Clarifying Terms

Tuesday, June 03, 2008

Not too long ago, I recalled that I'd come up with a better way to speak of "cap and trade" schemes and why I liked the idea:

I have occasionally referred here to the "carbon credits" pushed by global warming alarmists as "fuel rations", thinking that if that proper name ever caught on, many would have a better chance of seeing the true nature of such silliness as "cap and trade" schemes, and reject them.
Clever, if I say so myself.

But what makes this clever, and what could make it backfire? What makes it clever is the very thing that jogged my memory about the term in the first place: The fact that politicians are now openly speaking of fuel rationing in Britain.

Americans may be blindly swaying to the music of the Global Warming Chorus, but they're not so far-gone overall that they'd stand for the government openly rationing commonly-available life necessities. The term "rationing" would help many implicitly-individualistic Americans notice that the global warming alarmists are trying to enact a collectivist measure. Some might even become suspicious of that whole agenda as collectivist.

This would be a good way to move the debate from where it is ("How does the government make us cut back on carbon emissions?") to where it ought to be ("Should the government be dictating what fuels we use at all?"). It is, however, no substitute for continuing to work for a more widespread understanding of what freedom is and what its (closely related) importance and intellectual underpinnings are.

As a case in point, which also illustrates the hazards of ineffectively clarifying such terms as "cap and trade", let's look at an article featured today at RealClear Politics. It seems to be after the same angle as I, but it fails both to re-frame the argument properly and to put forth principled arguments as to why fuel rationing is wrong. Its title is arresting enough: "Just Call It 'Cap and Tax'".

And beyond that, the article does at least challenge the idea of selling fuel rations as "free market" and it does a good job of outlining some of the consequences of imposing it. To wit:
... If we suppress emissions, we also suppress today's energy sources, and because the economy needs energy, we suppress the economy. The models magically assume smooth transitions. If coal is reduced, then conservation or non-fossil-fuel sources will take its place. But in the real world, if coal-fired power plants are canceled (as many were last year), wind or nuclear won't automatically substitute. If the supply of electricity doesn't keep pace with demand, brownouts or blackouts will result. The models don't predict real-world consequences. Of course, they didn't forecast $135-a-barrel oil.

As emission cuts deepened, the danger of disruptions would mount. Population increases alone raise energy demand. From 2006 to 2030, ... [t]he Congressional Budget Office has estimated that a 15 percent cut of emissions would raise average household energy costs by almost $1,300.

That's how cap-and-trade would tax most Americans. As "allowances" became scarcer, their price would rise, and the extra cost would be passed along to customers. Meanwhile, government would expand enormously. It could sell the allowances and spend the proceeds; or it could give them away, providing a windfall to recipients. The Senate proposal does both to the tune of about $1 trillion from 2012 to 2018. Beneficiaries would include farmers, Indian tribes, new technology companies, utilities and states. Call this "environmental pork," and it would just be a start. The program's potential to confer subsidies and preferential treatment would stimulate a lobbying frenzy. Think today's farm programs -- and multiply by 10. [bold added]
This is well and good. We should be afraid of fuel rationing! Indeed, calling it "cap and tax" isn't strong enough:
[I]f we're going to try to stimulate new technologies through price, let's do it honestly. A straightforward tax on carbon would favor alternative fuels and conservation just as much as cap-and-trade, but without the rigid emission limits. A tax is more visible and understandable. If environmentalists still prefer an allowance system, let's call it by its proper name: cap-and-tax.
This last paragraph concedes the moral premise of the environmentalists by failing to challenge the propriety of government taxation or market interference, while objecting only to how this scheme is being sold. This implicit acceptance of government taxation and economic meddling as a good and normal part of life incidentally also takes all the punch out of the phrase "cap-and-tax". But the phrase lacked some punch to begin with because too many people are too comfortable with the government taxing them to death already.

In other words, this column ends up being basically a "noble goal but ignoble means" type of non-argument that will ultimately lose the day.

One does not fight for freedom by allowing one fraction of an inch of the moral high ground to its enemies. The government taking our money and the government issuing orders to anyone other than a criminal or a foreign enemy are morally wrong and violate individual rights.

"Cap-and-tax" is just as wrong as "fuel rations". But Americans will become morally indignant only about the latter, and this is why the latter is a better place from which to start fighting back.

-- CAV

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