NASA’s James Hansen on Cap-and-Trade


Hansen doesn’t think cap-and-trade will work, and supports a straight — and refundable — carbon tax:

A cap-and-trade system, under which progressively stricter “polluting right” exchanged in a carbon market, is likely to be reinforced at U.N. climate talks in Copenhagen this December as the favored approach to slashing greenhouse gases.

The system is already in practice in the European Union, and has been proposed by U.S. President Barack Obama for the United States.

But Hansen is highly sceptical that it can work.

“It takes about 10 years to negotiate it and get all the countries on board, and then you make all sort of compromises, so it turns to be very ineffectual,” he said.

“If it’s going to be cap and trade, I’d rather nothing came out of Copenhagen. I’d rather take another year and two and get it right.”

The fact that prices in the E.U. carbon market have plummeted due to the global economic crisis lends weight to Hansen’s doubts.

What would work, he argues, is a direct tax — as close to the source as possible — on fossil fuels. “A carbon tax is the mechanism that allows you to make an international agreement globally effective in a short period of time,” he said.

“You could start with the E.U., United States and China — that would be enough,” he added, saying other nations confronted with a carbon-tax on their exports would quickly follow suit.

To create strong “green” incentives, the levy should be given directly back to the public on a per capita basis — in the United States, he said, it would amount to several thousand dollars per household.

“A person with several large cars and a large house will have a tax greatly exceeding the dividend. A family reducing its carbon footprint to less than average will make money,” Hansen wrote in December in an open letter to then president-elect Obama and his wife Michelle.


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