Countering the critics of Annie Leonard's `The Story of Cap and Trade'

By Patrick Bond

December 16, 2009 -- Eight million people viewed Annie Leonard's The Story of Stuff video since December 2007 and her new nine-minute Story of Cap and Trade has received 400,000 hits in the two weeks since its December 1 launch.

The film, produced by Free Range Studios, was developed in collaboration with the Durban Group for Climate Justice and Climate Justice Now! networks, which joined Climate Justice Action and other networks to put tens of thousands of activists on the streets of Copenhagen, London and dozens of other cities in recent days, demanding large carbon emissions cuts, the payment of ecological debt to climate victims and the decommissioning of carbon markets.

But critics abound, so what trends can we discern from the sometimes venomous feedback to Story of Cap and Trade, and what do these tell us about US and global climate politics? Let's consider three categories of critics:

  • libertarian climate change denialists;
  • Big Green groups and other carbon trading supporters; and
  • self-interested green capitalists.

To start, right-wing extremists are easiest to dismiss because they deny that climate change is a product of human/economic activity -- but there's a schizophrenic double agenda. For although they're pro-business, libertarians like Fox TV's Glenn Beck oppose market-based cap-and-trade schemes.

The most dangerous, Oklahoma Senator Jim Inhofe, denies ``that we're going to pass a cap-and-trade or we're going to do something on emissions reduction'', as he told the rightwing NewsMax agency on December 13.

Australian climate denialists now control the official opposition party in that Country, having overthrown its leader last month due to his cap-and-trade endorsement, in the process halting Australia's proposed emissions trading scheme.

Those of us fighting carbon markets certainly don't want alliances with cretins like Inhofe or intrepid videoblogger Lee Doran. After a clumsy rebuttal to The Story of Stuff, Doran offered another zany video-attack, in which he first agrees with the demolition of cap and trade, but then replies to Annie's charge that rich-world overconsumption victimises those least responsible for global warming:

Annie: Did you know that in the next century, because of the changing climate, whole island nations could end up underwater?

Lee: Yes, and islands will emerge from the water too, it's part of the natural cycle of the planet (minute 6).

Enough said about flat-earth libertarian ideologues.

Pro-market `Big Greens'

In the second group we find both pro-market ``green'' ideologues i.e., ``always find a market solution for a market problem!'' -- and well-meaning environmental advocates operating under conditions not of their own choosing within Washington's adverse balance of forces.

From at least 1997, when Al Gore shoved cap and trade into the Kyoto Protocol with the soon-to-be-broken promise that Washington would then endorse the climate treaty, many greens who earlier criticised market solutions concluded that the market was the only game in town, due to prevailing power relations.

But instead of trying to change those power relations, most of Washington's ``Big Green'' groups held their noses and went to work expanding carbon trading from London to the Chicago Climate Exchange, joined by like-minded academics and green policy wonks.

Along the way some turned eco-egotistical about their chosen trade. Eric de Place of Sightline Institute takes the policy critique personally: ``All these years that tens of thousands [sic] of folks like me have worked long hours at low pay (or no pay) to hash out a workable and effective climate policy and it turns out that our purported allies like Leonard would rather paint us as duplicitous bankers in pin-striped suits.''

Notwithstanding the long underpaid hours hustling cap and trade -- wasted, if judged by the subsequent evidence of carbon market failures -- de Place's injured tone is misplaced. As Annie did in fact acknowledge, ``Some of my friends who really care about our future support cap and trade. A lot of environmental groups that I respect do too. They know it's not a perfect solution and don't love the idea of turning our planet's future over to these guys, but they think that it is an important first step and that it's better than nothing.''

However, as the film demonstrates, carbon trading is not better than nothing, it's far worse than nothing. As top climate scientist James Hansen insisted in the New York Times on December 7, a US Senate bill or Copenhagen deal based on cap and trade would be indeed worse than no bill, no deal: carbon trading ``actually perpetuates the pollution it is supposed to eliminate''.

Ideologically, the market environmentalists risk sliding down a dangerous slope. For instance, amongst conservationists in both southern Africa (where I live) and Seattle (where de Place lives) this question has been posed: should markets be relied upon to preserve threatened wildlife, even endangered species?

In the African case, the challenge involves rhinos and elephants whose ivory tusks attract murderous poachers seeking riches in east Asian aphrodisiac markets. Poachers have reduced the big animals' populations dramatically in recent decades. In the North American Pacific Northwest, instead of aphrodisiacs, macho trophy hunters seek coastal grizzly bears for their fireplace mantels.

Market environmentalists react with a simple formula, which -- to quote Zimbabwe President Robert Mugabe -- reduces life to a commodity: ``They must pay to stay''. Mugabe and his allies seduce hunters to visit Zimbabwe in order to maintain a ``sustainable'' herd for the killing pleasure of rich tourists (not ordinary Zimbabweans' viewing pleasure).

De Place, too, defends the trophy industry: ``I'm not sure that hunting is bad for the species being hunted'' ( -- and for a rebuttal by the Raincoast Conservation Foundation, see

Grist's `pro-market panic'

David Roberts of the environmental website Grist also suffers pro-trading panic, calling the The Story of Cap and Trade ``the perfect representation of all the confusion and misplaced focus that plagues the green left right now''. In contrast, he confesses, ``I'm generally viewed among greens as a defender of cap-and-trade-or, in the less charitable version, a defender of the `party line', a shill for the administration, a sell-out `insider', whatever.''

Quite. David Roberts cannot defend the US and EU cap-and-trade systems' free pollution allowances and billions of tonnes of offsets, rebutting that we should criticise not carbon markets, simply prevailing legislation. But the dreadful US Waxman-Markey and Kerry-Boxer carbon-trading bills were complemented in mid-December by Senator Joe Lieberman -- ``This is the market-based system for punishing polluters previously known as `cap and trade'" -- to now include offshore drilling for oil and natural gas, nuclear energy and ``clean coal'' scamming.

Another new bill offered by Senators Maria Cantwell and Sue Collins last week was endorsed by de Place and his colleague Alan Durning even though it has only a 4% emissions-reduction target for 2020 from 1990 levels. Go figure, the author of the great 1992 anti-consumption book How Much is Enough?, Durning, now calls this irresponsibly low target ``solid''.

Ideally Kerry, Lieberman et al will be punished by Washington's gridlock, as the bills suffocate in Capitol Hill's corporate pollution -- a good thing, since their death would at least preserve the existing Clean Air Act, which all the main legislators except Cantwell-Collins threaten to gut.

Why markets are bad for the environment

Grist's David Roberts grows yet more defensive on matters of principle: ``I don't know why the green left has decided that markets are bad, in and of themselves, but it seems both politically unwise and substantively thin.''

He doesn't know why? Only a year after the world's worst market failure in recorded history, with global trade and financial indicators far lower after 18 months than a similar period in 1929-31!

Aside from concern about the self-destructive tendency of financial markets which host carbon trading (witness the EU Emissions Trading Scheme collapses in April 2006 and October 2008), the green left offers many substantively thick arguments why business environmentalism is flawed, and why commodifying natural resources -- like the air, in carbon trading -- generates systemic market failures.

For example, Africa's greatest political economist, Samir Amin, has just penned a damning attack on environmental markets, as has University of Oregon professor John Bellamy Foster: The Ecological Revolution: Making Peace with the Planet. Either can assist Roberts to plug the gaping holes in his pro-market consciousness.

Roberts doesn't seem to understand the severe dangers associated with an anticipated US$3 trillion in carbon trades by 2020, which will become the basis for further trade in financial derivatives, for he derides the The Story of Cap and Trade's warning about Wall Street speculation: ``[Annie] Leonard et al. seem instead to have decided that `market Goldman Sachs derivatives bugga bugga!' suffices.''

But Roberts, de Place and NRDC policy director David Doniger dare not trash the film's proposed solutions, such as stronger EPA regulatory enforcement and citizen activism (e.g. West Virginia mountaintop defence). There is greater potential to push the EPA into action -- in spite of misgivings by NewEnergyNews' Herman Trabish -- than to win legislation regulating carbon within ill-functioning, untransparent financial markets, in which ``too big to fail'' deregulatory freedom was amplified by Bush-Obama's 2008-09 bailouts.

Green capitalists

The third critical group of The Story of Cap and Trade includes green technocrats with financial self-interest. That may explain why at least one of them -- Adam Stein from TerraPass -- is so very cross, absurdly entitling his attack on the film, ``Why does Annie Leonard hate the environment?'', and another is carbon consultant Gay Harley.

Stein claims, ``cap and trade and carbon taxes are functionally equivalent policies'' -- but they're not. As James Hansen points out, carbon fees would easily withstand the scamming and price volatility so notorious in the carbon markets.

Ultimately, for Stein, ``one criterion clearly stands above all others: which policy actually stands a chance of passage in the US Congress?''. Unmentioned, for obvious reasons (the US Congress being a wholly owned subsidiary of big business) is that a carbon trading policy only enjoys the ``strong support'' of a meagre 2% of the US voting population, who ``favor a carbon tax over cap-and-trade by nearly two-to-one'', according to a Hart Research survey.

But given Washington's adverse power relations, a genuine climate policy must avoid the corporate-ruled Congress for now, and instead focus on command/control by the EPA. (To be sure, a stronger EPA would also rule many of TerraPass's own projects -- especially those methane-electricity landfill conversions that undermine zero-waste strategies -- as unworthy of green investment.)

Of all The Story of Cap and Trade's supposed errors, says Stein, ``my favorite for sheer chutzpah, if not for actual importance, is when Leonard dings Kyoto because `energy costs jumped for consumers'". But Stein may want to look at what European consumers now see: no net greenhouse gas emissions reductions on the one hand, and on the other, massive criminality in the EU's carbon trading scheme (Europol estimates 5 billion euros have been stolen in tax fraud, as just one example), alongside regressive energy price increases (the poorest suffer a much higher burden of expenses than the wealthy, and are least able to make the transition to the post-carbon economy).

So when the film refers to higher EU energy costs, this is not chutzpah, it's critical realism. No one more than Annie Leonrad is committed to raising consumption costs appropriately so as to deter waste; Story of Stuff's viewers learned of unaccounted-for eco-social externalities that should be internalised in her $4.99 radio, for instance.

Actually, the most telling contribution to the critiques of our cap-and-trade critique comes from an unlikely source: Charles Krauthammer. The despicable neocon columnist fused all three hostile narratives when he wrote, on December 11, against the EPA: ``Congress should not just resist this executive overreaching, but trump it: Amend clean-air laws and restore their original intent by excluding CO2 from EPA control and reserving that power for Congress and future legislation. Do it now. Do it soon. Because Big Brother isn't lurking in CIA cloak. He's knocking on your door, smiling under an EPA cap.''

Sorry, the big brother who so frightens Krauthammer is far bigger than a beleaguered Washington environmental agency and far more dangerous to corporate profits than pro-market ``green'' critics of The Story of Cap and Trade actually comprehend: simply, a new global movement known as Climate Justice.

[Patrick Bond is a content advisor to The Story of Cap and Trade and has written widely on the climate crisis. This was originally a ZNet commentary. It is posted at Links International Journal of Socialist Renewal with Bond's permission.]

Submitted by Derek Bolton (not verified) on Fri, 12/18/2009 - 09:22


I don't fit into any of Patrick Bond's categories. I find Leonard's analysis simplistic. It demonises cap and trade in general because of flaws in specific implementations, without recognising that the same flaws can arise just as easily in the alternatives. In some cases, the flaw is precisely that it is not a pure cap-and-trade system, such as free permits.
Wrt international offsets, such as reducing deforestation, it is clear that less logging in third world countries is a very important part of what must be done, and the first world should be expected to help pay for this. The only question is how to do this in a way which is fair and does not let the first world get away without reducing its own emissions. Again, the failings in that area in REDD are not inherent in C&T, and can arise in any architecture.
The real tragedy of reactions like Leonard's is that they waste time. They distract from the key issue of fixing the holes in the ETS; they encourage rival political parties to propose non-C&T alternatives as a delaying tactic; and if those non-C&T proposals ever get fleshed out we'll find they're full of the same holes and we'll be back where we started, just far too late.

The film tackles permit giveaways and corrupt offsets as two of the 'devils', and you think these can be reformed. I don't know the Oz details but the US legislation - Waxman-Markey and Kerry-Boxer - has both these features. So if you are serious about fixing not nixing carbon trading, how can you call this consciousness-raising effort a waste of time? Is there any other shout-out about these problems reaching hundreds of thousands of US viewers?

As to your general support for a market solution, your comment does not grapple with the real crisis of markets, whether in a fictitious commodity - the right to pollute the air - or the financial markets within which carbon trading is hosted. Are you really so comfortable with the World Bank, Enron, Goldman Sachs and JP Morgan characters who are so central to this racket?

We know, as well, that the US population - possibly the world's most reactionary - still favour a carbon tax over cap-and-trade by 2 to 1, so I think it really is your team that's wasting time, rather than working with the democratic spirit and getting command-and-control solutions (the EPA cap we suggest in the film) plus carbon fees plus the sorts of excellent direction action we've been inspired by in Oz uranium digs or Newcastle coal transport. (You're raising a red herring with talk of 'rival political parties' in grid-locked national legislatures, when there's so much to be done directly, prior to the point when - after the balance of forces improves - we can all win better national and maybe global laws/treaties.)

In sum, that's where time should be spent - keeping your coal in the hole and getting your enviro agency to regulate away pollution - instead of doing deals with big capital so that the mythical market solution to a market problem can kick in... one day... when we actually need the problem to be addressed at its foundations right away.

Submitted by Tony Maine (not verified) on Fri, 12/18/2009 - 16:01


I would suggest that the more complex some algorithm is, whether it be implemented as an ETS, tax or whatever, the less likely it will be to work under conditions where virtually all the implementers have so much to gain through its failure. I grant that pretty well any system to limit carbon dioxide emissions is going to work if everyone involved is committed to reducing carbon dioxide emissions - but what if they are not, as is the case with most fossil fuels? How effective will some complicated cap and trade arrangement be at coercing big business with massive resources to deploy at circumventing the provisions? In fact, the more complicated it will be, the more loopholes will exist, and the whole arrangement achieves nothing.It will be far more financially effective for the fossil industry to rort the legislation with armies of lawyers and accountants than to abide by it. Keep it simple! At least a tax MIGHT work. I do not believe cap and trade ever will.