Though most people expect the Bush administration to do little to pass climate change legislation during its final year in office, there is still a tremendous amount of work being done in Congress. The Lieberman-Warner bill appears to be most likely to get 60+ support in the Senate this year according to Lieberman himself. But what would be the political impact of such a bill? Does it remove global warming legislation from the federal agenda? Or will it just create a not-as-good substitute for legislation that might pass in 2009 or 2010 with one of the current presidential candidates? If the Lieberman-Warner bill passes in 2008, then does that put more pressure on Republicans in this election cycle or remove political pressure from them? It would likely spur technology development and innovation but by how much?

One of the issues I have heard discussed is that any cap-and-trade or carbon tax system would have to require removal of Corporate Average Fuel Economy (CAFE) standards and other pollution mitigation standards that would end up being a double-tax on carbon. Is this true? Businesses seem to be arguing so - that we need a balanced package for environmental regulation changes. Is the EPA capable of handling changes in Lieberman-Warner or should Congress be thinking about this.

On another note, the Wall Street Journal is today reporting that the EU cap-and-trade system has failed to lower carbon emissions. In fact carbon emissions have risen about 1.1% last year. Is this a policy failure or implementation failure?