The cap-and-trade bill passed the House of Representatives shrouded in a fog of willful ignorance and calculated irrationality.
No one could be sure what he was voting for — not after the 1,200-page bill had a 300-page amendment added at 3:09 a.m. the day of its passage. The bill is so complex and jerry-built that even its supporters can't know how, or if, it will work. And it's metaphysically impossible for someone to know whether the motivating crisis, impending planetary doom, will ever materialize.
Other than that, it's a model exercise in thoughtful lawmaking.
The formulation of the so-called Waxman-Markey bill was less traditional legislative sausage-making than an unspeakable practice out of "The Jungle." Its architects bought off every possible interest group no matter what the policy consequences until they had a bare majority to slam it through the House sight unseen (a physical copy of the final bill didn't yet exist when it passed). Mission accomplished, although at the price of a ramshackle bill that won't succeed on its own terms, even as it introduces costly distortions and invasive bureaucratic controls into the economy.
The basic idea of cap-and-trade is that government establishes an economywide cap on carbon emissions and then creates emission credits, which companies can buy or sell among themselves. It is essentially carbon rationing designed to suppress traditional sources of energy.
Because cap-and-trade is meant to create pain in an economy dependent on fossil fuels for 85 percent of its energy, the only way to make it politically salable is to vitiate it. Originally, the Obama administration counted on $80 billion a year from the government's sale of emissions credits. To win over industry, Waxman-Markey gives the credits away for free. Poof! There goes the revenue.
The bill bestows hundreds of billions' worth of credits on local electricity and natural-gas distribution companies, as well as on the auto, coal and oil industries — basically anyone with the ear of a congressman or with a halfway competent lobbyist.
Then there are the "offsets," the environmental equivalent of indulgences. A company maintains its carbon emissions but buys an offset for someone else to capture carbon or reduce emissions — say, by not cutting down a tree in a rain forest somewhere. Offsets are notoriously dubious. Waxman-Markey makes generous allowance for them anyway.
The upshot is that an Environmental Protection Agency analysis says that under Waxman-Markey, there will be no reduction in emissions by 2020. The progressive Breakthrough Institute estimates that emissions could continue at their current business-as-usual rate through 2030. Perversities abound. According to the Los Angeles Times, under the bill, the U.S. "would use more carbon-dioxide heavy coal in 2020 than it did in 2005." Time magazine writes that "the total amount of renewable energy generation under Waxman-Markey would actually be less than the renewable energy that would have been produced without the bill."
Isn't saving the planet grand? Waxman-Markey creates an irresistible incentive for industry to repeat the games-playing of recent weeks, as it maneuvers for advantage in Washington and works to push the legislation's restrictions always off into the indefinite future.
Even if Waxman-Markey were perfectly formulated, it would reduce global surface temperatures by only one-tenth of 1 degree Celsius in 100 years. That's a negligible difference, purchased at a great price. The watered-down version is still so threatening to energy-intensive industries that it mandates tariffs on goods from countries that refuse to hamstring themselves so foolishly.
Democrats resorted to any expedient to pass Waxman-Markey as a long-term play: get the bureaucratic structure in place, then work through regulators, the courts and legislation to tighten the screws later. For them, that's the ultimate promise of the Offsets Integrity Advisory Board, the Carbon Market Oversight Interagency Working Group, the International Reserve Allowance Program and all the rest of the vast regulatory machinery engendered by the bill.
President Barack Obama called it an "extraordinary first step." Extraordinary, indeed.
