February 16, 2010

Victory Lap!

I fear some good people -- even some around ThreeSources -- are too optimistic too soon about the collapse of the global warming debate. What's the Star Wars line? Nice shooting, kid, don't get cocky!

But I'll confess we're having a realty really really really good few weeks here.

Three Major Firms Pull Out of Climate Change Alliance

ConocoPhillips, BP America and Caterpillar pulled out of a leading alliance of businesses and environmental groups pushing for climate change legislation on Tuesday, citing complaints that the bills under consideration are unfair to American industry.

The sudden pullout of three corporate giants from a leading alliance of businesses and environmental groups could be the death knell for climate change legislation languishing on Capitol Hill.

UPDATE: The WSJ Ed Page agrees.

The departing are BP America, Conoco Phillips and Caterpillar, which were among the original members of USCAP, a coalition of green pressure groups and Fortune 500 businesses that tried to drive a cap-and-trade program into law. Some corporate members concluded that climate legislation was inevitable and hoped to tip it in a more business-friendly direction. Others—ahem, General Electric—are in our view engaged in little more than old-fashioned rent-seeking. Through regulatory gaming, Congress would choose business winners and losers, dispensing billions of dollars in carbon permits to the politically connected.

The climate bills the House passed in August and Senate liberals are contemplating have stripped away that illusion. Carbon tariffs and other regulations would have damaged heavy manufacturing against global competitors, which explains Caterpillar's exit, while oil companies would suffer as transportation, refining and power generation via natural gas were punished. Then there's the harm to long-run growth, which would slow under the economy-wide drag of new taxes and federal mandates.

Deleterious Anthropogenic Warming of the Globe Posted by John Kranz at February 16, 2010 6:16 PM
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