This was a constant tension at the conference. The ideological conservatives at WSJ kept pushing the tax point, as though it were some devastating gotcha. Thing is, everybody who knows a damn thing about policy knows that yeah, it's a tax. We need to raise taxes on energy. That's a key part of the solution. But the t-word has become so demonized, policy analyst after policy analyst is forced to do a song and dance, dodging the point. Our discourse has become so silly.

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After Myron Ebell of CEI asked, for the gazillionth time, about the horrendous costs a cap-and-trade system will impose on the economy, I'd had enough. I raised my hand and mentioned the McKinsey study, which shows that about the first 40 percent of reductions will be cost-negative -- i.e., profitable -- and asked why everyone, including the candidates, seems to willing to accept this tendentious premise. After all, CEI-types have been forecasting economic catastrophe from every regulation passed in the last century, and every time, without fail, they're proven wrong. Why do we keep listening?

Who should rush to my support but Douglas Holtz-Eakin, McCain's representative. He said, my candidate absolutely thinks you're right -- that the American economy has a capacity to innovate that always proves pessimistic economic models wrong.

Later, Sperling echoed the thought. He said Bill Clinton referred to it as a debate between the "lemon-suckers" (i.e., economists) and the techno-optimists (i.e., Al Gore). He said models always show deadweight but can't predict innovation and invention.

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Someone asked about a carbon tax, which economists purportedly prefer to cap-and-trade. Holtz-Eakin challenged the premise vigorously. He said economists "would rather be right than useful." They're always comparing a theoretical carbon tax to real-world cap-and-trade system. In the real world, tax policy is just as subject to complexity and gaming and loopholes as a cap-and-trade system -- it will end up with just as many "warts." This is an excellent and under-appreciated point.

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Grumet said at one point that all three candidates were "directionally correct" on carbon policy. Murray said, maybe you could all three run on the same ticket! Grumet responded wryly, "don't worry, there's room on the cabinet."