Cap and Trade: Unlikely to Cut Global Emissions

Cap Trade The U.S. House of Representatives has passed a bill to establish a cap-and-trade system to limit greenhouse gas emissions in support of Obama administration environmental policy objectives. A clear majority of policy survey respondents (56 percent) think that cap and trade would reduce U.S. greenhouse gas emissions but would increase global emissions by shifting economic activity to countries with less stringent emissions controls. A significant minority (38 percent) say that cap and trade would not even be successful in reducing U.S. emissions. Only 15 percent of respondents believe that cap and trade would help achieve a significant reduction in global greenhouse gas emissions.

Although the survey panel is very pessimistic about a cap-and-trade system’s ability to cut emissions, it is less pessimistic about the impact of such a system on the economy. Only 28 percent of respondents think that a cap-andtrade system would significantly reduce economic activity in the United States and a few respondents wrote in that such a system would actually increase economic activity. A larger percentage (37 percent) say that if revenue from sales of emissions permits or a carbon tax are used to reduce income taxes, the U.S. economy could be made better off. A slight majority of respondents (53 percent) think that a carbon tax would be superior to a cap-and-trade system. Only 20 percent of respondents believe that human activity does not play a significant role in climate change.

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