Carbon credits are based on a flawed global warming theory and will cripple the economy.  The cap and trade tax essentially charges companies that cause carbon dioxide to be disbursed into the atmosphere.  The theory is that this will provide a disincentive to do so.  With the theory of global warming being caused by man-made fossil fuels having been debunked by scientists, this tax is ludicrous.

Populations Most Affected by the Cap and Trade Tax

In developing countries the large populations and substandard average living conditions encourage higher CO2 outputs.  In western culture we may find this concerning, but these poor regions will not stop emitting CO2 because doing so would keep their people poor.  Some oil companies have said if there continues to be a push to tax these activities, they will simply move their operations to nations that do not enforce them to avoid the tax.  These costs will be passed on to US consumers.

The Effect on the Economy

Because you and I will be paying the costs as a net economic effect, we will still be poorer.  Energy and oil costs will continue to rise making it more difficult for lower income families to pay.  Food costs will also rise as gas and oil prices increase making it more difficult to transport products.  It would make more sense to focus on how these environmental changes affect the population and then spend money towards environmental control and response.  Modified farming could also be encouraged to offset and climactic conditions.

Privatization of the Atmosphere

These emissions taxes essentially charge companies per ton of carbon emissions they emit.   This in actuality creates a privatization of the atmosphere.  By offsetting carbon credits, companies can invest in emissions reduction programs in developing countries and use these tax credits to offset their more costly emission reductions.  In this scenario, the only winners are the heavy polluters while the losers tend to be poorly developed countries.  In my mind this makes this more an issue of morals rather than environmental values.

The Argument for Carbon Tax Credits

By providing poor countries with the option of carbon credits, economists argue that governments who create a large global market would make their populations take advantage of the carbon’s value.  The World Bank has currently offered several million dollars to countries to encourage them to take part in the carbon tax credit program, despite the fact that there is no agreement on a global emissions trading market.  There are also no universal laws regarding the distribution of carbon tax credit certificates.

By levying a penalty on businesses and consumers who emit carbons we are creating an unequal system.  Without a global standard of technology, there is no way to reduce greenhouse gas emissions efficiently.  The levy would need to be high enough to encourage the behavior to be changed rather than just offsetting it onto developing countries.  There should also be a better understanding of where the money is going and what it is being used for, before implementing a cap and trade tax.