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Democratic Pollution Credits

Every person gets a pollution credit they can sell to companies.
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Please let me know if this one's baked, but I haven't heard of this solution. I live in the US, so this process is a bit more difficult here than in a country that has an ounce of foresight and signed the Kyoto protocol. Here's the idea:

My understanding of the Kyoto protocol is that each country has pollution credits, which they can trade with other countries. I propose we extend this downward. A country can disperse their pollution credits to individuals each year (since they are the ones that have to breathe the air). Companies that want to pollute would have to buy sufficient credits from citizens. If I want less pollution in the world, I can hold onto my credits and not let anyone have them. Of course, if everyone did this, the price for the things would skyrocket, and will hit a point where people would be willing to trade slightly polluted air for that amount of money. The point is that pollution would truely become a cost of business, and people would have direct power to influence this pollution. Of course, fines would be imposed on companies who pollute without credits and would probably have to be tied to this market, such as forcing them to buy twice the amount next year.

mgangemi, Jan 27 2003

Pollution Credits http://www.google.c...&btnG=Google+Search
Been around for a while... [Shz, Oct 17 2004]

Democratic Pollution Credits http://www.google.c...ollution+credits%22
:-) [mgangemi, Oct 17 2004]

[link]






       And let people earn more credits (that they can then trade/sell off) by, for instance:
* re-insulating their house
* moving closer to work
* buying a more efficient car
krelnik, Jan 27 2003
  

       I like it so far. What's the hidden downside?
snarfyguy, Jan 27 2003
  

       Who wants to buy my credits for gum, butt ends and spitting on the ground?
DrCurry, Jan 27 2003
  

       [snarfyguy] What's the hidden downside?   

       Just the companies complaining that they will have to pay for something they now get for free.
mgangemi, Jan 27 2003
  

       Companies complaining isn't a downside. Unfortunately, corporate / industrial lobbying will prevent anything like this from ever happenning.
snarfyguy, Jan 27 2003
  

       Rising prices would be the probable downside. But it's a downside of the concept of controlling pollution in general, not specifically of this idea.
waugsqueke, Jan 27 2003
  

       So what if everyone has pollution credits? It changes nothing. You'd still need an authoritarian police state to monitor how people were living their lives. People could sell their credits and then drive to work anyway.   

       If you want to preserve land/resources or whatever, put your money where you mouth is and buy vast tracts of lands and do nothing with it ever.
mayan, Jan 27 2003
  

       This is an interesting idea. As waugsqueke says, the value of credits held or sold would quickly come back to the consumers in the form of price increases, but these would be proportionate to the environmental damage caused by the production of each good, which is useful. There are other problems, though.   

       Most existing schemes of this kind assign credits directly to companies and then ratchet down the amounts available. (The original gift of credits just makes explicit the current arrangement, whereby founding or buying a facility of a certain kind earns you the right to discharge toxins up to some regulatory limit). Some comparative disadvantages of this new proposal are:   

       1) The end results are similar, but the implementation is a lot more complicated and there are more potential inefficiencies: Credit availability/cost would be more difficult to predict, the logistics of buying credits from individuals would create third party brokers and other extra costs, etc.   

       2) Requiring companies to suddenly buy all credits directly from individuals might cause a large number of catastrophic bankruptcies and some fairly enormous economic problems; if it didn't take hold simultaneously in all the countries of the world, it would essentially destroy the national economy. This is less attractive than it sounds.   

       3) The right to withhold credits, which seems to be the unique benefit of this plan, has a serious drawback: People who do sell credits benefit from the cleaner air and people who withhold them suffer from the pollution. With existing schemes, the population equally shares the costs and benefits.
Monkfish, Jan 27 2003
  

       [Monkfish] point 1) I agree in principle, but I would imagine the costs to be less than you imply due to our electronic age. I'm envisioning some government web page where buyers and sellers log on and trade - I can either sell at the highest price offered, or browse companies' web sites to see who I think is managing their resources wisely.   

       2) I agree that this plan would have to be implemented slowly and carefully. However, I disagree with your country-competition point. This plan won't change anything, as my arguement is based on the assumption that this country is following the kyoto agreements. The total amount of pollution already has to reach a given level, it's just a different implementation.   

       3) Like all of these plans, the largest overall cut in pollution will be from the total amount of pollution credits dispersed. This plan recognizes that the people own the air, and should be given the choice of how they use it. If everyone chooses to sell to the highest bidder, great - it's just like the other plans. If some choose to withhold their credits or only sell them to green companies, it's an improvement.
mgangemi, Jan 27 2003
  

       1) Well, I disagree. Providing company information would be costly, accounting and trading would be costly (even if the entire population were on-line), skimming aggregators would be costly, policing and education would be costly. And then there's the value of the time and effort required of every citizen to manage their pollution credits one way or the other. Still, who knows.   

       2) No, there's a basic difference here that you're not accounting for. Companies currently have the right to pollute for free; Kyoto and (other) credit-trading schemes basically preserve this. With your scheme, companies have to buy the right to pollute starting at arsenic particle one. This is a very large and difficult-to-assess new cost that corporations in other Kyoto-adhering countries do not have. Even if the requirement is introduced gradually, the long-term impact will need to be accounted for immediately, and companies with strong international competitors will be wiped out.   

       To keep these companies in business, you would need to either pay them subsidies equal to the cost of the credits or levy protectionist tariffs (which would be disastrous). This would be a very difficult and actually rather silly situation.   

       3) This is mostly a matter of opinion, but I feel that this amounts to a tax on conscience; the many who sell their credits get money and cleaner air, those (very few) who withhold don't. You could manage almost any public good this way -- have schools, hospitals, social services, etc. paid for just by those who think they're worthwhile -- but I don't think it's the way to go.
Monkfish, Jan 28 2003
  

       <bumper sticker> "Earth First ! (We'll wreck the other planets later .....) </bumper sticker>
8th of 7, Jan 29 2003
  

       [Monkfish] I can see your extra cost issues as valid and difficult to work around. However, I still fundamentally disagree with the global competition issues. The only true costs are in reducing pollution (which all Kyoto countries have), assessment, and administration. Everything else is artificial and can be balanced out. For instance, even if you end up having to subsidise (evenly across the board), only the gross polluters would die out or change from high costs. The average-polluting companies would be in the same place, and the green companies would be better off. As for the cost of assessment, I just can't believe that this isn't part of Kyoto. How does anyone know if their country has reduced pollution if nobody's measuring it? Besides, most large polluters are measured currently or should be if they aren't.
mgangemi, Jan 29 2003
  

       I think the supply and demand situation was overlooked. there would have to be a minimum price for sale which would completely go against the whole "free market" deal. Maybe it would be better to just tax polluting activities and use the funds for environmentally friendly programs.
underground_uproar, Nov 14 2006
  
      
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