Election Day signals the end for cap and trade

Republicans made big gains in Congress in last week's elections, which means it will be tougher for President Barack Obama to keep his campaign promises. In a press conference the day after the election, President Barack Obama himself acknowledged one proposal, in particular, was doomed: cap and trade.

The last time we checked in on cap and trade, its prospects didn't look good. The legislation had passed in the House in 2009, but had not been taken up in the Senate.

What is cap and trade? The idea is that the government sets a limit (the cap) on how much carbon different companies can emit. The government then issues permits to companies -- typically electric utilities and manufacturers --and allows them to buy and sell the permits as needed (the trade). If the policy works as planned, overall emissions decline, companies determine for themselves the best way to lower emissions, and the free market rewards those who lower emissions most effectively.

Republicans, however, attacked the plan as a job-killing energy tax, a description that is not entirely accurate. The plan never made it to a vote in the Senate.

Last week, Republicans increased their presence in the Senate and won the majority in the U.S. House of Representatives. At a press conference the next day, Obama acknowledged a changed political landscape while holding out hope for other issues.

"I think there are a lot of Republicans that ran against the energy bill that passed in the House last year," he said. "And so it's doubtful that you could get the votes to pass that through the House this year or next year or the year after.  But that doesn't mean there isn't agreement that we should have a better energy policy.  And so let's find those areas where we can agree."

"Cap and trade was just one way of skinning the cat; it was not the only way," he said later. "It was a means, not an end.  And I'm going to be looking for other means to address this problem."

Obama may make headway on some of his other promises on energy and the environment, but it's clear he's giving up on this one because it can't make it through Congress. We rate it Promise Broken.