California’s first carbon auction raised $245 million for the state. The Golden State government created an easy money scheme based on an inert molecule labeled as a pollutant and charged businesses for the privilege to emit it. Ultimately, the sin of carbon trading is paid for by the people.
California’s cap and trade law, Global Warming Solutions Act of 2006–also known as AB 32– enabled the collection of tax from carbon emitters. While every human being emits a little carbon with every exhale, the state of California sought to save the environment less from people than the big businesses that can pay big for emitting.
Because it is difficult and expensive to quit emitting carbon altogether, California established a market in carbon. What a brilliant maneuver to make a market out of a substance that nobody wants!
California established an auction to sell the privilege of emitting carbon (actually carbon dioxide, CO2) during industrial production. This allows companies that produce less carbon than the law allows to sell its credits to companies that produce more carbon than the law allows. This is called carbon trading, and a market exists between businesses because the government put a price tag on the right to emit carbon.
The government, seeing opportunity for itself, can sell such carbon-emitting privileges directly to buyers at auction. The state collects auction revenues for the transfer of emitting privileges, having produced the market from the hot air of the global warming hoax, combined with the power to create laws that make money for government.
There were 23,126,110 carbon allowances up for auction, each requiring a minimum bid of $10.00. Most bids were higher than that. After all, survival was on the line for many businesses. The highest bidder pays to emit in exchange for another business never emitting much at all.
Note that in this exchange, no CO2 is removed from the air, only moved to a different emitter. Carbon emissions do not change, nor are they reduced, not that reductions would effect global temperatures much anyway. And, by the way, how was California going to keep any carbon- reduced air from moving out of state?
By now, we know that cap and trade has nothing to do with the environment or carbon emissions and is nothing but a pay-to-play ploy to extract funds from industries seeking to survive.
Cap and trade is really a movement to make money for government through the forced participation of businesses. High bidders bid high, lest the government shuts them down for emitting too much carbon. Paying the government for businesses to stay in business is the game being played.
And it works. The industries that participated in the California auction include electric power, oil, gas, gasoline, water, foods, refining, and municipal utilities. Companies include BP, Chevron, Exxon, Lockheed Martin, San Diego Gas & Electric, Los Angeles Department of Water and Power, and ConAgra Foods, to name a few. Imagine if all those industries shut down in California. Life as we know it would come to a halt.
Pass costs to consumers
Rather, California government benefits from the business instinct to survive and the human instinct to stay alive. Participating businesses will pass their carbon costs on to the consumer, raising the cost of life-sustaining goods and products requiring energy to produce. Prices for mostly everything will go up for everyone. In the process, carbon trading funds bigger government with environmental benefit purported only as a cover-up.
A whopping $245 million was raised from participating businesses for the state of California, with funds of greater sums estimated from future auctions. Californians can’t help but suspect that the state will spend it on unions, pensions, entitlement payments, public sector augmentation, and the expansion of even bigger government and state agencies.
Cap and trade is the sin of state government against the ordinary person’s struggle to stay alive in California.