The Republican Caucus at Harvard Kennedy School
by Josh Archambault on October 19, 2009 in Dems v. Reps, Opinion
Policy debates often involve trade-offs, where citizens make sacrifices for the betterment of the broader society. Very few, however, would sign onto a deal that increased taxes and ultimately made the country worse off than it previously had been. Unfortunately, that is exactly what is being proposed in the cap and trade legislation currently being discussed in Congress.
Given the prevailing view that global warming is a serious problem, in which rising global temperatures could cause significant future losses for people throughout the world, what should the U.S. government do to address it?
The answer from Congressional Democrats and President Obama has been to propose a massive cap and trade bill to control all greenhouse gas emissions from major polluters in the U.S. While at first glance, this may seem like a reasonable solution, it is littered with problems.
First, there is a lack of accountability with the funds generated by the program. Cap and trade creates an artificial program whereby emitters have to pay the government for permits to emit greenhouse gases. This permit system promises to be expansive, potentially costing hundreds of billions of dollars every year. Not only do politicians frequently enjoy giving away free permits to industries that lobby them more heavily, including utilities and oil and gas companies, but the money raised from the permits would likely go to legislators’ pet projects and special interests. This is in contrast to what would perhaps be a better solution, in which the government would provide every citizen with a “green spending account” from the funds collected by carbon permit auctions, to be spent on energy-efficient improvements and renewable energy purchases. It is clear that from an engineering perspective, targeted investment at the point of consumption by individuals would result in greater efficiency, and ultimately, a greater reduction in carbon emissions per dollar spent compared with government spending on the supply side. The big-government Obama-era philosophy would likely never embrace such responsibility being given to ordinary Americans.
Second, the cap and trade legislation breaks President Obama’s pledge not to raise taxes on the middle class. Perhaps he meant to exempt middle class Americans who do not use any electricity or gasoline? If this legislation passes, gas prices will rise, along with the cost of electricity and the cost of goods that Americans purchase every day.
Third, we must recognize that we live in a global economy. If we raise the cost of production through greenhouse gas emissions caps, those emissions-intensive industries are likely to move elsewhere. Highly regulated, efficient industries in the US would be prone to move to poorly regulated, heavily polluting, inefficient areas in the developing world. In addition to shipping American jobs overseas, this would actually increase net emissions.
Finally, and most importantly, an analysis of the Waxman –Markey bill released by the EPA actually shows that there will be less renewable energy built under a cap and trade system than if business stays as usual. This is due to excessive energy conservation, which greatly reduces demand for electricity (including renewable electricity). It would be a poor message to send to renewable energy startups that the government is actually playing a role in reducing the amount of renewable energy built in the US. The net result of cap and trade, despite forcing Americans to pour hundreds of billions more into their energy costs, would be to bankrupt energy companies and reduce the amount of renewable energy built. But at least the government would be flush with cash…
A common sense framework for combating climate change would likely include programs or initiatives more along the lines of a low, but transparent greenhouse gas tax, greater tax incentives for renewable energy companies, increased investment in research and development for renewable energy strategies, and policies that keep energy prices stable for all Americans. Bloating government coffers by charging high permit fees to job-creating American companies stifles the innovation that is demanded, within our market system, to responsibly address the issue. We can and should do better.
HKS Republicans Ask YOU to Lend a Hand
by Josh Archambault on December 10, 2008 in Features
This winter, the HKS Republican Caucus has partnered with the Student Public Service Collaborative (SPSC) to help relieve food and clothing shortages at local shelters and social service agencies in the Cambridge-Boston area. Read more
2012: The Hunt Is On
by Josh Archambault on November 20, 2008 in Opinion
While the GOP licks the wounds from its November 4 pounding, the Republican punditry has already begun discussing what went wrong and how to fix it. You will soon hear from all three legs of the Republican Party stool - social conservatives, fiscal conservatives, and national security/foreign policy “hawks” - arguing that the party needs to drift back towards its strengths to win in the future. Deliberations in Republican groups will quickly turn to the presidential race in 2012, and who will lead the Party out of the desert.
Below is a short list (in no particular order) of some of the names already being tossed around in Republican circles. Read more
