What will cap and trade to for the economy?



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    Cap and trade will give some industries and advantage over others. Unlike a simple carbon tax system, a cap and trade system would allocate carbon credits to certain companies, most likely the companies that make the largest campaign contributions to the authors of the bill. Smaller companies would have to buy carbon credits from these industries at a high price if they wanted to stay in business. On the other hand, a simple carbon tax would put all industries on equal footing.

    Either way, a carbon control program would increase the cost of producing carbon-intensive products. Companies may simply produce fewer of these products, invest in technology to make them with less carbon, or do some of both. This would cause the price of any product manufactured with a lot of carbon involved to increase, and consumers would not be able to afford to buy as many as they did before.

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