Carbon trading is not about the climateRichard Treadgold | January 17, 2010
Once upon a time, people thought they would stop global warming, caused by carbon dioxide, by extinguishing their fossil-fuelled fires. But everybody loved their fossil fires and depended on them for every good thing in modern life. So they didn’t want to give them up. What would be the best way to persuade the people to extinguish the lovely fires?
Tax or ETS
The people decided that they just had to make the lovely fires more expensive and invent other ways of providing every good thing in modern life. That gave them two options to choose between: let the government put an extra tax on the fossil fuels, or create licences to emit carbon dioxide and let everybody trade them with each other. That was called an Emissions Trading Scheme (ETS), sometimes “cap and trade”.
Either scheme would have the effect of making the lovely fires more expensive because the cost of the tax or the emission certificates would be added to the price of the goods and services. Naturally, the people would end up paying more, but that was the whole point. All the good things in modern life were destroying the planet so they had to become too expensive to buy and the leaders said that was a sacrifice they were willing to make.
ETS promoted by Enron
The tax idea was popular among people who were genuinely concerned about society and the state of the planet. The ETS concept wasn’t very popular at first except among some way-out entrepreneurs, until a few big businesses unexpectedly supported it, starting with Enron, a famous US natural gas company you might have heard of which has since closed down.
In recent years, more and more support has been given to an ETS and “carbon” exchanges have been set up around the world to trade in carbon emission certificates. Most recently, the banks have expressed tremendous interest, which tells us there’s serious money involved and that some kind of trading system is now inevitable. Nobody can stop it.
It also tells us that carbon trading is not about the climate. Don’t let anyone tell you that it is. It’s about making money, not altering the weather.
Carbon trading is such a complicated aspect of the “global warming” wonderland that it cannot be described in just one article (nor probably even in one book). I want to explore carbon trading over the next few weeks or months. I have no agenda here, no list of topics to cover, just an interest in exposing the ETS scam for what it is — a way to make money for nothing and independent of climate change. If you have a contribution to make to this exposition, please email me at richard (at) wordshine.co.nz. I’d love to see articles with a New Zealand flavour, but your comments and questions are welcome.
I guarantee to put the most ardent environmentalist off the idea of using an ETS to “fix” global warming because it’s so risky for our economic and social health (apart from being grossly unfair and based on a non-existent problem). Here’s a good summary of some of the problems with carbon trading from Ross Clark, writing in The Express.