Response to Questions Posed by Senators Domenici and Bingaman in "Design Elements of a Mandatory Market-Based Greenhouse Ga

Response to Questions Posed by Senators Domenici and Bingaman in "Design Elements of a Mandatory Market-Based Greenhouse Ga

March 12, 2006

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See also: Response to Domenici-Bingaman White Paper by Myron Ebell, with additional comments by FreedomWorks, the American Legislative Exchange Council, and the Free Enterprise Action Fund

Science does not justify climate alarmism, and the costs of any mandatory carbon-reduction policy are likely to be out of all proportion to their putative benefits. The White Paper should but does not invite discussion of these threshold issues. The Committee has not yet heard the case against climate alarmism from qualified scientists even though Chairman Domenici promised to hold such a hearing in his opening statement of July 21, 2005. Issuing the White Paper before the Committee has conducted a balanced assessment of climate science was premature—a rush to judgment unworthy of the world’s greatest deliberative body.

All mandatory carbon suppression schemes are contrary to the public interest, but cap-and-trade strategies have the greatest potential for political mischief and economic harm. A regime of carbon retail sale taxes would be administratively simpler, more transparent, and more accountable than a cap-and-trade program. Citizens would feel the bite the tax takes out of their wallets each time they purchased gasoline, paid an electric or natural gas bill, or bought a product manufactured with heat or steam from fossil fuels. Consequently, they would be more likely to demand that policymakers explain why the ostensible benefits of carbon taxes justify their costs—and more likely to resist attempts to increase such taxes—than they would to demand a justification for carbon caps or to resist attempts to tighten the caps. In addition, since taxes are a domestic policy matter, they are easier to repeal than policies, such as cap-and-trade, that are likely to become entangled in the policies of the European Union and the Kyoto negotiating process.