Tom Friedman Trashes Cap n' Trade, Then Promotes it

Tom Friedman Trashes Cap n' Trade, Then Promotes it

Two commendable articles by former billionaire turned millionaire Tom Friedman – yes, that Tom Friedman – he of Hot, Smelly, Flat, Overcrowded, One World fame – are on the LWOH menu today, as yours truly does an about face and lavishes actual praise (mostly) on the notorious NY Times columnist and author who has, up until these two recent, uncharacteristically substantive and amusing articles, fully lived up to his reputation as “Mr. Fingernails on the Blackborad” for his unabashed, condescending, arrogant and hubris soaked elitist-evangelism of all things globo-corporate. (After all, no one could ever accuse the carbon-market enthusiast of outing his offshoring/inshoring loving corporate pals for living large at the expense of a growing body of unemployed, white collar Americans.)

Jay Yarrow's April 8, 2009 article entitled Tom Friedman Trashes Cap And Trade at the Business Insider references Friedman's intelligent preference for a carbon tax instead of this “Rube Goldberg contraption” of a cap and trade bill that Congress recently passed that “stinks.” He correctly explains that “most people” will understand a carbon tax but may not know what the hell “cap and trade” even means in the following NYT OpEd:

NYT: “Americans will be willing to pay a tax for their children to be less threatened, breathe cleaner air and live in a more sustainable world with a stronger America. They are much less likely to support a firm in London trading offsets from an electric bill in Boston with a derivatives firm in New York in order to help fund an aluminum smelter in Beijing, which is what cap-and-trade is all about. People won’t support what they can’t explain.”

But in his July 4th article yesterday entitled China poised to lead U.S. behind in clean energy (just a nit here, but did he mean “China poised to LEAVE U.S. behind...or has Pinchy outsourced all the copy editing to Mexico or India?) Friedman now says that he favors the climate/energy bill passed by the House. How did he go from trashing cap and trade in April to supporting a bill that includes it a mere three months later? For one thing, Friedman expresses deep concern that China has gotten on board the clean energy bandwagon — “big-time” and is genuinely worried that “China will clean our clock in E.T. (energy technologies)” if the U.S. doesn't commit to cleaning China's clock first by driving clean-tech innovation:

“This is a major reason I favor the climate/energy bill passed by the House. If we do not impose on ourselves the necessity to drive innovation in clean-technology — by imposing the right prices on carbon emissions and the right regulations to promote energy efficiency — we will be laggards in the next great global industry.”

Friedman now would suggest that the U.S. cap and trade system “drive” clean tech innovation in place of the straightforward carbon tax and cites what he describes as “key points” in his decision from this draft report of the president's Economic Recovery Advisory Board:

"If the U.S. fails to adopt an economywide carbon abatement program, we will continue to cede leadership in new energy technology. The U.S. is now home to only two of the 10 largest solar photovoltaic producers in the world, two of the top 10 wind turbine producers and one of the top 10 advanced battery manufacturers. That is, only one-sixth of the world's top renewable energy manufacturers are based in the United States. "... Sustainable technologies in solar, wind, electric vehicles, nuclear and other innovations will drive the future global economy. We can either invest in policies to build U.S. leadership in these new industries and jobs today, or we can continue with business as usual and buy windmills from Europe, batteries from Japan and solar panels from Asia."

So which is it? Manufacturing or “carbon abatement”? Both? Is Friedman suggesting that we become a nation of coolies by reverting back to our manufacturing era days when the U.S. polluted big time before we cooked up the brilliant idea to turn China into our backyard dump by shipping all of our manufacturing over there? Is he really suggesting that we should now compete with China's infinitely cheap labor pool by producing these clean technologies here or does this sound more like he understands that there is some serious gold in them thar cap and trade hills for a few global insiders to turn a relatively quick ROI in a brand spanking new financial “bubble” market created virtually out of thin air that will make the dot.com bust look like a ride on the teacups at Disneyland?

For all of his well-addressed concern about the need to develop alternative energy solutions, why is Friedman now hedging his bets on what he admits is a flawed cap and trade bill? Once the regulation of carbon emissions is taken away from the EPA and placed into the capable hands of Wall Street – you know, those Goldman Sach$ guys and VC's on Obama's advisory bailout board – will the sky be the limit for a few insider profiteers? But Wall Street thrives on speculation... It does seem like an interesting fork in the road when combined with the bailout of insurance companies like AIG, among others.

Oregon Congressman Pete DeFazio astutely observes:

"An unregulated cap-and-trade system could be the next subprime mortgage bubble...It is just infinitely game-able," he said, relating how Europe is now trading in "carbon futures" that give industries additional emission permits now in exchange for, say, trees that may or may not be planted in the future. "These financial people, I mean, they are very smart people and they can figure out a way to monetize anything and it would just be nuts to go down that path.
It should be done with "old fashioned" regulation, of the same kind that reduced smog over our cities and cleaned the filth out of our rivers.
I am a very old-fashioned guy. First you inventory the sources of pollution, then you cap them. You get people a schedule to reduce. You monitor them, and you fine the heck out of them if they don’t meet them [the standards]."

Back to Tom Friedman and why I believe his latest article on the subject of cap and trade qualifies him for a temporary pass out of 2Truthy's doghouse... he mentions what may well be the link to getting Obama's healthcare reform off the ground to the energy/climate bill. Does he know something we don't about the shadowy Insurance players who could be willing to allow the transfer of funds to gradually slosh into the nascent carbon trading market? After all, money is just little electrons running around somebody else's computer – considerably less tangible than wampum -- and right now, the Insurance Lobby is feeling the heat from a sitting president who appears to be dead serious in his attempt to make healthcare available to all in the U.S. Now, what if Single Payer were passed (I know, this is not likely to happen but what if) and the Insurance industry collapsed? Where would all that money go?

Friedman writes:

“And this is why I disagree with President Barack Obama when he signals that he has to focus on extending health care and put the energy/climate bill — now in the Senate — on the back burner.

Health care and the energy/climate bill go together. We need both now. Imagine how poor we would be today if U.S. firms did not dominate the top 10 Internet companies. Well, if we don't dominate the top 10 E.T. rankings, there is no way we are going to be able to afford decent health care for every American. No way."

Aside from his obsession with U.S. globo-corporate domination, could Friedman be on to something by recognizing that the energy/climate bill and healthcare go together? I do, however, question his logic about needing to dominate the “top 10 E.T. Rankings” in order to be able to afford “decent health care” for every American. I mean, if other countries far less wealthy than ours, like Venezuela can do it – I see no reason to conclude this. (h/t The Rag Blog.)

I read somewhere recently that cap and trade would pay for U.S. healthcare reform. By allowing the evil health insurance industry which profits wildly through the calculated screwing of its paying customers to die on the vine, would this release funds to support a universal healthcare system supported by the creation of a dominant U.S. controlled global carbon market?

If so, then this would make me have to take Obama out of my doghouse, too. Or, I' just don't know what the hell I'm talking about and I am, for some mysterious reason, feeling more generous than necessary towards the usual suspects who might – just might – in a million years --- finally see that most of us really want to clean up this place and deserve the right to healthcare and to the right to contribute to the prosperity of our local economies that has been greedily denied to so many for far too long.

-2Truthy