Why Don't Republicans Champion Carbon Cap-and-Trade? It Was Their Idea

The year is 1989.

Environmental policy wonks in the new administration of George H.W. Bush - he was called just "George Bush" at that time, when his largely unknown son was pre-occupied with baseball - gather to map out a plan to do something about acid rain.

The wonks know that they need to get a handle on the problem. Politicians in the Northeast are up in arms. During the presidential campaign the year before, the boss had promised to be the "environmental president."

The wonks begin talking about a novel approach to cutting emissions of sulfur dioxide, an acid rain precursor. Instead of simply limiting emissions and then telling each emitter exactly how to meet those limits, why not put market forces to work? We're Republicans, right? Give the utilities carrots so it will pay for them to ratchet down their SO2 emissions, rather than just club them over the head with regulatory sticks, like the bureaucracy-happy Democrats like to do. President Reagan's people adopted this idea back in '85 to get the lead out of gasoline. We can borrow it and go one better. The boss will love it!

Here's what we'll do, Top Wonk says. We'll give the utilities emissions allowances, but the number of allowances will be capped and the cap will fall over time, so that we achieve real emissions reductions. How the utilities comply with the cap will be up to them. If a utility can find a way to reduce its emissions below its allowed level, it can keep the surplus allowances for later use, or sell them to other utilities and pocket the cash. For other utilities, it might be cheaper for them to buy those surplus allowances rather than install scrubbers.

It's win-win, Top Wonk argues. We set a standard. We let utility guys who know their business better than federal bureaucrats figure out how to comply. We put a mechanism in place that provides an incentive to comply. Voila, we've created a market for reducing pollution. Emissions fall nationwide. And, we grab the green issue away from the Democrats by showing the country that Republican ideas for cleaning up the environment are better. What's not to like? A cheer goes up in the room.

Then, without warning, the air starts feeling prickly. Fingers of static electricity dance around the room. The wonks stare at the bizarre spectacle in amazement. One mutters that it feels like being in the middle of an Arnold Schwarzenegger movie. Suddenly, Top Wonk vanishes into thin air!

The other wonks are too stunned to say anything. Then, almost as quickly as he had vanished, Top Wonk re-appears.

Top Wonk's hair is flecked with grey and he looks heavier. His suit is disheveled, tie askew. He sits down, rubs his perspiring face, exhales loudly, and tells his fellow wonks to listen up. He has their undivided attention.

"You won't believe this, but I was transported 20 years into the future. I spent almost a year there, in the years 2009 and 2010. And, I have good news and bad news.

"First, the good news. The good news is that our emissions allowance plan will work! President Bush will champion it and Congress will pass it into law next year with thumping bipartisan majorities. I looked over EPA's reports from the future and they document a dramatic reduction in sulfur dioxide emissions, from about 16 million tons per year today to less than half that amount by the year 2008.

"Now, the bad news. The bad news is that many of our fellow Republicans in the future hate our idea.  Apparently, the Democrats saw how well it worked and embraced it. But instead of saying, 'I told you so,' the Republicans of the future are demonizing our idea. They call it a job killer. They ridicule it with this vacuous 'cap and tax' slogan.

"We won the policy debate, but future Republicans won't take yes for an answer. It's very perplexing. It's not that future Republicans want to go back to the old command-and-control paradigm. It's that they don't seem to want to do anything about the environment at all. They seem happy to let the Democrats monopolize the issue.

"They're forgetting everything that Republicans like Teddy Roosevelt, Dick Nixon, and Jerry Ford did to protect the environment. And, they talk out of both sides of their mouths about President Reagan - they claim to admire him, but then they babble these weird conspiracy theories that ozone depletion is a hoax. The Montreal Protocol to reduce ozone depleting chemicals entered into force on New Year's Day this year, and I'll bet that President Reagan would be really ticked off that his purported admirers are denouncing a treaty that he's very proud of!

"And get this. In the future, Arnold Schwarzenegger is the governor of California. No, really. And he's a Republican like us. He's doing all this great stuff to protect the environment, but the future Republicans are bad-mouthing him as a 'rhino,' which I guess is supposed to be an epithet for Republicans who don't parrot whatever dogma that is supposed to be the party line. I just don't get it"

Top Wonk said no more. He collapsed, exhausted, in his chair and immediately fell into a long sleep. The other wonks left the room, made a pact never to tell anyone what they had just seen and heard, and then returned to their work.