Emissions Trading Environmental Policy:
This policy also known as the emissions trading/cap-and-trade policy is a market-based approach in controlling pollution by the offering of financial incentives for reduction in emission of pollutants (Stavins, 2001). The government will set a limit on the amount of pollutants that each company is allowed to emit, and this is given out in the form of emission credits. Should a company require more credits, they would have to purchase them from those which require lesser permits. This transfer of permits is known as emissions trading, the buyer has to pay for the extra credits, while the seller is rewarded for the reduction of emissions (Montgomery, 1972).
Carbon Tax Policy:
Command and Control Regulation:
- Capping of total amount of greenhouse gas emissions
- Lowering the aforementioned cap (1) over time
- Issuing of permits to ensure no one goes over the capped amount
- Pollution credits
This policy also known as the emissions trading/cap-and-trade policy is a market-based approach in controlling pollution by the offering of financial incentives for reduction in emission of pollutants (Stavins, 2001). The government will set a limit on the amount of pollutants that each company is allowed to emit, and this is given out in the form of emission credits. Should a company require more credits, they would have to purchase them from those which require lesser permits. This transfer of permits is known as emissions trading, the buyer has to pay for the extra credits, while the seller is rewarded for the reduction of emissions (Montgomery, 1972).
Carbon Tax Policy:
- Effectively the taxation of carbon emissions
Command and Control Regulation:
- Fixed set of emission goal for each company
Issues with the policies:
The main issue with most of the policies now is the fact they institutionalize greenhouse gas reduction, cleaning up air in certain areas but creating emission hot spots. Emission hot spots are concentrated in areas where most low-income and people of color reside in, causing them to be impacted the hardest from the effects of these hot spots; in worser cases, it may also contribute to the widening of the socio-economic gap. Therefore, even though there is overall regional reduction in greenhouse gas emission, there will be localized dirty-air hot spots which would endanger the lives of many people. (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013)
There is one major concern with the carbon emission reduction policies, such as the Carbon Tax policy and the Command and Control Regulation, as they are regressive. This is so as with the cut and limit on emission, companies cannot produce as much products as they used to, resulting in shortage of goods in demand, causing there to be an inflation in prices of goods. This burden of rising costs will fall disproportionately on lower-income households (Walls and Janson 1996; Hassett et al., 2008) There is a study by the Congressional Budget Office showing how a program intended to cut carbon emissions by 15% would cost a low-income family 3.3% of their average household income, in contrast to 1.7% of those middle to high-income families. (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013)
Pollution credits of the Environmental Trading policy might cause significant climate gap problems. These pollution credits allocated to facilities and companies which grant them the right to emit a certain amount of greenhouse gas. The more emission credits one has, the more greenhouse gas one can emit hence, there is worry that should emission credits be handed out for free, it might be regressive. (Dutzik et al., 2007). Alternatively, under the cap-and-auction or free-based strategies, whereby companies can sell and buy emission credits, bigger companies may buy emission credits from smaller companies, resulting in no reduction in their emission.
The main issue with most of the policies now is the fact they institutionalize greenhouse gas reduction, cleaning up air in certain areas but creating emission hot spots. Emission hot spots are concentrated in areas where most low-income and people of color reside in, causing them to be impacted the hardest from the effects of these hot spots; in worser cases, it may also contribute to the widening of the socio-economic gap. Therefore, even though there is overall regional reduction in greenhouse gas emission, there will be localized dirty-air hot spots which would endanger the lives of many people. (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013)
There is one major concern with the carbon emission reduction policies, such as the Carbon Tax policy and the Command and Control Regulation, as they are regressive. This is so as with the cut and limit on emission, companies cannot produce as much products as they used to, resulting in shortage of goods in demand, causing there to be an inflation in prices of goods. This burden of rising costs will fall disproportionately on lower-income households (Walls and Janson 1996; Hassett et al., 2008) There is a study by the Congressional Budget Office showing how a program intended to cut carbon emissions by 15% would cost a low-income family 3.3% of their average household income, in contrast to 1.7% of those middle to high-income families. (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013)
Pollution credits of the Environmental Trading policy might cause significant climate gap problems. These pollution credits allocated to facilities and companies which grant them the right to emit a certain amount of greenhouse gas. The more emission credits one has, the more greenhouse gas one can emit hence, there is worry that should emission credits be handed out for free, it might be regressive. (Dutzik et al., 2007). Alternatively, under the cap-and-auction or free-based strategies, whereby companies can sell and buy emission credits, bigger companies may buy emission credits from smaller companies, resulting in no reduction in their emission.
What should be done?
When it comes to climate change, our health would be the most affected, and would disable us the most financially. Hence, by closing the health gaps between the rich and poor, this might reduce the impact climate gap would have on the low-income families and people of color. To do so, one could focus on educating the minorities and poor individuals on the effects of global warming and reasonable preventive measures, using new mapping technologies to predict which areas would be the most vulnerable to the heat waves, and researching on potential benefits and harms of new and old fuels to reduce toxic and greenhouse gas emission. (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013) Measuring the success of mitigation strategies on the criterion that it helps to benefit and protect EVERYONE-researching in new technology to lessen the impact of global warming and inventing economical cooling devices that are affordable for all, especially for low-income families.
To develop policies to address the growing socio-economic gap between the rich and poor, policy makers could consider how low-income families and people of color would be affected by the policy (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013) since climate change is bound to affect certain job sectors more than others. Hence, by identifying and addressing inevitable job shifts beforehand and helping the people most affected by it to maximize their job opportunities, we would be able to help lessen the impact of climate change and reduce the climate gap between the rich and poor.
Close the conversation gap (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013). There has been endless dispute over those who favor cap and trade, and those who support carbon fees. These are two groups of people with contrasting goals, one works for the recovery of the environment, the other works for the recovery and sustainability of the environment. However, if there is a way to strike a balance and find a commonality between the two goals, we would be able to solve the dispute. [89:]
- Closing of health gaps between the rich and poor
- Develop policies that address the growing economic disparity between the people of color, low-income individuals and the rest of the population
- Close the conversation gap
When it comes to climate change, our health would be the most affected, and would disable us the most financially. Hence, by closing the health gaps between the rich and poor, this might reduce the impact climate gap would have on the low-income families and people of color. To do so, one could focus on educating the minorities and poor individuals on the effects of global warming and reasonable preventive measures, using new mapping technologies to predict which areas would be the most vulnerable to the heat waves, and researching on potential benefits and harms of new and old fuels to reduce toxic and greenhouse gas emission. (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013) Measuring the success of mitigation strategies on the criterion that it helps to benefit and protect EVERYONE-researching in new technology to lessen the impact of global warming and inventing economical cooling devices that are affordable for all, especially for low-income families.
To develop policies to address the growing socio-economic gap between the rich and poor, policy makers could consider how low-income families and people of color would be affected by the policy (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013) since climate change is bound to affect certain job sectors more than others. Hence, by identifying and addressing inevitable job shifts beforehand and helping the people most affected by it to maximize their job opportunities, we would be able to help lessen the impact of climate change and reduce the climate gap between the rich and poor.
Close the conversation gap (Morello-Frosch, Pastor, Sadd & Shonkoff, 2013). There has been endless dispute over those who favor cap and trade, and those who support carbon fees. These are two groups of people with contrasting goals, one works for the recovery of the environment, the other works for the recovery and sustainability of the environment. However, if there is a way to strike a balance and find a commonality between the two goals, we would be able to solve the dispute. [89:]