The NYT had an article today on the Republican candidates positions on global warming. At one point it reports that Senator McCain has supported a cap and trade system, but opposes a carbon tax. According to the article, Mr. McCain said that he opposed a carbon tax because he "opposed new taxes but that he also believed that poor workers who tended to commute to work longer distances would be disproportionately affected." A cap and trade system would create a certain number of tradable carbon emission permits which can be auctioned off or distributed through some other mechanism. This would lead a price to associated with carbon emissions just as a tax would. A poor person commuting to work would pay more for their gas because the oil carbon had to buy carbon permits just the same as if they had to pay a carbon tax. From the standpoint of commuters and the economy there is no obvious difference between the impact of a cap and trade system and carbon taxes, if they are set at a level where they bring the same reduction in emissions. The article should have noted this point and informed readers that Mr. McCain either does not understand his own proposal or is not being honest with voters.
--Dean Baker
