Virginia Postrel voices the same frustration any honest economist feels witnessing the current state of accepted opinion on energy policy:
It’s infuriating how all three presidential candidates prattle on about the need to fight global warming while also complaining about the high price of gasoline. The candidates treat CO2 emissions as a social issue like gay marriage, with no economic ramifications. In the real world, barring a massive buildup of nuclear plants, reducing carbon dioxide emissions means consuming less energy and that means raising prices a lot, either directly with a tax or indirectly with a cap-and-trade permitting system.
This should be common sense, but environmentalists still believe they can pull a fast one on the American public by including just the right amount of rebates and incentives in legislation to make a cap-and-trade system appear cost free. The latest study from MIT analyzes these scams under the most generous possible assumptions and still finds:
- The price of gas increases by 42 percent by 2020.
- The price of electricity increases by 55 percent by 2015.
- Total economic output as measured by GDP drops by about 1 percent by 2035.
And this is assuming a U.S. cap-and-trade system would allow for at least 15 percent of carbon offsets to be bought from overseas. The inability to properly verify these carbon reductions proved to be the Achilles heel of the European Union program, and it guarantees the system will fail.