RSS- SDI 2008 Cap and Trade Aff

Cap and Trade Aff- Wave 4.0
**Counter Plans**...........................................................................................................................................................................2 AT: Japan CP....................................................................................................................................................................................2 Ext. Perm Solves/Not Link..............................................................................................................................................................3 AT: States CP....................................................................................................................................................................................4 AT: 50 State Uniform Fiat Bad.........................................................................................................................................................5 AT: Do a 100% Auction- CP............................................................................................................................................................6 AT: Do a 100% Auction- CP............................................................................................................................................................7 AT: Grandfathering Bad Turns.........................................................................................................................................................8 AT: Grandfathering Bad Turns.........................................................................................................................................................9 **Das**..........................................................................................................................................................................................10 AT: Japanese Competitiveness DA................................................................................................................................................10 Ext. Competitiveness Down...........................................................................................................................................................11 AT: Federalism DA........................................................................................................................................................................12 Ext. Doesn’t Preclude State Action................................................................................................................................................13 **Ks**...........................................................................................................................................................................................14 AT: Eco Management K/Capitalism...............................................................................................................................................14 AT: Eco Management K/Capitalism...............................................................................................................................................15 AT: Eco Management K/Capitalism...............................................................................................................................................16 AT: Eco Management K/Capitalism...............................................................................................................................................17

Notes: Please Insert a few things into each of these blocksa) Federalism DA- Insert offense from the Federalism File (Aff section)- Either link or impact turns, your choice. I think impact turns are prob better. b) Eco Management K- This is a very good start- PLEASE insert some offense, in the form of impact turns to capitalism from the file.


RSS- SDI 2008 Cap and Trade Aff
**Counter Plans**

AT: Japan CP
1. Perm do both- Gets double solvency. International linkages allow for them to work together. 2. US Key- Couple of Warrantsa) Our Diringer evidence indicates that the United States is key to getting the Bali initiative off the ground, garnering international support for global emissions reductions is key to slowing global warmingThe impact is extinction- thats our Henderson evidence. b) They can’t solve for our economy advantage- Japan wont be able to increase US competitiveness, nor will they be able to solve for US economic decline- the impact is global nuclear war- that’s mead. 3. Perm solves- US and Japanese Cooperation are key to the Japanese Economy
Arvizu, 6/12/08
Mr. Chairman, (Alexander A., Deputy Assistant Secretary for East Asian and Pacific Affairs, “U.S.-Japan Relations: Partnership and Progress”,

the United States and Japan are the world’s largest economies, together generating over a third of global output. We owe much of our prosperity to our bilateral economic relationship. Japan and the United States exchange the equivalent of $760 million in goods and services every day; Japanese companies in the United States employed 613,500 American workers in 2005; and U.S. firms provided jobs for over 242,000 Japanese workers. Our economic relationship is more cooperative and less confrontational than in the past. We recognize that to sustain productive, growing domestic economies and maintain a strong international system based on free markets, opportunity, and effective and responsible economic governance, we need to work together. We are global leaders, and we are finding more and more that our engagement is global in scope as we tackle issues like energy security and climate change; protect intellectual property rights; deepen and strengthen the Asia-Pacific economic
community; and address critical development needs in Iraq, Afghanistan, Africa and elsewhere. To alleviate the burden of sharply higher food prices on the world’s poor, in May the United States announced substantial new food aid. We also agreed that Japan could release to countries in need a portion of the rice imported under WTO Uruguay Round commitments on an exceptional basis this year. We believe this will help calm the international rice market, and we continue to discuss the causes of these high food prices.


RSS- SDI 2008 Cap and Trade Aff

Ext. Perm Solves/Not Link
(__) Perm solves and doesn’t link to the DA- Cooperation is happening now, and there is ZERO impact
AP, 6/13/08
(“Japan official says US, Japan to work on tackling rising oil, food prices”;

- Japan is closely working with the U.S., its most important ally, to tackle soaring oil and food prices, the main topics of an international meeting starting Friday, Japan's finance minister said. "We need to coordinate our actions closely because of the many risk factors," Finance Minister Fukushiro
OSAKA, Japan (AP) Nukaga told reporters after meeting U.S. Treasury Secretary Henry Paulson in Osaka. The officials are in Osaka for a two-day gathering of finance ministers from the Group of Eight industrialized nations, where

they were to discuss helping developing nations

fight global warming,

aid for Africa and possibly exchange rates. Nukaga declined to comment on the specifics of his conversation with Paulson about currenies but acknowledged the topic came up. "I decline to comment as I usually don't comment on foreign exchange matters," he said at an Osaka hall, adding that it was unclear whether currency matters will be on the official agenda at the G-8 meeting. Weakness in the dollar has been a concern lately. It has contributed to the surge in oil prices because some traders invest in oil as a hedge against inflation and a slumping greenback. The dollar has recovered against the yen and euro after Paulson warned earlier this week that he isn't ruling out interventing in the currency market to stabilized the currency. U.S. Federal Reserve Chairman Ben Bernanke also helped lift the

work was going "smoothly" on an international initiative for Climate Investment Funds being administered by the World Bank to provide money for developing nations to battle global warming.
dollar by suggesting the Fed is prepared to raise interest rates to fight inflation. Nukaga said

(__) US and Japan are cooperating on Up stream permits now
US Department of Energy, 2007 (“United States-Japan Cooperation on Energy Security”, January 9,

The United States and Japan share concerns about impediments in energy producing countries to the significant new investment needed to meet world wide growing energy demand. Both sides will therefore continue to encourage energy producing countries
Improving Investment Climate in Energy Producing Countries: to improve their investment climate in the ways that were endorsed by the G8 Leaders in the St. Petersburg Plan of Action on Global Energy

the United States and Japan will endeavor to enhance understanding that foreign investments in upstream sectors are beneficial for energy producing and consuming countries alike; to encourage transparent, equitable, stable and effective legal and regulatory frameworks; and to emphasize the obligation of all countries to uphold the sanctity of contracts.
Security. Specifically,


RSS- SDI 2008 Cap and Trade Aff

AT: States CP
(__) States fail at Tradeable Permits- Impose externalities on other states, and cannot correct the problems when other states impose externalities on them- Federal government Key. Verbon and Withagen 2005 (Harrie Department of Economics at Tilburg University and Cees Tilburg University, “Tradeable Emissions
Permits In a Federal System” CESifo Working Paper, June

In the US there already exists a nation-wide TEP system for sulphur-dioxide. For an evaluation of 2 SO allowance trading program see Schmalensee et al. (1998) and Stavins (1998). These federal systems will operate in the way described above, if the individual states just pursue profit maximisation on the part of their (polluting) firms. Obviously, their objective is much broader, including other welfare aspects such as consumer surplus. As is well known, welfare maximization at the state level does not have to coincide with welfare maximization at the nation-wide level. A state fails to take account of the externalities it imposes on the residents of other states, while on the other hand, states are not able to correct for externalities other states are imposing upon their residents. The taxcompetition literature concludes in such cases that the federal government should correct inefficient local policies by centralizing the decision power, or by introducing appropriate corrective grants
Europe and the US, and a TEP system is currently being implemented for the entire EU for greenhouse gas emissions. (see Wilson, 1999, for an overview of this literature).


RSS- SDI 2008 Cap and Trade Aff

AT: 50 State Uniform Fiat Bad
50 State Fiat good1. Its reciprocal- Aff uses multiple actors in their plan. There are many different entities which have to work together to enact the plan- neg should get the same lee way on fiat questions. 2. The Alternative is worse- It would be infinitely worse if the Aff had to research 50 different state actions. It would explode the topic and make it impossible for the Aff to read a DA to any one of the actions. 3. States CP good- Sets a functional limit on the topic4. Most Real World- the 50 states can (and have) enacted policies as one uniform body. They use the mechanism of National Associations of Attorney Generals COLUMBIA LAW REVIEW, 2001 (December, p. 208)
Cooperation among the attorneys general is facilitated by the nature and activities of NAAG, which provides attorneys general with a ready-made infrastructure for pursuing multistate litigation. Historically, NAAG has been a nonpartisan organization coordinating the activities of its member attorneys general through several meetings each year.

Or the National governor’s Association NGA 2008 (National Governor’s Association, “Securing a Clean Energy Future,” the National Governors Association (NGA) is the collective voice of the nation’s governors and one of Washington, D.C.’s most respected public policy organizations. Its members are the governors of the 50 states, three territories, and two commonwealths. NGA provides governors and their senior staff members with services that range from representing states on Capitol Hill and before the Administration on key federal issues to developing and implementing innovative solutions to public policy challenges through NGA’s Center
Founded in 1908, for Best Practices.


RSS- SDI 2008 Cap and Trade Aff

AT: Do a 100% Auction- CP
( ) They can’t prove that revenue will be recycled back into the economy The cplan does not fiat this – and it’s just as likely that Bush would spend it on Iraq. This means that they solve none of their economy arguments. ( ) Doesn’t solve warming – two reasons: a) Rollback -- Full auction causes rollback of other warming-related progress. (Jim Rogers is chairman, president, and CEO of Duke Energy Corp – Power Magazine – July - This rate shock may result in consumers demanding a reversal of efforts to address climate change, a result our environment cannot afford. Some legislators are even calling for a full auction of allowances, which would punish these consumers even more and increase rates in these regions between 30% and 63%. b) Revenue-Recycling Rogers ‘8

Only the Aff recycles the revenue back into a green safety valve – that’s the 1AC Stavins card. The Green Safety valve is crucial to solve warming
( ) Doesn’t solve economy – two reasons: a) Studies prove cplan would take twice as much money out of the US economy as the the plan EIA ‘7
(Energy Information Agency -- Energy Market and Economic Impacts of a Proposal to Reduce Greenhouse Gas Intensity with a Cap and Trade System -- Report #: SR-OIAF/2007-01 --January --

GDP and consumption impacts in the Full Auction case are substantially larger than those in the Phased Auction case.
In 2030,

Relative to the reference case, discounted total GDP (in 2000 dollars) over the 2009-2030 time period in the Full Auction case is $462 billion (0.19 percent lower), while discounted real consumer spending is $483 billion (0.29 percent) lower.

(0.69 percent) lower,

projected real GDP in the Full Auction case is $94 billion (0.41 percent) lower than in the reference case, while aggregate consumption is $106 billion almost twice the estimated consumption loss in the Phased Auction case. These results reflect the substantially higher level of auction revenues

under the Full Auction case, which, by assumption, are not re-circulated into the economy beyond the $50 billion in expenditures from the Climate Change Trust Fund. Because these estimated impacts could change significantly under alternative revenue recycling assumptions, these results do not imply a general conclusion that a Phased Auction will necessarily result in lesser impacts on GDP and consumption than a Full Auction.

b) jacks firms with contract obligations

Izzo ‘7


Moving too quickly to a full auction system may also create problems for facilities with contract obligations that would prevent them from recouping auction costs until their contracts could be renegotiated. These economic realities suggest that we are best served by transitioning to a full auction process over a reasonable period of time. PSEG supports
auctioning 25% of the allowances at the outset of the program and transitioning to full 100% allowance auction over the course of 10 years. In the short term, I would advocate using an output based allocation for allowances as a tool to encourage power plant efficiency and the deployment of low and zero carbon technologies. Auction proceeds can be used to fund research and development into advanced energy technologies and to compensate households and companies that are disproportionately burdened by the costs of a cap-and-trade program.


RSS- SDI 2008 Cap and Trade Aff

AT: Do a 100% Auction- CP
( ) 100% Auction scheme would damage the US economy, partial grandfathering solves Stavins ‘7
(Robert N. Stavins is the Albert Pratt Professor of Business and Government at the John F. Kennedy School of Government, Harvard University, and Director of the Harvard Environmental Economics Program -- A U.S. Cap-and-Trade System to Address Global Climate Change -- DISCUSSION PAPER – Oct 13th -

The cap-and-trade system would create a new commodity, a CO2 allowance, which would have value because of its scarcity: only as many allowances would be issued as is consistent with the emissions target. The government could distribute allowances for free or auction them. This proposal recommends an allowance allocation mechanism that combines auctions with free distribution, with auctions becoming more important over time. The aggregate value of allowances in a nationwide system would be substantial. Indeed, if all allowances are auctioned, annual auction receipts would amount to a significant share of federal revenue.31 For firms needing to buy auctioned allowances, total allowance costs would significantly exceed the cost of emissions reductions that would meet a modest cap. The reason is that under an economy-wide emissions cap that reduces nationwide emissions by 5 percent, for example, regulated firms would incur costs associated with reducing those emissions but would have to purchase allowances for the remaining 95 percent of their emissions. The magnitude of these firm-level costs indicates that the choice of allocation method (auctioning versus free distribution) and the use of auction revenue can have important distributional implications. By contrast, the allocation choice does not affect the achievement of the emissions targets, and—as emphasized above—the allocation issue is independent of the point of regulation. Indeed, since alternative points of regulation lead to the same ultimate distribution of economic burdens, there is no economic rationale for tying allocation choices to the point of regulation. For example, under an upstream cap, it would be possible to distribute allowances for free to downstream energyintensive industries that are affected by the cap even though they are not directly regulated by it. This is one approach to compensating those industries for the impact of a climate policy, since they could then sell the allowances to firms directly regulated under the cap.


RSS- SDI 2008 Cap and Trade Aff

AT: Grandfathering Bad Turns
(should be read at the bottom of the 2AC blocks versus the “100% auction cplan)
( ) Their links don’t assume a hybrid distribution scheme Their grandfathering bad arguments ignore that we do a 50% auction – solving back most of their offense. ( ) Partial grandfathering keeps energy prices lower and helps customers – their econ arguments are backwards EIA ‘7 (Energy Information Agency -- Energy Market and Economic Impacts of a Proposal to Reduce Greenhouse Gas Intensity with a Cap and Trade System -- Report #: SR-OIAF/2007-01 --January - As specified in the request for the analysis, EIA considered both a Phased Auction case, which allocates allowances as specified in the proposal, and a Full Auction case, in which all allowances are assumed to be auctioned beginning in 2012. Because they share the same emissions targets and safety valve prices, the energy sector impacts in the Phased and Full Auction cases are very similar. The only areas where the impacts in the two cases differ are for electricity prices and the economic impacts associated with collection and use of revenue from the sale of allowances. Several
additional sensitivity cases examine the impacts of higher and lower safety valves and limiting the use of emission reduction credits, or offsets, from non-covered entities. The proposal and its variants were modeled using the National Energy Modeling System and compared to the reference case projections from the Annual Energy Outlook 2006 (AEO2006).2 The analysis presented in this report builds on previous EIA analyses addressing GHG limitation, including earlier EIA reports requested by Senator Bingaman3, Senator Salazar4, and Senators Inhofe, McCain, and Lieberman.5 All of the analysis cases incorporate the economic and technology assumptions used in the AEO2006 reference case. While increased expenditures for research and development (R&D) resulting from the creation of the Climate Change Trust Fund are expected to lead to some technology improvements, a statistically reliable relationship between the level of R&D spending for specific technologies and the impacts of those expenditures has not been developed. Furthermore, the impact of Federal R&D is also difficult to assess, because the levels of private sector R&D expenditures usually are unknown and often far exceed R&D spending by the Federal Government. However, the recent reports for Senators Bingaman and Salazar include additional sensitivity analyses on the assumptions made regarding the availability of GHG emissions reductions outside the energy sector and the pace of advances in technology used to produce and consume energy. The report for Senators Inhofe, McCain, and Lieberman also examines the economic implications of possible alternative approaches to recycling revenues collected by government under a cap-and-trade program in which significant amounts of government revenue is collected from allowance auctions. Alternative assumptions in these areas can have a major impact on the results obtained, and the insights from those prior sensitivity cases would also be applicable to the proposal analyzed this report. Readers interested in how the results reported below might be affected by different assumptions in these areas are encouraged to review the earlier reports. The modeled impacts of the proposal are summarized below. Reported results apply for the $7 Phased Auction case, unless otherwise stated. Energy and allowance prices are reported in 2004 dollars for compatibility with AEO2006. Macroeconomic time series such as GDP and consumption expenditures are reported in 2000 chain-weighted dollars to maintain consistency with standard reports of U.S. economic statistics. Projections of the aggregate value of allowances and auction revenues and fiscal impacts on the budget surplus are reported in nominal dollars, as are deposits relating to the Climate Change Trust Fund. Results Emissions and Allowance Prices * The proposal leads to lower GHG emissions than in the reference case, but the intensity reduction targets are not fully achieved after 2025. Some regulated entities would opt to make safety-valve payments beginning in 2026, the year in which the market value of allowances is projected to reach the safety-valve level (Table ES1). With the higher safety-valve prices in the $9 Phased Auction sensitivity case, the intensity targets are attained through 2029. * Relative to the reference case, covered GHG emissions less offsets6 are 562 MMTCO2e (7.4 percent) lower in 2020 and 1,259 MMTCO2e (14.4 percent) lower in 2030 in the Phased Auction case. Covered GHG emissions grow by 24 percent between 2004 and 2030, about half the increase in the reference case. * In the early years of the program, when allowance prices are relatively low, reductions in GHG emissions outside the energy sector are the predominant source of emissions reductions. In 2020, reductions of GHGs other than energy-related CO2, estimated based on information provided by the Environmental Protection Agency, account for nearly 66 percent of the total reductions. By 2030, however, the higher allowance prices lead to a significant shift in energy decisions, particularly in the electricity sector, and the reduction in energy-related CO2 emissions account for almost 58 percent of total GHG emissions reductions. * An allowance allocation incentive for carbon sequestration, available only in the Phased Auction case, is projected to result in an additional emissions impact of 296 MMTCO2e in 2020 and 311 MMTCO2e in 2030, or about 4 percent of covered emissions. * In 2004 dollars, the allowance prices rise from just over $3.70 per metric tons CO2 equivalent in 2012 to the safety valve price of $14.18 metric tons CO2 equivalent in 2030. Energy Markets * The cost of GHG allowances is passed through to consumers, raising the price of fossil fuels charged and providing an incentive to lower energy use and shift away from fossil fuels, particularly in the electric power sector. * When allowance costs are included, the average delivered price of coal to power plants in 2020 increases from $1.39 per million Btu in the reference case to $2.06, an increase of 48 percent. By 2030 the change grows from $1.51 per million Btu in the reference case to $2.73 per million Btu, an increase of 81 percent.

* Electricity prices are somewhat lower in the Phased Auction case than in the Full Auction case because the Phased Auction provides a portion of the allowances to the electric power sector for free, a benefit that is passed on to ratepayers where the recipients are subject to cost-of-service regulation.
Electricity prices in 2020 are 3.6 and 5.6 percent higher than in the reference case in the Phased and Full Auction cases, respectively. In 2030, electricity prices are 11 and 13 percent above the reference case level. Electricity price impacts are likely to vary across states and regions due to differences in State regulatory regimes and in the fuel mix used for generation in each area.

( ) the hybrid combo solves all of their offense while avoiding the worst economic impacts. Center for Clean Air Policy ‘2 (Allowance Allocation -- Who Wins and Loses Under a Carbon Dioxide Control Program? -- Auctioning all allowances results in losses in the coal industry of 64 percent and in the electricity industry of four percent. The iron and steel sector’s equity value is unaffected. For these industries, an auction leads to lower equity values than grandfathering because they receive no wealth transfer in the form of free allowances. As mentioned before, the question of who gets allowances can be separated from who directly participates in the trading system. Allowances can be given so that each affected industry, whether regulated directly or not, is held harmless in terms of its equity value. By combining grandfathering with an auction, a carbon cap and trade program can be a win-win-win policy: industry equity value can be maintained, auction revenues can be recycled to help offset the macroeconomic impact of the control program, and the risk of climate change can be significantly reduced. Grandfathering Combined with Auction and Revenue Recycling Leads to “Win, Win” CRA found that giving away only nine percent of total allowances is enough to maintain each of the five energy sectors’ equity value For example, giving the coal industry 3.2 percent of all allowances is enough to hold it harmless. The electricity sector needs only 2.4 percent of allowances, and the iron and steel sector needs no allowances.4 One significant economic advantage of targeted grandfathering to maintain equity value is that most allowances are available to auction. The auction revenue can be used to cover any shortfall in the government’s revenues,5 to reduce marginal tax rates, or to assist in other public purposes. CRA found that, compared to auctioning all allowances, targeted grandfathering results in a modest increase in welfare loss, a modeling measure that is akin to the gross domestic product (GDP). Full auctioning results in a 0.46 percent welfare loss, while a combined auction (91 percent) / grandfathering (nine percent) allocation leads to a 0.51 percent welfare loss. Full grandfathering on the other hand, results in a 0.82 percent welfare loss, which is 80 percent greater than the loss with full auctioning.


RSS- SDI 2008 Cap and Trade Aff

AT: Grandfathering Bad Turns
( ) A hybrid system of auctioning and grandfathering is the best solution. Stavins ‘7 (Robert N. Stavins is the Albert Pratt Professor of Business and Government at the John F. Kennedy School of Government,
Harvard University, and Director of the Harvard Environmental Economics Program -- A U.S. Cap-and-Trade System to Address Global Climate Change -- DISCUSSION PAPER – Oct 13th -

Allowances under the system would be allocated through a combination of free distribution and open auction. This is intended to balance, on the one hand, the legitimate concerns of those who will be particularly burdened by this (or any) climate policy with, on the other hand, the opportunity to achieve important public purposes with funds generated by the auctions. The share of free allowances would decrease over time as the private sector adjusts to the carbon constraints, with all allowances being auctioned after twenty-five years. ( ) A hybrid allocation scheme is the best overall option. Stavins ‘7 (Robert N. Stavins is the Albert Pratt Professor of Business and Government at the John F. Kennedy School of Government,
Harvard University, and Director of the Harvard Environmental Economics Program -- A U.S. Cap-and-Trade System to Address Global Climate Change -- DISCUSSION PAPER – Oct 13th -

Given these important differences in the implications of free allocation versus auctioning, the best alternative is to begin with a hybrid approach wherein some (half in the present proposal) of the allowances are initially auctioned and the rest are distributed free to entities burdened by the policy, including suppliers of primary fuels, electric power producers, energy-intensive manufacturers, and particularly trade-sensitive sectors. The share of free allowances should decline over time until it eventually (after twenty-five years in the present proposal) reaches zero. The reason is that, over time, the private sector, including those industries with long-lived capital assets, will have an opportunity to adjust to the new system. Thus the justification for free distribution diminishes over time. In the short term, however, free distribution provides flexibility to address distributional concerns that might otherwise impede initial agreement on a policy. Meanwhile the portion of allowances that are initially auctioned will generate revenue that can be used for public purposes, including compensation for the program’s impacts on low-income consumers, public spending for related research and development, reduction of the federal budget deficit, and reduction of distortionary taxes. Why this particular pattern of a 50-50 initial allocation with phase-out of the free allocation over twenty-five years? The answer is that this time path is consistent with analyses of the share of allowances that would need to be distributed for free to compensate firms for equity losses. In a series of analyses that considered the share of allowances that would be required in perpetuity for full compensation, Bovenberg and Goulder (2003) found that a 13 percent share would be sufficient to compensate the fossil fuel extraction sectors. In a scenario consistent with the Bovenberg and Goulder study, Smith, Ross, and Montgomery (2002) found that free distribution of 21 percent of allowances would be needed to compensate primary energy producers and electric power generators.37 The time path recommended here for an economy-wide program—half of allowances initially distributed free, with this share declining to zero after 25 years—is equivalent in terms of present discounted value to perpetual allocations (like those previously analyzed) of 15 percent, 19 percent, and 22 percent at real interest rates of 3, 4, and 5 percent, respectively. Hence the recommended allocation is consistent with the principle of targeting free allocations to burdened sectors in proportion to their relative burdens. It is also pragmatic to be more generous with the allocation in the early years of the program.


RSS- SDI 2008 Cap and Trade Aff

AT: Japanese Competitiveness DA
1. Their Link Evidence is JUST BADa) It does not mention alternative energy or tradeable permits, but only the auto industry- NONE of our advantages is based upon increasing auto industry competitiveness. b) its from 1995- MUCH has changed since then- not only in the Auto sector but also in the geopolitical system of competitiveness and industrialization. US no longer trades off with Japan. 2. Japanese Competitiveness Down Now
Bloomberg, 7/14/08
(“Japan Says Recovery Is `Pausing,' Keeps Assessment”,

The Japanese government kept its assessment of the economy unchanged after downgrading it last month, saying the expansion is showing signs of weakness. ``While the economic recovery appears to be pausing, weak movements are seen recently,''
the Cabinet Office said in Tokyo today in its monthly report for July.

Rising prices are reducing profits, making it difficult for companies to increase wages and hire employees. Consumer confidence dropped to the lowest on record last month after households reduced spending at the fastest pace since September 2006. ``Japan's economy is barely staying on the edge of a cliff,'' Economic and Fiscal Policy Minister Hiroko Ota said.
``There's a big risk that rising oil prices and material costs will affect capital spending and eventually consumer spending.''

3. No Link- US Competition does not Trade off with Japan
Krugman, 1994
(Paul, Prof. of Econ at MIT, Foreign Affairs, “Competitiveness: A Dangerous Obsession”,

International trade, then, is not a zero-sum game. When productivity rises in Japan, the main result is a rise in Japanese real wages; American or European wages are in principle at least as likely to rise as to fall, and in practice seem to be virtually unaffected. It would be possible to belabor the point, but the moral is clear: while competitive problems could arise in principle, as a practical, empirical matter the major nations of the world are not to any significant degree in economic competition with each other. Of course, there is always a rivalry for status and power, countries that grow faster will see their political rank rise. So it is always interesting to compare countries. But asserting that Japanese growth diminishes U.S. status is very different from saying that it reduces the U.S. standard of living, and it is the latter that the rhetoric of competitiveness asserts. One can, of course, take the position that words mean what we want them to mean, that all are free, if they wish, to use the term "competitiveness" as a poetic way of saying productivity, without actually implying that international competition has anything to do with it. But few writers on competitiveness would accept this view. They believe that the facts tell a very different story, that we live, as
Lester Thurow put it in his best-selling book, Head to Head, in a world of "win-lose" competition between the leading economies. How is this belief possible?


RSS- SDI 2008 Cap and Trade Aff

Ext. Competitiveness Down
Japanese Economic Competition Slowing
UPI, 7/14/08
(Business News, “Report: Japanese economic recovery pausing” , The Japanese government's July assessment of its economy Monday showed no change from its previous report, noting the recovery is stalling amid rising prices. "While the economic recovery appears to be pausing, weak movements have been seen recently," the Cabinet Office said in its July monthly economic report, which contained the same phrasing used the previous month's report, the Kyodo news service reported. The

The core consumer price index, which excludes food prices, jumped 1.5 percent in May from the same month of last year, the fastest such increase in 15 years. The July report said companies "have become all the more cautious,"
government report said prices have been "gradually on the rise." quarter ended June, Kyodo reported.

reflecting the central bank's latest Tankan quarterly survey saying business confidence among Japan's major manufacturers deteriorated in the

The government report said future Japanese exports will be influenced by the U.S. economy and emphasized the need to monitor inventory levels of items such as electronic parts and semiconductors. Japanese Economic Minister Hiroko Ota urged close monitoring
of inflationary pressures, saying consumer price rises were not caused by higher domestic demand but by external factors such as rising crude oil prices.

Japanese Manufacturers’ Confidence Low
NYT, 7/2/08
(“Japan: Manufacturers’ Confidence Falls”,

Confidence at major Japanese manufacturers has slumped to an almost five-year low and large corporations project a significant drop in profits for the half-year through September, a central bank survey showed. But other sections in the quarterly tankan report suggested pockets of strength have cushioned
Japan’s slowdown. The index for large manufacturers’ business sentiment fell to 5 in June from 11 in March. Although the figure represented the third straight quarterly drop and was the worst reading since September 2003, it was better than market expectations of 2 to 4 and remained above zero, meaning major manufacturers were marginally more optimistic than pessimistic.

Japanese Business Confidence At Five-Year Low
Daily Times, 7/2/08
(“Japan business morale sinks to five-year low”,

Confidence among big Japanese manufacturers sank to a five-year low in June and they responded to record commodity prices and slowing global growth with the tightest capital spending budgets since 2002. Investors had been expecting an even darker mood and seized on
signs of a slight recovery in the construction sector as an opportunity buy shares, sell bonds and increase bets on a rate rise by the Bank of Japan. That did little to change the overall picture. Companies were expecting profits to fall for the first time in seven years, the central bank’s

The mood among automakers, grappling with fallout from the credit crisis in the United States, darkened more quickly than at any time in a decade. The measure of input costs for non-manufacturers were the highest since comparable records began. “Sentiment in the construction-related sector bottomed out, helping to reduce the fall in the headline index,” said Junko Nishioka, a senior economist at ABN Amro Securities.
quarterly tankan corporate survey showed.


RSS- SDI 2008 Cap and Trade Aff

AT: Federalism DA
(__) Non U- Supreme Court is Upholding the right of the Federal Government to enact environmental policy. Simon 2007 (Christopher A. associate professor of political science University of Nevada, Alternative Energy: political, economic, and social
feasibility, p. 15-6 Online)

The Supreme Court has legitimized the national government role in creating and enforcing environmental quality policies. The recent U.S. Supreme Court opinion in Engine Manufacturers Association et al. v. South Coast Air Qualify Management District, el al. (2004) illustrates the Court's current stance on the role of the national government in shaping environmental and energy policy, in this case through the enforcement of uniform air quality standards. In this instance, the Court viewed Los
Angeles's requirement for bus and truck operators to use only locally approved low emission vehicles for transportation of individuals and goods

The Court has used judicial review to protect the national governments' power to enforce nationwide standards for environmental quality, which ultimately leaves it to the national government to create incentive structures to develop alternative energy through regulations limiting the use of hydrocarbon fuels or at least through tightening emissions standards. While some
within the county area as a preemption of the national government's regulation of interstate commerce. environmental public interest groups might view the Court's majority opinion as a “loss" because the justices largely rejected an aggressive local government pro-environment policy initiative, in the long term

the legal opinion protects and likely bolster, the national

environmental policy agenda.

(__) No Link- Permits Systems dont preclude state action. McKinstry 2007 (Robert B. Jr. is the Maurice K. Goddard Professor of Forestry and Environmental Resources Conservation, The Pennsylvania State University, Pacific McGeorge Global
Business & Development Law Journal v. 20, p. 67-8 Online)

Federal environmental laws have included numerous mechanisms to protect and to expand the state laws on which they were based. Typically, the laws do not seek to displace the state laws but to protect them by simultaneously creating a federal floor, providing for state primacy in the development of standards and implementation, and providing monetary assistance to state programs. Thus, most federal environmental permitting programs allow the state program to operate in lieu of the federal program so long as it is equivalent to the floor in the federal program.
States are often authorized to develop plans or standards in the first instance. In most cases, states are specifically authorized to adopt

states are left free to enforce their programs, but the federal government may step in where it appears that state inaction may be compromising the federal floor. These laws are thus
standards more stringent than the federal floor. Under these laws, designed to promote federalism by fostering state innovation and protecting this innovation with a floor.

(__) No Impact- States will step in to prevent usurpation of power by the Federal Government Caminker 2001 (Evan Law Professor, University of Michigan, 2001 ANNALS OF THE AMERICAN ACADEMY OF POLITICAL AND SOCIAL
SCIENCE, March, p. 88-9 Online) The allocation of significant regulatory authority to the states within a federal system is frequently defended as serving the following structural values: enhancing the responsiveness of government to the specific interests of members of a heterogeneous society, both by decentralizing decision making and by generating competition for a mobile citizenry; enabling states to act as laboratories experimenting with diverse solutions to economic and social problems; and stimulating the development of democratic skills and attitudes by increasing citizen participation in self-

the mere existence of states as independent institutions serves as a structural check against the risk that Congress will either assert power that does not lawfully belong to it or wield the power it does lawfully enjoy too frequently or indiscriminately. As observed by Alexander Hamilton, The State legislatures . . . will constantly have their attention awake to the conduct of the national rulers, and will be ready enough if anything improper appears, to sound the alarm to the people, and not only to be the VOICE, but, if necessary, the ARM of their discontent.
governance. Moreover,


RSS- SDI 2008 Cap and Trade Aff

Ext. Doesn’t Preclude State Action
(__) Federal Action does not prevent states from acting- it actually encourages states to act to supplement Federal action. Rich and White 1996 (Robert and William D., director of the Institute of Government and Public Affairs, and professor in the department
of economics, University of Illinois, Health Policy, Federalism and the American States , p. 9 )

In New York v United States (1992, 112 S.Ct.2408), which deals with low-level radioactive waste, Justice Sandra Day O'Connor, the author of the majority opinion, wrote that Congress may not simply "commandeer the legislative process of the States by directly compelling them to enact and enforce a regulatory program." She has developed a series of operating rules for dividing up the job between the federal and state levels of government: (1) Congress may not tell the states to comply with regulations without giving them the resources to do so; (2) Congress may provide inducements or incentives designed to encourage states to comply; (3) Congress may preempt the states so long as the federal government is willing to assume full financial responsibility; and (4) states may decide to go beyond the standards set by Congress (cited in Pfander 1993).


RSS- SDI 2008 Cap and Trade Aff

AT: Eco Management K/Capitalism
(__) Perm do both (__) Perm do plan and completely withdraw from the ideology of capital in every other instance. We get the right to clarify. a) Give us lee way on this permutation. When they describe how this alternative will function will be able to give them a better idea of how the permutation functions. b) Perm is theoretically legit- With ultra generics like the Capitalism K it’s the neg’s burden to prove why the particular action of their alternative is key. (__) The perm sets up a double bind- either a) the permutation solves the links to the criticism OR b) the alternative isn’t strong enough to over come the Status Quo/Links. (__) The Aff is the most ethical act- access to clean energy is a fundamental right – government intrusion into the economy is justified in this instance

Tully Postdoctoral Fellow of the ESRC Centre for the Analysis of Risk and Regulation and of the Law Department 2006 Stephen Northwestern University Journal of
International Human Rights Spring page lexis

The human rights paradigm also pursues the accountability of governments and others through the application of the rule of law. Persons or groups denied rights are entitled to access effective judicial and other remedies at national and international levels. n131 Victims of human rights violations are entitled to adequate reparations including restitution, compensation, satisfaction, and guarantees of non-repetition. National ombudsmen, human rights commissions, and similar institutions may be entrusted with addressing violations. To a similar end the private sector can be made more responsive to the needs of low-income urban households by increasing the latter's level of participation. n132 Although direct corporate accountability to their customers can be enhanced, legislative or policy measures crafted by governments could equally be
avoided. n133 Nevertheless, the private sector, under the human rights paradigm, is expected to contribute to realizing human rights. However, trend s toward direct corporate legal

an individual right affirms the obligations incumbent upon government. Governments have undertaken to promote universal respect for and observation of human rights and fundamental freedoms. n135 They accordingly become subject to positive or negative obligations to protect, promote, and provide each human right and to abstain from violations. Providing access to basic social services, including energy, is considered to be a fundamental responsibility of government. n136 This responsibility arises even when governments delegate functional roles to third parties. Notwithstanding market-oriented electricity sector reforms, "in
responsibility for violations, while discernable, remain underdeveloped. n134Further, all cases the State remains ultimately responsible for the delivery of electricity." n137 For example, the Electricity Corporation of Guyana is obliged to provide public services which are safe, adequate, efficient, [*534] reasonable, and non-discriminatory. n138 The New Zealand Electricity Commission is similarly expected to produce and deliver electricity to all consumers in an efficient, fair, reliable, and environmentally sustainable manner. n139 A human rights obligation enforceable against governments would maintain their active participation within deregulated electricity markets and, moreover, circumscribe permissible behavior.

(__) Doesn’t solve the aff- Capitalism is key to solve warming Whitman 8 (Janet, February 19, pg.
Global warming may soon get a saviour more effective than Al Gore and his doomsday Power-Point presentations: capitalism. The former U.S. vice-president, who was awarded the Nobel Peace Prize last year for his work on climate change, is credited with bringing widespread attention to the issue. But the huge moneymaking opportunity in going green will be the big driver that leads to the reining in of the release of greenhouse gasses, experts say. Money already is pouring into environmental initiatives and technologies in the United States. Experts expect investment in the area to explode over the next few years if, as anticipated, the government here imposes restrictions on the release of gases believed to be behind climate change. "Capitalism will drive this," said Vinod Khosla,
founding chief executive of Sun Microsystems and a longtime venture capitalist. Mr. Khosla, speaking on a panel at a recent investment summit on climate change at United Nations headquarters here, said getting

consumers to curb their energy use has never worked -- unless they've had a financial incentive. "If we make it economic, it will happen," he said. The expected government-mandated cap on carbon emissions already is fueling innovation. Venture capitalists, for instance, are investing in new technologies that would make cement -- a major producer of carbon emissions -- actually absorb carbon instead. Cement makers could practically give the product away and reap the financial reward from
government carbon credits.


RSS- SDI 2008 Cap and Trade Aff

AT: Eco Management K/Capitalism
(__) The Alt Fails- cannot produce a better world because it replaces one system of violence for another – this makes it difficult for them to produce a reason to risk the violence they endorse Robbinson, PhD, School of Politics U of Nottingham, 2004 (Andrew, ‘The Politics of Lack’, British Journal of Politics and International Relations, May)
The centrality of the idea of betrayal and of the revolution which 'commits suicide' reveals another crucial problem with the nihilistic variety of Lacanianism. Since the basic structure of existence is unchangeable and the purpose of an Act is to accept (not to change) it, Lacanian revolutionism must stop short of the claim that a better world can be constructed. To be sure, an existing master-signifier can be replaced with a new one, but the basic structure of existence—including, crucially, the central role of violence, antagonism and exclusion—is beyond question. Žižek's failure to supplement his radical existential claims and his radical posturing with a substantive radical politics is not, therefore, an accident, as is often assumed. It reflects an underlying conservatism apparent in even the most radical-seeming versions of Lacanianism. For such theories, the crucial point is the celebration of lack, and specific political issues are subordinate to this goal. Even the specific policies of existing regimes are acceptable if they can be reformulated in a manner compatible with a belief in the primacy of lack. To take a recent example, Žižek denounced the American invasion of Afghanistan, but his demand for an alternative stops at the limits of the emotional investments of the participants: 'the
punishment of those responsible' for September 11th should be done in a spirit of 'sad duty', not 'exhilarating retaliation' (2002, 244). Politics does not change, only its symbolic and libidinal inscription. The scathing denouncements Žižek makes of other theorists are therefore much like Mouffe's remarks on Rawls: because of Lacanians' tendency to establish themselves as a sect outside the mainstream, the remarks can involve a radical challenge to established categories, but the political issues at stake are rarely very substantial.

Since, furthermore, the Act or Event cannot establish a better world, the case for performing it becomes extremely weak. The point of the Russian and French revolutions for their participants and advocates was to build a new world which would overcome the exclusions and blockages of older systems. If, however, the new world cannot be better than the old, and if all the problems of the present must either return or be replaced by structurally similar problems, there seems little reason to risk revolution—especially the highly violent and dangerous kind preached by Žižek—rather than to tolerate the status quo. The case for the Act becomes almost religious: it is performed because it has a cleansing, freeing effect on the subject who undergoes it. This hardly seems, however, a solid basis for a political project. The problem is intensified when one takes into account the slippery manoeuvres required in order for the likes of Žižek and Badiou to keep their categories of a true
Act/Event in line with their political preferences (for instance, to keep Lenin in and Hitler out).

(__) Total rejection of capitalism fragments resistance – the alternative never solves

Gibson-Graham, feminist economist, 1996, End of Capitalism

Capitalism has become the intimate enemy. We have uncloaked the ideologically-clothed, obscure monster, but we have installed a naked and visible monster in its place. In return for our labors of creation, the monster has robbed us of all force. We hear – and find it easy to believe – that the left is in disarray. Part of what produces the disarray of the left is the vision of what the left is arrayed against. When capitalism is represented as a unified system coextensive with the nation or even the world, when it is portrayed as crowding out all other economic forms, when it is allowed to define entire societies, it becomes something that can only be defeated and replaced by a mass collective movement (or by a process of systemic dissolution that such a movement might assist). The revolutionary task of replacing capitalism now seems outmoded and unrealistic, yet we do not seem to have an alternative conception of class transformation to take its place. The old political economic “systems” and “structures” that call
One of our goals as Marxists has been to produce a knowledge of capitalism. Yet as “that which is known,” forth a vision of revolution as systemic replacement still seem to be dominant in the Marxist political imagination. The New World Order is often represented as political fragmentation founded upon economic unification. In this vision the economy appears as the last stronghold of unity and singularity in a world of diversity and plurality. But why can’t the economy be fragmented too? If we theorized it as fragmented in the United States, we could being to see a huge state sector (incorporating a variety of forms of appropriation of surplus labor), a very large sector of selfemployed and family-based producers (most noncapitalist), a huge household sector (again, quite various in terms of forms of exploitation, with some households moving towards communal or

If capitalism takes up the available social space, there’s no room for anything else. If capitalism cannot coexist, there’s no possibility of anything else. If capitalism functions as a unity, it cannot be partially or locally replaced. My intent is to help create the discursive conception under which socialist or other noncapitalist construction becomes “realistic” present activity rather than a ludicrous or utopian goal. To achieve this I must smash Capitalism and see it in a thousand pieces. I must make its unity a
collective appropriation and others operating in a traditional mode in which one adult appropriates surplus labor from another). None of these things is easy to see. fantasy, visible as a denial of diversity and change.


RSS- SDI 2008 Cap and Trade Aff

AT: Eco Management K/Capitalism
(__) Evaluation of consequences is the utmost ethical act – their ethic allows infinite violence Williams 2005
(Michael, Professor of International Politics at the University of Wales—Aberystwyth, The Realist Tradition and the Limits of International Relations, p. 174-176)

A commitment to an ethic of consequences reflects a deeper ethic of criticism, of ‘self-clarification’, and thus of reflection upon the
values adopted by an individual or a collectivity. It is part of an attempt to make critical evaluation an intrinsic element of responsibility. Responsibility to this more fundamental ethic gives the ethic of consequences meaning. Consequentialism and responsibility are here drawn into what Schluchter, in terms that will be familiar to anyone conversant with constructivism in International Relations, has called a ‘reflexive principle’. In the wilful Realist vision, scepticism

and consequentialism are linked in an attempt to construct not just a more substantial vision of political responsibility, but also the kinds of actors who might adopt it, and the kinds of social structures that might support it. A consequentialist ethic
is not simply a choice adopted by actors: it is a means of trying to foster particular kinds of self-critical individuals and societies, and in so doing to encourage a means by which one can justify and foster a politics of responsibility. The ethic of responsibility in wilful Realism thus involves a commitment

to both autonomy and limitation, to freedom and restraint, to an acceptance of limits and the criticism of limits.
Responsibility clearly involves prudence and an accounting for current structures and their historical evolution; but it is not limited to this, for it seeks ultimately the creation of responsible subjects within a philosophy of limits. Seen in this light, the Realist commitment to objectivity appears quite differently. Objectivity in terms of consequentialist analysis does not simply take the actor or action as given, it is a political practice — an attempt to foster a responsible self, undertaken by an analyst with a commitment to objectivity which is itself based in a desire to foster a politics of responsibility. Objectivity in the

sense of coming to terms with the ‘reality’ of contextual conditions and likely outcomes of action is not only necessary for success, it is vital for self-reflection, for sustained engagement with the practical and ethical adequacy of one’s views. The blithe, self-serving, and uncritical stances of abstract moralism or rationalist objectivism avoid self-criticism by refusing to engage with the intractability of the world ‘as it is’. Reducing the world to an expression of their theoretical models, political platforms, or ideological programmes, they fail to engage with this reality, and thus avoid the process of selfreflection at the heart of responsibility. By contrast, Realist objectivity takes an engagement with this intractable ‘object’ that is not reducible to
one’s wishes or will as a necessary condition of ethical engagement, self-reflection, and self-creation.7 Objectivity is not a naïve naturalism in the sense of scientific laws or rationalist calculation; it is a necessary engagement with a world that eludes one’s will. A recognition of the limits imposed by

‘reality’ is a condition for a recognition of one’s own limits — that the world is not simply an extension of one’s own will. But it is also a challenge to use that intractability as a source of possibility, as providing a set of openings within which
a suitably chastened and yet paradoxically energised will to action can responsibly be pursued. In the wilful Realist tradition, the essential opacity of both the self and the world are taken as limiting principles. Limits upon understanding provide chastening parameters for claims about the world and actions within

provide challenging and creative openings within which diverse forms of life can be developed: the limited unity of the self and the political order is the precondition for freedom. The ultimate opacity of the world is not to be despaired of: it is a condition of possibility for the wilful, creative construction of selves and social orders which embrace the diverse human potentialities which this lack of essential or intrinsic order makes possible.8 But it is also to be aware of the less salutary
it. But they also possibilities this involves. Indeterminacy is not synonymous with absolute freedom — it is both a condition of, and imperative toward, responsibility.

(__) 1AC acts as an impact turna) Mead evidence says that collapse of the US economy will cause Global nuclear war and extinctiontransitioning away from capitalism is worse than your impacts. b) Withdrawing from capitalism would collapse US’ competitiveness- the impact to this is the Khalilzad evidence. Only in a world of strong US leadership is able to prevent the rise of


RSS- SDI 2008 Cap and Trade Aff

AT: Eco Management K/Capitalism
(__) The Worst abuses of capitalism and the state are self correcting. Karshis 2005 (Sean, “Capitalism and the Self Correcting mechanism,”
As a government infringes on personal rights, namely that to live, and dabbles into commerce in its� inefficient and expensive way, capitalism will be eager to correct it. The economic system can reinstate infringed personal freedoms and direct government in a positive direction,
reducing the costs inherent. There are six ways in which capitalism does this. Competition-To

keep competitive (and raise living standards) a country must increase production. As production is increased profits also increase, increasing the incentive of capitalists to partake in the struggle for increased production. If this cycle stagnates through poor resource expenditure, or bureaucratic red tape, productive jobs are lost to other nations, as foreign capitalists compete for productive labor. The bureaucratic nation will economically decline and its citizens may demand change, or other countries more suited to capitalism will advance and eventually dominate the statist nations.
Devaluation If a government has a record of poor economic policies, or managed it�s business poorly, the capital markets of the world will penalize them by reducing credit availability and devaluing the currency. This is not a conscious decision of one person, but a general capitalist reaction.

Black Market "One tell-tale sign of the excessive regulation of domestic markets is a thriving black economy." Jim Walker, chief Asian economist at Credit Lyonnais, estimates that the "underground economy accounts for 30-50% of GDP in Indonesia, the Philippines and Thailand, and 20-30% in South

As government extends its reach (increasing taxes or watering rights by inflation) people spend more of their time creating their own market, as to avoid the governmentally dominated one. This lowers tax revenue, decreases the abilities of the government, and if persistent, can lead to a serious weakening of the state, and prepare it for a revolution and capitalist correction. Economic Revolution If the nation�s people are not allowed jobs and an increasing standard of living, and other nations are experiencing this, there will be an economic revolution. This begins with a black market and later will spark into a political revolution that
Korea Malaysia and Taiwan". These economies are inundated with red tape. demands changes. If the nations that the civilians compared themselves to are capitalist, these free ideals will be demanded. History may prove me wrong, as we are seeing in a rising (yet not dominant) power of Communists and a disenchantment of capitalism in Russia, but the trend of the last 50 years has been toward economic liberalization and capitalism.
The Media Sinclair Lewis�s book The Jungle is a perfect example of the market recognizing failings in the system (in this case, the government oversight of the neighbor effect of poor meat packing), and the

The modern media networks are derived of capital and run for profit; they are a function of a thriving capitalist economy. The more eyes looking for problems (because problems tend to promote sales for the media) the more problems will be found. Noam Chomsky, a noted linguist and political commentator, believes that the media is a direct reflection of the dominant power
state was painfully informed as millions of Americans learned of it through this novel. structures of a nation. I agree, yet he also maintains that there is news deemed by the economic elites as �not fit-to-print� and insinuates that a sort of conspiracy is at work maintaining this. I disagree. Think of the popular media industry (TV, newspapers, magazines, movies, and literature) as a loud sounding board of a population, so loud in fact that that it has the ability to alter the original sounds of the population, when this happens it is called propaganda; Chomsky would agree. Yet the multitude of media services are scrambling for market share, whatever people will buy, they will sell. If the populations want to hear something they will buy it (or watch it and increase Nealson Ratings), increasing profits for the publisher, which could (assuming enough people also wanted to hear such information) create a new market. This cycle has no room for a cultural editor, who if not directly in pulse with the desires of the population will produce the wrong show, and some other media wit will fill the gap. Only if there were a monopoly over media could this be true. In 1989 twenty-five companies produced nearly 50% of our nations news, this is not a monopolyz , these news servers are not in cahoots, in fact rivalry is fierce. There are people who through the power of the dollar are able to pursue what they want to know far easier than those who do not have the financial means. Bill Gates, Rupert Murdock, or Ted Turner all have extraordinary sway in public opinion, yet among the three of them there is not collusion or a conspiracy to assemble world thought. Each is interested in their own self-interests, namely the pursuit of profits. Each acquires profits by increasing market share of their respective product, if this does not suit the populations, profits are lost to a competitor, and a more suiting idea or news is fashioned for the public.

Governments and other organized bureaucratic institutions have been the developers of humanities worst atrocities. The harm caused by DDT or Long Island pale in comparison to the horror of the Holocaust in Nazi Germany, or the atrocities of the Khmer Rouge in Cambodia. The importance of commerce today diverts the attentions of nations from military aggression toward trade. The productive benefits of capitalism can create a positive avenue for the meddling of governments. Through these means the economic system of capitalism struggles for dominance against the pressures of government. This is a just cause. Capitalists thrive on individual freedom, governmental bureaucrats thrive from gathering as much freedom (through taxes and laws) to keep their department (and their job) growing and safe. Capitalism allocates money cheaply and efficiently, government�s pay more per dollar spent, and tend to allocate it inefficiently. Capitalism increases long run productivity, growth, and standards of living, large governments don�t. Through all of this bickering there are two main points. If the government is acting beyond its purposeful role, capitalism will attempt to gather this control. Second, if government is acting efficiently by allowing capitalism enough room to grow and innovate, the nation and its citizens will prosper and realize increased freedom. In the words of Ayn Rand: "Those that advocate laissez-faire capitalism are the only
Economic Diversion advocates of a man�s rights." (Italics in original)


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