Atmospheric carbon emissions in the United States have elicited a myriad debate on the effective policies, which should be enacted to save the economic global change. Proposed policies are essential curbing the menace. Primarily Energy efficiency policy is vital. The mentioned policy encompasses providing consumers with tools to effectively monitor and adjust their energy use. Notably, cap and trade system policy is also vital. The mentioned system employs financial inducement in encouraging reduction of carbon dioxide by companies. Here, a regulatory body set maximum annual limits of carbon emissions (Turk & Bensel, 2014). Also, a carbon tax policy connotes to a tax on emissions of carbon dioxide coupled with other greenhouse gases. Additionally, the intention of a carbon tax is to trim down emissions of carbon dioxide, thereby, making it more costly to pollute.
Categorically, the cap and trade policy is more efficient and effective. The mentioned policy would have myriad impacts on the USA economy. The mentioned policy would help manage inflation. Reasonably, the policy automatically accommodates the new prices, thereby, preventing both regulatory actions and legislative. By automatically adjusting to new economic prices, inflation is regulated. The cap and trade policy would be responsive to cost changes. This is evident as the policy allows polluters to purchase extra permits beyond the cap (Condon & Sinha, 2013). Additionally, a price set by the government to companies regarding pollution would ensure a reduction in production cost. The reduced cost of production would mean affordable prices to the consumers, thereby, boosting the economy.
Cap and trade policy is responsive to recessions. The mentioned responsiveness is a form of automatic fiscal incentive. Therefore, the automatic decrease in emission cost would definitely be a notable stabilizer to the US economy. Moreover, the drops in emission price often mean a financial effort reduction cost. A cap and trade system gives better mechanism of reducing cost uncertainty regarding emissions level (Helm & HepBurn, 2009). Also, the system offers partial distribution of allowances of compensation. This would be a plus to the solutions caused by burdens of climate change. Provisions for borrowing and banking allowances are also inevitable. The mentioned provisions availed by banks are vital for economic development. Additionally, the system is undemanding to harmonize with other particular countries. The mentioned harmonization would greatly aid in its implementation, thereby, increasing good economic relations among states.
Condon, B. J., & Sinha, T. (2013). The Role of Climate Change in Global Economic Governance. New York: Oxford University Press, Inc.
Helm, D. & HepBurn, C. (2009). The Economic and Politics of Climate Change. New York: Oxford University Press, Inc.
Turk, J., & Bensel, T. (2014). Contemporary environmental issues (2nd ed.). San Diego, CA: Bridgepoint Education, Inc.