely to be gamed should read our current Byzantine tax code and note the very healthy industry that exists around both lobbying for tax credits and exemptions and then helping people get around the existing code through crazy schemes!” — RogersCQ Weed
• “Most proponents of the carbon tax understate the complexity involved in implementing it. The cap-and-trade bills are lengthy and complex because folks have thought long and hard about how to implement [them]. . . . Once proponents of a tax have addressed comprehensively these issues then they might have a basis to say that it’s simpler.” — Julian Turecek
• “Simpler is not always better. Simpler is better only when the same goal can be achieved and better results delivered. The first car in the world was not favored by people who were accustomed to [a] carriage simply hauled by horses. And few people understood the advantage of the world’s first computer . . . over the then easily used abacus.” — Vivi Lu

Bales and Duke argued that a cap-and-trade program provides greater price certainty, because long-term abatement levels would be known and the market would quickly price the cost of meeting them. Many readers were skeptical:

• “Putting a price on carbon is useless if future carbon prices are uncertain and/or extremely volatile. Unless there is certainty about future carbon prices, critical private-sector investments in low-carbon technologies will be delayed. Europe’s experience makes it abundantly clear that carbon markets will need decades to mature to a point where prices are relatively stable. A weak price signal is a useless price signal.” — William Pentland
• “ . . . the market for emission credits or investment projects that cancel emissions will fluctuate with both the level of overall economic performance and the creativity of entrepreneurs to identify viable alternatives.” — Jose Tormo
• “It does not make sense to pay for the costs of one externality, carbon emissions, by creating what amount to essentially another externality, the costs of administering and policing a cap-and-trade system.” — Tota Mukherjee

Readers also brought up points that weren’t part of the kick-off debate essays. For example, several readers pointed out that cap and trade was successfully used to reduce acid rain, but disagreed about whether it would work for carbon:

• “The US acid rain problem was solved using this mechanism and there is no reason why it wouldn’t work for CO2.” — Mondher Ben-Hamida
• “Reducing CO2 emissions is a problem several orders of magnitude bigger than reducing sulphur.” — Bernardo Neri
• “Previous C&T programs for other emissions worked due to a controlled technology being available to reduce the emissions and control costs. There is no viable control and sequestration technology for CO2.” — Steve Jackson

Others were doubtful that any plan could be effective that was not global:

• “Carbon is a global issue, and as such needs a coordinated global solution. To get 200 plus countries to agree to a common carbon tax that doesn’t change through the next 50 years will be impossible. As such a carbon tax doesn’t meet the need to address a global issue with global solution.” — Oscar J.
• “Cap and trade has worldwide support and the emissions problem is a worldwide one-so let’s create a US plan that uses market mechanisms acceptable worldwide and could be synched up with plans of other nations.” — Bill Nieman
• “A worldwide agreement (Copenhagen 2009) on which system to adopt will be far more effective than bickering over the “ideal” system.” — Chris Vansnick
• “ . . . if the OECD has CO2 costs and China does not, then CO2 regs are just a massive wealth transfer to China. More importantly it will lead to higher CO2 emissions globally as they just shift production from relatively more efficient OECD plants to less efficient Chinese facilities. The argument that the US needs to lead on GHG regs and then the rest of the world will follow is naïve.” — David Gee

The debate was, of course, tempered by today’s economic climate as readers raised the issue of staying competitive in a time of economic strain and evaluated how the alternatives might contribute to innovation in a post-crises economy:

• “The pure attraction of a cap is that it sets a target against which emissions performance can be measured and reported annually, and policy settings adjusted, in order to manage down the cap year on year. . . . this will facilitate more coordinated action by business and use the beneficial power of the markets to drive innovation and reward achievement.” — Bill Royce
• “Cap and trade gives positive incentives for innovation, taxation gives incentives to minimize taxation liability, not the most effective way to stimulate positive behaviour.” — Terrance Barkan
• “Both systems will encourage innovation as both place cost on emissions. A flat tax ensures as far as possible that innovation will be systems based or research based, and not merely sleight of hand.” — Richard
• “The carbon tax is an old world, domestic approach to addressing a new world, global problem. Innovation is in order, along with gradually increasing limits on GHG emmissions. Cap and trade gives corporations flexibility in the way they deal with imposed limits, while creating new revenue streams [for] those who aggressively innovate.” — Doug Hoover

Finally, a significant number of respondents disputed the notion that climate change was a problem requiring a major policy fix.

• “This world has real problems-nuclear armed North Korea, economic recessions, hunger, crazy terrorists, Vladimir Putin, etc.; let’s not make up problems we don’t have or we can have little impact on.” — John Passyn
• “It doesn’t matter what you call it, it’s a tax. When Louisiana decided to implement a lottery, my late brother-in-law likened it to paying your “stupid” tax. When you’re worried about global warming after we just saw a record low temperature of -50F in Vermont, I’d say that’s a pretty good name for it.” — David Sims
• “I am amazed at how easily the leadership of this country has given up on the science and is now focusing on costly policy making without a sound basis. The science debate has not been settled. Our climate models have large errors and cannot yet be used as forecasting tools. More work is still required. I refuse to vote on carbon tax or cap and trade at this time. We are not there yet.” — Balvy Bhogal-Mitro
• “Climate change has clearly become a political issue, not a scientific one. Never mind the degree of climate change, or even if man is the cause of climate change, we burden our economy with ever greater penalties in pursuit of a poorly understood objective without regard for the cost.” — Paul Kleinen

Clearly there is no consensus around either market-based solution as the landscape continues to shift with the economy. What do you think?

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