The lie of cap and trade and politics  Published: September 17,
2012, 7:38 pm Updated: 3 years ago     As a matter of
terminology, the NDP leader is correct. What the party proposes,
and what Mulcair campaigned on in his run for leader, is not a
carbon tax, collected from consumers and businesses in the same
way as a sales or excise tax, but a system of tradable emissions
permits known as “cap and trade.” The government would set both
an overall limit on carbon emissions and the amount each
business would be allowed to emit; those that could get by on
less than their allotted quota would be permitted to sell what
was left to others, allowing the latter to exceed their quota by
the same amount. The burden of adjustment is thus borne by those
who can do at least cost, meaning lower costs for society  But
while the two systems differ in how they are applied, in concept
they are identical. A carbon tax raises the price of carbon,
which has the effect of reducing its quantity. Cap-and-trade
schemes reduce the quan