Tuesday, May 22, 2018
Opinion

California's experiment on climate change

Starting on Jan. 1, California began the nation's most ambitious experiment yet in fighting climate change, and it did it more or less alone. For environmentalists depressed by years of unproductive "debate" in the United States on global warming, this moment is heady — and perilous.

Starting this year, the nation's largest state, the ninth-largest economy in the world, will put a price on the greenhouse gas emissions responsible for global warming. California has established a cap-and-trade program, a design similar to what Congress considered but failed to pass in 2010. Perhaps the Golden State in the new year will prove once and for all that markets can and should be marshaled in the fight against global warming.

Pricing carbon emissions is undoubtedly the right concept. California's cap-and-trade mechanism is supposed to minimize costs by establishing a statewide limit on total emissions and a market where businesses can buy the right to pollute a certain amount under that cap. When firms and their consumers must pay for their emissions, they find the cheapest ways to pollute less.

But California's experiment might not work well enough to persuade others to follow along. The most obvious problem with the plan is that it relies far too little on the market-based cap-and-trade system and far too much on other, expensive, command-and-control regulations. State officials expect to achieve only about 23 percent of their planned emissions reductions through 2020 with carbon pricing, and it's not clear what happens after that. The cost of the whole package, then, is likely to be higher than necessary.

Even if that were not the case, there are other potential problems that flow from the fact that California is acting alone. As with any market, the bigger a carbon market is, the more efficient it is. But the group of Western states that were going to join California in creating a linked carbon market have not followed through. That not only reduces the size of the market California is creating, it could also dull its effectiveness.

Affected companies could move out of state and pollute just as much as they would have before California imposed its program. Out-of-state electricity generators, meanwhile, might try to reshuffle where they send their product — cleaner stuff to California, dirtier stuff elsewhere — instead of lowering their total emissions. Ironically, these issues, called carbon "leakage," might make their own solution — a national carbon price — less attractive.

California's plan — cap-and-trade and other elements — also faces legal challenges, since its requirements affect interstate commerce, a policy domain the Constitution reserves for the federal government. Opponents claim that California is attempting to regulate businesses in other states and even to discriminate against out-of-state products. State officials express confidence that they will win the legal argument, but that, too, is not assured.

In its final preparations for Tuesday's launch, California held an auction in December for 2013 carbon pollution rights. The rights sold at only a few cents above their legally mandated minimum price.

Simply establishing a carbon price is a very large step; from here, policymakers can streamline the policy and attract other states into finally linking up with California. Perhaps — if it survives the courts, and the court of public opinion.

Comments
Editorial: Tampa Bay House members fail to stand up to Big Sugar

Editorial: Tampa Bay House members fail to stand up to Big Sugar

Big Sugar remains king in Florida. Just three of the state’s 27 House members voted for an amendment to the farm bill late Thursday that would have started unwinding the needless government supports for sugar that gouge taxpayers. Predictably, the am...
Published: 05/18/18
Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Florida Attorney General Pam Bondi’s lawsuit against the nation’s largest drug makers and distributors marks a moment of awakening in the state’s battle to recover from the opioid crisis. In blunt, forceful language, Bondi accuses these companies of ...
Published: 05/18/18
Editorial: A sweet note for the Florida Orchestra’s violin program for at-risk kids

Editorial: A sweet note for the Florida Orchestra’s violin program for at-risk kids

This is music to the ears. Members of the Florida Orchestra will introduce at-risk students to the violin this summer at some Hillsborough recreation centers. For free.An $80,000 grant to the University Area Community Development Corp. will pay for s...
Published: 05/17/18
Updated: 05/18/18
Trump backs off China tariff threat as China pumps money into a Trump family project

Trump backs off China tariff threat as China pumps money into a Trump family project

In barely six weeks, President Donald Trump has gone from threatening to impose $150 billion in tariffs on Chinese goods to extending a lifeline to ZTE, a Chinese cell phone company that violated U.S. sanctions by doing business with Iran and North K...
Published: 05/17/18
Editorial: Activism as seniors helps put Hillsborough graduates on the right path

Editorial: Activism as seniors helps put Hillsborough graduates on the right path

Lots of teenagers are walking together this week in Hillsborough County, a practice they’ve grown accustomed to during this remarkable school year.We can only hope they keep walking for the rest of their lives.Tens of thousands of them this week are ...
Published: 05/17/18
Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Editorial: Bondi holds drug industry accountable for Florida opioid crisis

Florida Attorney General Pam Bondi’s lawsuit against the nation’s largest drug makers and distributors marks a moment of awakening in the state’s battle to recover from the opioid crisis. In blunt, forceful language, Bondi accuses these companies of ...
Published: 05/16/18
Updated: 05/18/18
Editorial: Johns Hopkins All Children’s should be more open about mistakes

Editorial: Johns Hopkins All Children’s should be more open about mistakes

A state investigation raises even more concern about medical errors at Johns Hopkins All Children’s Hospital and the venerable St. Petersburg institution’s lack of candor to the community. Regulators have determined the hospital broke Florida law by ...
Published: 05/16/18
Updated: 05/17/18
Editorial: St. Petersburg recycling worth the effort despite cost issues

Editorial: St. Petersburg recycling worth the effort despite cost issues

St. Petersburg’s 3-year-old recycling program has reached an undesirable tipping point, with operating costs exceeding the income from selling the recyclable materials. The shift is driven by falling commodity prices and new policies in China that cu...
Published: 05/15/18
Updated: 05/18/18
Editorial: HUD’s flawed plan to raise rents on poor people

Editorial: HUD’s flawed plan to raise rents on poor people

Housing Secretary Ben Carson has a surefire way to reduce the waiting lists for public housing: Charge more to people who already live there. Hitting a family living in poverty with rent increases of $100 or more a month would force more people onto ...
Published: 05/15/18
Updated: 05/18/18
Editorial: Voters should decide whether legal sports betting comes to Florida

Editorial: Voters should decide whether legal sports betting comes to Florida

It’s a safe bet Florida will get caught up in the frenzy to legalize wagering on sports following the U.S. Supreme Court opinion this week that lifted a federal ban. Struggling horse and dog tracks would love a new line of business, and state l...
Published: 05/15/18
Updated: 05/16/18