The Invisible Hand of Eco-nomics

Cap and trade is going nowhere at the federal level but the California program is large and expanding and the CA program allows for properly monitored and regulated offsets to be purchased from anywhere in the United States. As a result, a price on carbon is being established nationally.  As the NYTimes indicates in a very good article, once a market and a price have been established, contentious politics turns into mutually beneficial economics.

Experts who support cap and trade contend that a market mechanism can reach more deeply into the economy than any other approach, changing the behavior even of people and companies that might not necessarily care about global warming.

The Wisconsin dairymen perhaps serve as an example of that.

Even as the methane-powered generator roared on his property, John T. Pagel said he was not convinced that the climatic changes happening in the United States were a result of human emissions. He suspects they might be part of a natural cycle. But with Californians dangling cash in exchange for his willingness to cut emissions, he jumped at the chance to build his digester.

“We are doing exactly what they asked us to do to get paid to reduce carbon,” Mr. Pagel said. “If somebody else believes in it enough to put up the money, that’s all I need to know.”