Comparing Theory To Reality

Ezra Klein relating some testimony from a Brookings expert:
"From Brookings Institution expert Ted Gayer-
'I acknowledge that my arguments in favor of a carbon tax over cap-and-trade are made easier in that I am comparing my ideal hypothetical carbon tax to the actual cap-and- trade programs either passed by the House or proposed in the Senate. Indeed, a cap-and-trade program that included a safety valve and that auctioned allowances would achieve many of the economic advantages of a carbon tax.

The most frequent criticism of a carbon tax is that it would be politically unpopular. But to quote Milton Friedman, I think my role is to “prescribe what should be done in light of what can be done, politics aside, and not to predict what is ‘politically feasible’ and then to recommend it.” You, of course, have the more difficult task of determining what is politically feasible. But given the magnitudes of the costs and benefits associated with any climate policy, I recommend to you a careful consideration of the merits of a carbon tax.'

That's Brookings' Ted Gayer testifying before Congress on the merits of a carbon tax. Gayer is having this argument with the right people: Legislators who might not support a carbon tax, but should. Right now, a compromised cap-and-trade plan is more politically feasible, but that would of course change if congressmen stopped being terrible about this and threw in behind the policy that makes the most sense"
http://voices.washingtonpost.com/ezra-klein/2009/12/the_right_argument_for_a_carbo.html
TW: Both Gayer and Klein are progressives, as am I as u might have noticed. We all support a carbon tax over cap and trade. It is not that cap and trade is bad, it is that a carbon tax is more elegant and most importantly easier to understand. And to be clear, the single biggest complaint about the current cap and trade legislation is that it gives away the initial credits rather than sells them. Why is this? Bi-partisan opposition in coal states to any legislation that actually penalizes high carbon emissions. This dynamic would result in tax credits being provided to those same producers in a carbon tax regime.

But cap and trade is on the board, a carbon tax despite the occasional conservative think tank support remains theory only. As mentioned yesterday, if there was an opposition party interested in actual governing rather than single-minded opposition we might get a carbon tax.