The History of Cap and Trade - Hunter

What are the consequences of passing cap and trade legislation on worsening the environment?  Cap and trade legislation makes polluting permissible within a legal framework.  Whatever makes polluting permissible withing a legal framework worsens the environment.

     The idea of cap and trade originated in the 1960's.  Called emissions trading, it was thought to be one of the best solutions to pollution problems.  The idea was to set a cap on how much pollution could be created.  Companies would then receive permits allowing them to pollute a certain amount.  If they didn't use them, they could sell them to other companies.  The thinking was that market forces would solve the problem.
     Cap and trade wasn't considered a viable option until the late 1980's.  Seeking to curb acid rain, the Republican George H.W. Bush administration supported the Clean Air Act.
     In 2005, the European Union passed cap and trade legislation to curb emissions.  Companies that were big polluters were given the most pollution permits and no incentive to stop polluting.  After the legislation was passed, emissions actually went up.
     In the United States, cap and trade legislation for emissions was introduced in 2009.  The American Clean Energy and Security Act as it was named, was passed by the House of Representatives.  It has yet to be ratified by the Senate.  Supporters included a large number of Democrats, many environmental groups, as well as energy companies.
     These supporters argue that cap and trade is the best way to deal with the climate crisis.  The cap on emissions will be lowered as time passes and force companies to pollute less.  They reason that smart companies will be able to profit by becoming more environmentally friendly and selling their permits.  It is a way to let the market fix the pollution problem.  Without many other viable options, those supporting cap and trade argue that it's better than not doing anything about the problem.
     Opponents argue that cap and trade would not work out as easily as others predict.  The biggest polluters are the entities that receive the most permits, thus rewarding them for polluting.  These valuable permits are given away for free rather than being sold or auctioned.  If companies had to buy these permits, they would become much more valuable and companies would think twice before polluting.  There is also the possibility the cap could be set too high and pollution could actually go up.  Because setting the cap is a highly political issue, companies are inevitably going to lobby to get it as high as possible.
     A main argument is that those involved in obtaining, buying, and selling credits will be unethical about it. There are businessmen constantly looking for the next bubble where they can buy low and sell high.  Cap and trade could be the next market to do so.
     Opponents argue that these and other issues will mean cap and trade will end up doing the opposite of what it was supposed to do.  Like what happened in Europe, emissions could actually increase.