Obama is wrong on the cap and trade auction system.

Reasons to agree:

1. Romney has said, "Governor Mark Sanford is right. Unfortunately, some in the Republican Party are embracing the radical environmental ideas of the liberal left. As governor, I found that thoughtful environmentalism need not be anti-growth and anti-jobs. But Kyoto-style sweeping mandates, imposed unilaterally in the United States, would kill jobs, depress growth and shift manufacturing to the dirtiest developing nations."
2. Its called global warming, but cap and trade only punishes the US, if China and India don't join. We should not put our businesses on an un-even playing field unless other countries go along.
3. Cap in trade does not work very well in Europe.
4. It would be better to directly invest in clean technology, instead of punishing old technology.
5. We should first do a cost benefit analysis of global warming, before we do anything harsh. Lets say we spend 5 trillion dollars every 10 years fighting global warming, but we only stop the planet from changing 1 100th of a degree. Is that success? What if it was 10 or 100 trillion dollars every 10 years? No one is even asking any of these questions. We are just going down the road blindly. Perhaps more lives could be saved with the trillions of dollars this will cost us, if we invested in other things. Who knows, if rising sea levels are the big problems, with that much money we could pump extra water to death valley, and bring some life to a lifeless area. There is still some aspect of the religious cult to the whole carbon-phobia phenomenon that wants to treat the earth like an environmental sanctuary instead of a garden.
6. Cap and trade would require a lot of regulation, new agencies, tons of overhead.
7. Emission taxes which they argue are a simple and economically efficient means of achieving the same objective. The fact that Obama approves of the cap and trade auction system shows that he is easily caught up in hype (as well as generating hype) and doesn't look at the facts.
8. Permit prices may be unstable and therefore unpredictable
9. Cap and trade systems tend to pass the quota rent to business
10. Cap and trade systems could become the basis for international trade in the quota rent resulting in very large transfers across frontiers
11. Cap and trade systems are seen to generate more corruption than a tax system
12. The administration and legal costs of cap and trade systems are higher than with a tax
13. A cap and trade system is seen to be impractical at level of individual household emissions

 

Reasons to disagree

1. We should use the markets to promote good behavior and punish bad behavior.
2. The transfer of wealth from polluters to non-polluters provides incentives for polluting firms to change.