The Business of Global Warming

Tim Carney continues to expose the rent-seeking motives behind a lot of environmental regulation, in this case cap and trade legislation. As he notes, the story hasn’t changed much from the days of Enron’s enthusiastic support for the Kyoto Protocol.

Today, well-connected firms are lobbying for Lieberman and Warner’s Enron bill, which is the same environmentally dubious corporate boondoggle Enron had hoped Kyoto would spur.

General Electric has created a new business called GHG Services, which plans to pick up Enron’s CO2-dealing business, including winning free allowances through lobbying efforts.

Alcoa, similar to Enron’s coal gambit, makes much of its aluminum offshore, and so its energy-intensive manufacturing will be untouched by the Enron bill, while its lighter end-products (such as car frames) will be worth more.

Lieberman’s No. 1 donor, United Technologies, stands to profit handsomely from this bill’s research and development subsidies.

The early business coalition for cap-and-trade has become divided recently on the Enron Bill as it currently stands, and so it probably won’t become law until next year. But it’s all a bit sad — if this same bill had become law just seven years ago, the country and every family that pays utility bills, buys groceries and drives might be poorer, but those Enron shareholders would be much better off.

For more on the sordid story of Enron and Kyoto, see the chapter on the Enron scandal in Tim’s book, The Big Ripoff: How Big Business and Big Government Steal Your Money.