Most of California’s business community agrees, California’s cap-and-trade will hurt business and the California economy. Even with the damage tot he economy the California is moving ahead with their experiment.
The state will auction tens of millions of dollars’ worth of carbon-emission allowances. The computerized auction is the start of California’s “cap-and-trade” market. The goal is to reduce greenhouse gases. Cap and trade is designed to force companies to scale back their carbon pollution or purchase allowances to get into compliance.
It is estimated the tax will raise $1 billion in it’s first year. The cost to business will skyrocket in 2015. The tax money paid to the state will slow or stop hiring by many of the state’s businesses. Other western states do not have the carbon tax so only California businesses will be crippled. A move that may force even more business to move out of the state.
While the damage to businesses is clear, there is no evidence that cap-and-trade will even work in reducing carbon output. With no cap-and-trade program in place, carbon emissions in the US have been dropping. Since 2006, the United States has cut its carbon-dioxide emissions by 7.7 percent. This is on track with what Europe is achieving under its cap-and-trade system.