Why the Tariff Provisions in the American Clean Energy & Security Act (ACESA) Will Survive
I previously wrote that the Obama Administration should back off its opposition to language in Waxman-Markey that imposes a tariff on imports from countries that do not require equivalent levels of GHG emissions reductions. This tariff provision is the only effective way to discourage US businesses from moving production overseas to countries with less stringent climate change laws, thereby defeating the goals of cap-and-trade by emitting over there what they cannot emit here. Opponents to the tariff provision claim that the bill's generous allocation of free emission allowances compensates firms for this disparity and thereby levels the playing field so that competitors in foreign countries lacking carbon emission controls do not enjoy a competitive advantage over carbon-capped US businesses.
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