Cap and trade is a policy solution that works to reduce pollution faster and at lower cost than standards. We know it can work because it has been used successfully to reduce SO2 and NOx emissions from power plants under the US Acid Rain Program (trading has taken place since 1994). It worked to expedite the removal of lead from gasoline (read pages 82-83), it worked to phase-out CFCs and halons, it worked to reduce smog in Los Angeles under the RECLAIM program, and it worked to significantly reduce emissions in the EU. Can it work on a global scale with C02? It seems promising. Will it be complicated? Yes. Will there be opposition? Yes. Will there be unintended consequences? Yes. Should we therefore dismiss it?
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