04/12/2009 05:12 am ET Updated May 25, 2011

Carbon Cap-and-Trade

The climate is getting "weirder" as Thomas Friedman likes to say. Most people agree that climate change is real and I'm over the doom and gloom. Lets do something about it and put a price on carbon.

There is growing support in Washington, D.C. for a carbon cap-and-trade program. President Obama made an ambitious promise during his campaign to implement an economy-wide cap-and-trade program to reduce greenhouse gas emissions 80% by 2050. The President seems to believe a cap-and-trade program will soon become law -- the President included $645 billion in assumed revenue by the year 2019.

Congress is getting serious. House Energy and Commerce Chairman Henry A. Waxman, California Democrat, has stated that he plans to have a bill passed by Memorial Day. Senator Barbara Boxer, Chairwoman of the Environment & Public Works Committee is researching the use of a budget reconciliation process as an avenue for passing legislation.

The basic concept of a program is that the government sets a cap on the amount of greenhouse gas emissions a company may emit. If a company exceeds their emissions they must buy credits from those companies which pollute less. The cost of buying and selling these credits would be determined by the market.

A cap-and-trade program is an example of free market environmentalism. It harnesses a company's creative forces to find effective ways to reduce emissions. Individual companies can freely choose how or if they will reduce their emissions.

I hope President Obama holds up to his campaign promise. This year of change, lets pass a carbon cap-and-trade bill!