On 9/6/07, Gar Lipow <[EMAIL PROTECTED]> wrote: > of him that in his old age he would reject capitalism. But auctioned > permits are not like offsets. Really they are more like a carbon tax. > You have a certain number of permits with a limited lifespan, issued > in shrinking numbers each year. They are purchased at auction for the > the extraction or importation of fossil fuels, or alternatively when > they are refined or processed.
Why not use plain old carbon taxes then? Easiest thing in the world to simply impose a tax on gasoline and other petroleum products, and then perhaps use a mileage-based tax refund to avoid the regressivity. The problem with the auctions is it is almost guaranteed they will be fixed. Especially if it is "upstream" where all refineries are operated by a small number of oil majors. There is in fact a precedent for this sort of thing. The FCC regularly auctions wireless spectrum and the big telephone companies have learned to dominate the process completely and use it to keep unwanted outsiders away. The ongoing drama over the 700 MHz band shows clearly what to expect from such an auction process: http://ap.google.com/article/ALeqM5iMi936evStc1ZaVhT25j_gMSBXxg In fact the companies have a fiduciary responsibility to their shareholders to fix the auction. It is not the details that are flawed, it is the very idea that individual greed can somehow be harnessed to enhance the common good. It simply cannot be done. -raghu.
