You should probably take another look since you seem to miss what I think is the core of the idea- a descending cap on carbon is the most important, and surest, thing we can do to reduce emissions.  

Now, how do we make that cap politically viable enough to pass (since everyone understands that increasing costs is an unpopular political thing to do) and last through the dozens of elections and economic cycles that it has to.

I think protecting incomes is the best way to make the cap viable(as does Peter, Robert Reich, George Lakoff, McKibbon, etc).  

I think everyone agrees that investment is crucial- but not more crucial than guaranteeing reductions.

Hmmm...

I see, pay off the special interests. There's not enough money to pay off every interest that will be impacted.  That's what we learned with ol' L-W.  

And actually, the dividend will act as a stimulous by protecting incomes while still driving behavior changes and investment by increasing carbon costs.  

There was 100 billion in green tech investment last year without a cost on carbon.

Some public investment is,of course, needed but why would we raise it regressively? And why must it come from auction revenue?

A few points:
The original version of Sky Trust addressed concerns about equity for workers displaced by the increased cost of CO2 emsissions. Twenty-five percent of the funds collected from the auction and the sale of additional credits would be disbursed to the states to help those most dramatically affected, such as coal miners. The states’ share would decrease by 2½% yearly and the money added to the pool distributed to the public. I don't know when or why Mr Barnes modified his thinking, but I don't think the changes are for the better.

The lump-sum payments would be more than "incentive to stay alive." They would be a bribe to support the painful policies necessary to deal with climate change. I don't see that as a bad thing in a country where the atomizing effect of the market and the cult of individuality have overcome much of our sense of nationally- or communally-shared action and sacrifice.

It's nonsense to think people don't change their household energy use in response to price. Remember the late 1970s? Conservation? And if folks can't (or won't) change it, they may look for other ways to get those energy services. That could be a boon to alternative technologies.

A $2 rise in the price of gasoline is equivalent to $800/ton of carbon, not $200/ton.

I wonder if we are only now beginning to see reductions in gasoline demand and increased bus ridership because of the pathetic state of mass transit in this country. Might folks have started getting out of their cars when gas was $2.75/gal if the prospect of negotiating their local transit system didn't fill them with horror?

Why allow ourselves to fall into a mindset where the money from carbon credits, all alone, must deal with the problems that will arise, must serve all purposes? Eliminating tax subsidies to the fossil industries could supply money, too. And, of course, we could always take several hundred billion dollars a year from that five-sided black hole on the Potomac.

  Even if the permits are regressive. Even if most consumers are too ignorant of how to change their consumption, medium and large sized businesses are pretty price sensitive, and will respond to the changing costs of their inputs. A lot of the demand response is going to have a long delay time, as in many cases new products must be designed, and then production slowly ramped up. We all recognize how much better off we would be today, if gas taxes had been raised a few years back, i.e. the early price signal would have accelerated the shift away from SUVs, that is now so crucial for surviving peak oil.

   A second way to market CO2 charges, is as preparation for peak natural gas, and peak coal, which aren't very far off. Our industrial planning system, has been shown to not make very good predictions of future scarcity (it completely missed current oil spike), and CO2 emissions charges only move us onto a slightly more aggressive decarbonation schedule than geology would impose on us anyway.

A feature which gives money to low income workers might be a useful addition.

In an ideal world, we could have the bulk of that money primarily spent on venture-capital-style government R&D investment programs, and as a fund for green energy financing into green energy.

And of course "Recycled Energy" i.e. Efficiency gains.

Frankly as said before, I still look at it like this.

Full Auction
No Offsets
Use the money collected as pork to buy votes from Republican Senators, and attempt to keep it out of the operating budget of fossil fuel companies.

(For instance even if all the money was piled into CCS investment, that might still be fine.  Since it's not the operating budget, and doesn't displace their operating budget.)

I definitely agree that cap-and-dividend is more of a catchy idea than a good one.  The problem is that, while I think most people agree that its important to invest some of the revenue, people disagree on how.  And so most people agree we need to invest, but reject everyone else's idea.  And so Boxer tried to insert everyone's ideas to buy votes.  This would give Senators political cover to vote for a Cap, but unfortunately it also gave political cover to Senators who would oppose it unconditionally, but now got to harp about mismanaged funds.

On investment though, I disagree that deployment of today's technologies should be a priority.  The cap itself (and price premium it imposes) is the incentive to deploy today's technologies.  There are some areas where the market disconnects exist, and so where there would be exceptions, but these are fairly limited.  Investments in research should definitely play a much larger role than subsidizing deployment. Don't offer money for people to buy a Prius, spend the money on developing better batteries that will allow everyone to buy a Prius 2.0.  

The bottom line is that since companies get all the revenue from installing their own wind farm or w/e, they have all the incentive to do it.  Research creates benefits that no single company can capture entirely for profit, and so is the perfect (and necessary) role for government.  Especially when government imposes a program that will cause serious constraints on the economy once the low-hanging fruit is picked.  Its time to get started on those solutions now, so we don't get hit by a supply shock of Carbon Credits like we did on oil.  

The debate so far is treading the line between total free market and socialism. We need to decide where on this spectrum we want to be. To return carbon permit/tax revenue to "green" business for renewable technologies, to any degree, is what we have now: socialism for the rich. To return it equally to all citizens WITHOUT other regulations and policies is that Citizen Market in the Sky means "socialism for the poor" so  that people will be able to pay their bills, but it doesn't do anything to construct a new energy economy. What was left out was the imperative need to eliminate all energy subsidies and tax breaks to all energy sectors which would not only raise the costs of fossil fuels but would level the playing field so PRIVATE investors would come in and invest in green technologies, which in turn would create new businesses and jobs. Thus, the dividend is "socialism for the poor" but ending subsidies reflects the "free market".
I shudder to think about all the hands that will reach out for technology subsidies, diminishing the pot of money that , justifiably, needs to be put into infrastructure through PUBLIC programs. We don't want to privatize our electric distribution system do we? No. We want private capital to support the development of green power by removing the barriers to  genuine green entrepreneurship, not by subsidising them.

All these plans seem to be scam as usual Peter.  That's the problem.

Raise trillions with carbon emission permits or taxes?  With the trillions comes corruption.  And the well founded suspiscion that most of that money will never be invested in renewables and conservation.

Simply withdrawing the 10s of billions in subsidies to big oil, coal, nuclear, and fuel farming, completely corrupt use of tax dollars, and diverting it to per kwh subsidies, say 10 cents per kwh, to real citizens who actually generate GHG free power for the grid, with solar panels for instance, would seem to circumvent the usual corruption.

Trust the corporate/government cabal that got us into thios mess to get us out?  Doesn't seem prudent.

http://amazngdrx.blogharbor.com/blog

i like "skytrust" idea a lot, not least because revenue-sharing is a good way of financing this entire changeover. still, i see a couple real big holes, which maybe are because i haven't read enough about the proposal.

it looks like the dividends would be treated as income and could be seized under a bankruptcy agreement or other lien? hellish outcome ensues, similar to the payroll tax issue, but with the extra bit where usurers and skunks smell a nice meal. this may mean making it illegal to use the dividend as collateral in any way, complicating the financing of greener equipment. am i making sense?

we know very well now that good intentions don't magically become good sense or good information in the mind of a consumer and we know that people are bad at reading even the new-improved nutritional labels. if:

a. we're basing most of our emphasis on the price-of-operation of a commodity;
b. energy efficient technology tends to cost more on the shelf; and
c. your actual energy usage pattern for any class of gizmo is sort of unknown to you;

 how does a person choosing a television or a blender pick the "right" one, to save money-and-planet?

sustainability regulations and economies of manufacturing scale get you somewhere near there but after that there'd need to be something stupid like turning TCO into a real number like, "this blender costs 20¢ to make a milkshake now and will cost 35¢ in 3 years or less."

heads will be spinning like crazy. maybe a big red sticker on the non-illegal guzzlers: WARNING! THIS IS A REALLY BAD BUY!

of course stores that do that kind of energy inventory for customers will be well-loved, but that's not a plan.

3) which leads to the question of whether sharing out more money to low-footprint users will increase their consumption because the shelf price dominates their decision process.

it's supposed to be an outline in the style of "1.a."

What I don't get about cap and dividend or even Jim Barett's idea is that they both ignore the international picture.

If the developing economies are going to accept caps on their greenhouse gas emissions it is likely to be a on an equitable per capita emissions basis across the globe.

That means that the US is going to have to pay for substantial carbon credits from developing countries. Further, since the choice is between cheap coal or expensive renewables, we are going to have to find a way to subsidize renewable energy in developing economies.

How are we supposed to pay for both these things and either reduce payroll tax or send out cap and dividend checks?

If the developing economies are going to accept caps on their greenhouse gas emissions it is likely to be a on an equitable per capita emissions basis across the globe.

more likely i think it will be that on paper but in reality the agreement will be about progress on standard of living (unfortunately, still skewed toward "the best" people) through increasingly green means. industrialists and investors have too much power for an abstraction like an equitable political cap to mean anything.

bans on fuel sources, though, based on replacements, including efficiency, would fit better with the actual power of impoverished governments.

That means that the US is going to have to pay for substantial carbon credits from developing countries.

this doesn't have to be bought with carbon tax money, or with public money, nor does it have to be involved in carbon trading. for instance codevelopment, including public domain and open source for technology, would spread the R&D spending on a sliding scale.

another example is adaptation assistance. clearly an international security concern, but not a carbon issue, except as it is implemented alongside or united with mitigation, weatherproofing poor countries' infrastructure is a better bet for securing peace in many ways than preparation for conventional warfare.

Further, since the choice is between cheap coal or expensive renewables, we are going to have to find a way to subsidize renewable energy in developing economies.

number one way to subsidize it: bring it to industrial scale. get it to "cheap" so it's in their range.

#2 way: release poor countries from post-colonial debts.

#3 way: carbon tariffs.

#4 way: stop selling them weapons systems. no new submarines, missiles, jets, or aircraft carriers. no money for nukes, either, unless they're cost-competitive. that money should go to green energy and efficiency financing.

#5 way: stop giving them development-discounted loans for coal plants.

#6 way: start paying them higher prices for goods they manufacture, in exchange for setting high environmental and labor standards. fair trade. (peak oil's impact on trade-based development will probably be huge but maybe $200 oil won't be with us forever.)

#7 way: tell them that every new coal plant increases the likelihood of their glacier-fed water supplies dying forever.

#8 way: sit back and watch the middle players -- brazil, india, china -- figure out how to make everything they need at prices they can afford.

#9: direct investment.

and so on. i know i've read other ideas but i'm sleepy. anyway the only rule that says carbon permit or tax revenue must be the only money spent on carbon abatement is entirely in the minds of republicans and democrats who are wrong on the entire subject.