From the Editors over at NRO:
It is difficult to believe that at a time when the U.S. economy is struggling to adjust to record-high energy prices, the Senate is debating a bill that would make prices even higher. If you want to know why a group of responsible politicians would support such an idea, look no further than an analysis of the revenues the federal government stands to gain from a cap-and-trade program. The EIA estimates that by 2030 the federal government will be auctioning 84 percent of the program’s carbon allowances, with total revenues of anywhere from $326 billion to $853 billion. If you think that money will go toward deficit-reduction, dream on.
As I asked in my latest column, why do we need a planned economy for energy or anything else? Why not a fully deregulated free market for energy where prices allocate production and consumption?
Why not allow higher oil prices to open the door to a full portfolio of energy resources, including offshore drilling, Alaska, nuclear power, oil shale, conversion of coal and natural gas to liquid fuel, and the development of so-called alternative-energy sources such as solar, wind, and various cellulosic investments (although this latter group may never contribute more than 10 percent to our energy needs)?
A true free-market approach wouldn’t pick winners and losers with heavy subsidies or penalties.