Carbon Tax And Carbon Credits Explained

Within this past century the capitalist economy we live in has improved our way of living

. It's also allowed us to make big technological advances. Capitalism has provided the necessary ingredients for our economic recipe to work, to provide us with products beyond our imagination and to create large cities. The free markets accurately reflect the supply & demand within our countries. It allows us to price everything from agriculture to medicine. Capitalism effectively prices even our most valued resources.

However despite all of our humanities achievements. capitalism fails to acknowledge the environmental impact of all of our actions. Ever since the 1950's co2 in our atmosphere has risen to 300%. According to actual scientific data. Climate emissions by man are to blame for global warming. The increase in earth global temperature has had destructive effects on the environment. Carbon emissions have melted the polar ice caps, destroyed wildlife and has created more powerful hurricanes. Sea levels globally have risen to 4-8 inches with the past 100 years and global warming could eventually lead to an underwater Manhattan. So is it possible to use free market economics our primary tool to solve global warming our #1 problem.

Currently people have little motivation to change their life-style to help the environment. So why not use our money? Man-kinds most powerful motivation to generate change... Introducing Carbon Credits Explained. Carbon credits act as a fiance tool which can be traded like a basic commodity or a stock. These carbon credits via a carbon tax place a monetary price on our populating activities. By creating a market for carbon credits individuals can earn money for their carbon reductions. also by trading these carbon credits we can use market forces to reduce carbon emissions at the lowest cost for society.

So how a does a carbon tax work? Whenever oil is being burned it will release pollution. A cap on carbon emissions will make industries more cautious about putting co2 into our atmosphere because it will cost them. What this means is big businesses will want to reduce CO2 gasses because they will make more money because of carbon tax and carbon credits. This carbon cap will ensure that we as a society do not go over the limit and should set the USA on a course of energy independence.

So will Carbon Tax and carbon credits work? Well a lot of environmentalist like the answer to solving the global warming problem and many economist have said in the past that in order to save the environment and get people to go green it will have to be economically practical. Many critics say its just a scheme to get the developing world down (i.e. India, China, Brazil, etc.). They say this because in these nations they don't have the luxury of switching back and fourth to different energy methods.

Some businesses have already created such trading systems to reduce global warming. The Chicago climate exchange is the world's first and North America's only active voluntary, legally binding trading exchange for carbon credits. With the international resolution of trading standards we can finally begin to acknowledge and account for the environmental impact of our progress.

by: Brandon Smitherston

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