Dr. Robert I. Bell proposes that instead of Cap & Trade or taxing carbon, governments instead reward investment in renewable energy by removing taxes that penalize investors.
Although millions of persons obviously are aware of the magnitude of the climate crisis, no one seems to know how to get out of it. The current public discussion focuses on reducing the consumption of carbon. Entire UN conferences are held on it; international treaties, which are then either not ratified or ignored (or both) come out of these conferences. Wall Street financial companies set up markets to trade certificates to raise the price of carbon; and they don’t work, the price of carbon keeps falling, thereby encouraging its use. Why don’t these systems work?
They focus on a negative, reducing carbon consumption, and set extremely difficult objectives from a political standpoint—taxing existing activities, by imposing a carbon tax or a complex and essentially opaque cap and trade system. Cap and trade is simply open to too many abuses—including issuing too many permits from the get-go (often giving them away). It also has a conceptual mismatch which is a killer. Trading is inherently short term, buying and selling in fractions of a second, but global warming is ponderously long term, as it settles in over decades. The few cap and trade systems to deal with global warming which have been tried have been embarrassingly ineffective. Carbon taxes, so far, have been politically impossible; no significant carbon tax exists—nearly every political leader who proposes or institutes one either backs off or gets defeated in the following election. The evidence for the failure of these approaches is clear and compelling.
Both cap and trade and carbon taxes punish what we don’t want—carbon.
These systems have failed because the emphasis has been on the problem, carbon, and not on the solution—another source of energy. Roughly 80% of final energy consumption is now produced by fossil fuel. To replace it by nuclear (currently just under 3% of final energy consumption) would require, worldwide, increasing the existing 434 reactors by a factor of 30—to some 13,000 reactors! Considering problems of terrorism, and events such as Fukushima and Chernobyl, the nuclear path clearly could be as challenging, if not more so, than global warming itself. Shale gas, even if it were economically viable, which it certainly is not, even in the U.S.1, still produces carbon. By default, all emphasis should be put on driving massive investment in renewable energy.
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